Creating Financial Plans

$ To-Do List for Rest of 2014

With most of this year suddenly behind us, plenty of financial chores remain for you in 2014. Here are eight to-do items for your list.

1. Review your 401(k). With the Standard & Poor’s 500 and other market indexes at or near all-time highs, revisit your 401(k) asset allocation and, if needed, rebalance. Why not take this chance to activate the auto-rebalance feature if your plan offers one?

The Rich and Their Advisors

Rich people have different problems. For the more affluent, the financial planning process is more complicated. That’s why this clientele often turns to a team of professionals.

But there typically is one central advisors to play quarterback, coordinating the efforts of such experts as accountants, real estate attorneys, estate planning attorneys, said Stephen Stabile, senior vice president and wealth management advisor at Merrill Lynch, in an advisor panel.

Planning Beyond Investing

Financial advisors can reach far beyond a portfolio and investments. Most people have no idea that advisors can assist with matters as diverse as estate plans and insurance, to ensuring you invest with your head and not always your heart.

“Emotions will overcome economic considerations every time,” said Tim Maurer, wealth advisor with Buckingham Asset Management and director of personal finance for the BAM ALLIANCE, speaking on a recent advisory panel.

Bad Decisions in Old Age

What if you lose your mental capacity in later years and make irrational financial choices? How can you safeguard your assets from that threat?

After three decades as a financial planner, I see more and more clients reach, not just retirement, but their final years. An issue that becomes especially important at this stage of life is how to protect your financial resources from an unexpected threat – yourself.

$ Decisions: Small Is Better

I spend a lot of time helping people make financial choices, sometimes about business and sometimes about personal life. In both cases and in many more, breaking huge issues and questions into smaller choices makes problems much easier to manage.

Don’t Understand an Advisor?

What if you don’t understand what your financial advisor tells you? When the advisor uses abstruse (to you) financial or legal terms, you’re left in the dark. That is obviously not good for you in planning your finances. Here’s how to get clarity on the advice you hear, and pay for.

One of my staff members several years ago drove the communications problem home to me with this useful bit of advice: “Rick, your clients don’t understand half as much about investing as you think they do.”

How to Be Independent

The major objective in comprehensive wealth planning is financial independence. But true independence in life means not only good finances, but health and relationships.

Advisors: Plans, Not Fads

Will you ever stop underperforming your own investments? The rollercoaster market naturally spurs you to chase trends and lose sight of what you really ought to do: Stick to a well-advised plan of long-term payoffs and goals.

Winning by Losing Less

To reach your financial goals, you don’t have to outperform every benchmark every year. For long-term investors, avoiding and mitigating losses is a key factor in achieving ultimate success in your portfolio.

Setting the Right Goals

The first step of successful investing is setting goals. Right goals. Having a long-term stable income for retirement is a right goal. Accumulating $1 million is not.

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