Creating Financial Plans

Plan While You’re Young

Watching financial advisors put their own house in order teaches you about building your own plan. You’re never too young, and here’s why.

My husband Brian and I married two years ago. I went through our finances, combined accounts, changed names, updated beneficiaries and made a list of items to complete: wills, powers of attorney and additional life insurance for me.

Why Poor Planning = Disaster

Too many people think retirement planning is simple. Then years later, they find they don’t have enough money to retire on. How did that happen?

They think you just throw some money into a savings account, with little regard for the account’s tax status, and put little thought into the investments. After all, the market always goes up, right? They assume if they save X amount of dollars today, then they should be fine 10 or 30 years down the road.

Fear: Biggest Threat to a Plan

The only thing your goals, life and financial plan have to fear is fear itself. Here’s how to keep your perspective.

Steve Jobs, founder and brains behind Apple (AAPL) endured a long battle with pancreatic cancer. The following is a Steve Jobs quote toward the end:

Keep in Touch With Advisors

You’ve met your financial planner to discuss your goals, written up your financial plan and signed on all the dotted lines to transfer your accounts. Congratulations, you have a financial planner. From new babies to a new inheritance, you now have many reasons to contact that professional. Here’s how to stay in contact.

(This is the last of four articles on what you can expect in the process of financial planning.)

Agility in Your Investing

Often people see their financial plans as fixed in stone. You don’t want to wander too far off your financial goals, yet goals change. Your plan must evolve with your financial objectives.

If you talk to a financial planner, the process usually goes like this:

Step 1. Determine your goals.

Step 2. Determine your risk tolerance, or comfort with potential losses in the market.

Step 3. Design a portfolio, within your risk tolerance, to achieve your goals.

How to Sign Up an Advisor

You’ve met your financial planner, talked over your future and spelled out your goals and money objectives both verbally and in writing. Now comes the paperwork to formally set up your plan and your relationship with the advisor.

(This is the third of four articles about what you can expect from the process of financial planning.)

Flexibility in a World of Change

As summer comes to an end, it pays to take a good look at how flexible you are. When you plan for the future, you need to be adaptable. No one knows what tomorrow holds.

This is certainly true in the world of work. Earlier this month, we celebrated Labor Day. President Grover Cleveland signed it into law as a federal holiday in 1894 to placate unions, following a bloody and tumultuous strike at the Pullman Co., which made railcars. Today, the break on the first Monday of September is less about labor and more about recreation, cookouts and the mental end of summer.

Advice Made to Order

Professional financial advice targeted toward you, your life and your goals works much better than generalized, scattershot investing tips.

What a Financial Plan Covers

You conquered fears of laying details of your life on a financial planner’s table. You sat down with the planner for the discovery meeting to reveal your finances and your future and what you want out of both. Now comes the financial plan.

(This is the second of four articles about what you can expect from the process of financial planning.)

Millennials & Financial Plans

The millennial generation, now entering adulthood, needs to start investing and insuring itself, to prepare for the future. But that is a difficult concept for young people to get their minds around.

In my twenties, before marriage and children, “the future” was the next weekend. Horizons change as life progresses. Generation Y, also known as the millennials, were born between 1980 and 2000. The leading edge of the 77 million-strong Gen Y cohort turns age 33 in 2013. In 10 short years, they will be 43 and 10 years beyond that, 53.


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