Printer FriendlyIn 2008, Simplify Your Financial Planning
Two of the top New Year’s resolutions are to get “physically fit” and to get “financially fit.” To take care of #1, folks hit the gyms by the millions in the new year, but for #2, many don’t exactly know how to get started.
Live Your Legacy
The term “Financial Planning” often seems too complex to many people and they just don’t know where to start. I’m writing this to remind you that your financial planning can be made simple.
Of course, one doesn’t need to be a genius to know that you’ll be fine and survive throughout life if you “make more money than you spend.” I can hear many of you now saying, “Jon, that’s nice and almost humorous, but certainly financial planning in the ‘real-world’ must be complicated. Why are the investment, insurance, and real estate industries so large with so much confusing advertising everywhere?
Well, to agree with you a little bit, the “complicated” issue is that you and I don’t want to just financially survive, we want to THRIVE! (With peace-of-mind too!) And once we have maximized our family happiness, we never want to go backwards (we want to protect it and grow it)!
I fully agree with you that achieving dreams and goals can be complicated, but it still doesn’t mean that financial planning can’t be a simple subject.
The following is how “real-world” financial planning can be simplified. After reading this, if you still have questions or want this explained in detail or customized to your personal situation, please don’t hesitate to contact me or one of my team of financial planning specialists (who have helped thousands nationwide) by e-mailing me at jon@legacylifegroup.com.
How is financial planning made simple? Just as being “physically” fit only requires simple questions to be answered such as, “How do I exercise enough and not eat too much?”, financial planning has simple questions too. Six questions have to be answered for you to be “financially” fit:
6 Simple Financial Planning Questions:
- How do I best manage emergencies (the cash and debt management question)?
- How do I protect what I have (the insurance question)?
- What do I do about my largest single asset (the real estate question)?
- How do I make the most of the assets I accumulate throughout life (the Uncle Sam tax question)?
- How do I best grow my assets (the investing and risk-tolerance question)?
- How do I leave the most positive legacy possible (the estate planning question)?
For most people there are 6 Simple Financial Planning Answers to the 6 questions:
- Keep enough cash for emergencies and stay out of debt (unless the debt is comfortable and on an appreciating asset like a house, business or an education).
- Obtain or find better value and quality health insurance, income insurance (disability or business), life insurance, long-term care insurance, and asset insurance (for your money, house, cars, etc.). I’ve listed each type of insurance in priority order and contact me if you want help maximizing yours.
- Own your own home and, as you come across it, buy as much undervalued real estate as you comfortably can (since they aren’t making any more of it, and you’ll be helping out those desperate real estate sellers who haven’t done proper financial planning). If you want professional help in buying, managing, or financing your real estate we can refer a few people to you.
- Do every tax-smart thing in the book that can save you money over the years. Top examples include using a quality CPA, owning a home with a comfortable level of debt, maxing-out your 401k, maxing-out your Roth or Traditional IRA if you qualify, having a side business where you can write off reasonable expenses, using annuities and other retirement vehicles in and out of the company for which you work, organizing financial documents, knowing the IRS rules, using 529 plans, planning your tax year strategy early, doing your estate planning with a lawyer and a financial planner (see #6 below).
- Develop an investment strategy within your risk-tolerance and then use world-class investment managers to implement it. Even if financial planning is your #1 hobby or vocation, you are using an investment team as you invest your funds so pick a team with a great risk-adjusted track record. Of course you care about service, but care most about the bottom-line results. Another way of saying this is to care about the amount of money you have WHEN you need it, after ALL taxes, fees, and expenses have been paid. You also have to be able to sleep at night, so I’ll re-emphasize: pick your risk tolerance first, then your investment strategy, and then maximize what you are doing within that risk-tolerance and strategy.
- Achieve peace-of-mind now by having your financial affairs in order by finishing your will, trust, powers of attorney, and living will. You’ll also do the rest of the world a favor if you make sure your heirs know where to find the documents.
Warning 1!
I’ve attempted here to make the financial planning subject as simple as possible based on my many years of experience helping folks, but as you can see in the disclosures here an in every prospectus you read, IMPLEMENTING your financial planning well and MAXIMIZING your financial planning involves risks that you need to understand.
Knowing what to do in financial planning (as I’ve covered in this article) can be made simple, but implementing the financial plan does take a team of licensed specialists in all of the areas. Unless you are burying money in the back yard and your “team” is just you and your shovel, pick a team that knows your personal goals and concerns and gives you independent, unbiased advice.
Warning 2!
Everything you’ve read here doesn’t matter if you don’t GET STARTED implementing or improving your financial planning, so take action now or put it on your calendar to do so. An easy way to get started is to call right now (888-854-7526) to receive some free financial strategies for your situation in 2008 from my team of specialists. Get to know us and our abilities at LiveYourLegacy.com or LegacyLifeGroup.com.
Good luck with your New Year’s resolutions and have a fantastic 2008!
This article is not intended to provide specific investment or tax advice for any individual. Consult me, your financial advisor, or your tax advisor if you have any questions.
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