Planning Your Long-Term Financial Needs
According to results of a Charles Schwab survey, released June 4, 2009, nearly 40% of Americans are not saving for retirement and over 60% have not adjusted their retirement needs or investment strategy in the current downturn.
Rather than simply accept the thought that you’ll just have to work past the typical retirement age, please consider the following suggestions:
- Start NOW! If you have not started to put money away for retirement, do something today. Even if it’s $5 a month into a standard savings account, set up an automated transfer. Later, increase the monthly contributions.
- Pay Yourself! As you pay off any debts you currently owe, take those same monthly payments and pay yourself. For example, once you pay off a credit card debt that is currently requiring a $250 monthly payment, begin putting that $250 each month into your savings plan.
- Remember Inflation and Taxes! Annual inflation averages a little over 3%, and most all of us have to pay some sort of income or investment tax. Combined, they can easily average about 4.5% annually. That means that just to break even, our investments need to return at least 4.5%. Putting your money into Certificates of Deposits or savings accounts only may be a “safe” investing strategy, but you’re also all but guaranteed to lose value in your investments EVERY year.
- Find a trusted advisor. Financial planners are not just for “the rich.” Ask around for referrals. Ask someone you admire if they have a planner they respect. Find someone with experience, a track record of success, and someone who wants to build a long-term relationship of regular financial counseling, not just someone trying to sell an insurance policy
Trusting that your financial future will take care of itself is not a financial plan. Take time, ask around, and do some research. You’ll find that investing in yourself will pay undreamed of dividends for years to come.
If you have any questions, would like to discuss your financial challenges, or are just looking for advice, please call us at your convenience. As always, we are here to help and look forward to hearing from you.