Using Your 401(k) in Retirement

February 09, 2012

We recently received this  question on the Ask a Question to a Financial Planner section of our blog:

“I have $35k in bank card debt+$30k in retail credit debt. Bank interest range 13/23%, retail 18/29%. I’m 63, and have $40k in a 401acct where I work. I want to retire this year with two company pensions ($1750/month) and early SS($2400/month, both wife and me). I need to get rid of some monthly payments of debt, where should I use my 401 money toward this goal. All my debt is unsecured, my home is paid off, health is good. I’m ready to go fishing.” Continue reading “Using Your 401(k) in Retirement”

One of the Biggest Challenges Facing Financial Planners

February 01, 2012

One of the biggest challenges I face in my line of work is deciding when to explain things in more detailed technical terms and when to explain them in more understandable  “practical” terms.  For example, when discussing the income limits for traditional and Roth IRA contributions, most financial professionals will tell you the limits are based on your adjusted gross income (AGI) when technically they are based on your modified adjusted gross income (MAGI).  In many cases, such as this one, the difference between the practical and the technical may be so small that it’s just easier to speak in practical terms. The problem is that if you don’t know the technical stuff, it’s easy to make a financial mistake. Continue reading “One of the Biggest Challenges Facing Financial Planners”

12 Important Financial Steps to Take in 2012

January 30, 2012

By now, everyone has broken their New Year’s resolutions.  Never fear, taking one financial action step each month is easy and you still have time to finish January’s step.  Taken together these steps can have a tremendous impact on your finances in 2012. Continue reading “12 Important Financial Steps to Take in 2012”

What I Learned Watching the NFL Playoffs

January 27, 2012

Last weekend, the final 4 teams left in the NFL playoffs squared off to see who would make it to the Super Bowl.  This year, it’s the New England Patriots vs. New York Giants playing in the season’s final game.  2 teams, 1 trophy……….I can’t wait.  I’m almost as excited about the commercials as I am the game.  My favorite team was eliminated, so there won’t be a championship parade for me to attend this year.  That made me think.  The NFL has 32 teams.  Only 1 wins the Super Bowl.  Only 1 is considered “successful”.  The other 31???  They all failed to meet their goals and have to wait another year to try to reach them. Continue reading “What I Learned Watching the NFL Playoffs”

When it Comes to Financial Advice, Follow the Money

January 19, 2012

As the election year begins, there’s a lot of concern about money in politics and how it can be used to corrupt politicians and buy votes. But politics isn’t the only profession in which money can be a problem. The same can be said for financial planning too. Continue reading “When it Comes to Financial Advice, Follow the Money”

Is Love Draining Your Money?

January 16, 2012

This is an extreme example. I’ll say that right up front but there are lessons here we can all take away.  Yesterday, I took a call to our financial helpline from a caller who was having trouble making ends meet.  She said that she made good money but was always scrambling at the end of the month to get her bills paid.  As I always do, I started asking her questions not only to get to the root of the problem but to tap into her strengths.  Building on people’s strengths is a much better way to achieve real behavior change than to focus on only the problem and the obstacles.  Anyway, long story short, the root of the problem soon emerged. Continue reading “Is Love Draining Your Money?”

When Should I Consider Having a Trust?

January 11, 2012

At Financial Finesse, we are often asked this very basic question.  It seems simple enough.  A trust, by its purest definition, is a form of ownership.  You can own assets in your name alone, you can own assets with someone else (e.g. jointly), you can own assets by contract (e.g. a life insurance policy), or you can own assets in a trust.  There are several benefits to having assets held in trust.  For example, when you have a trust, you can control who receives trust assets, when they receive these assets, and what these assets may be used for.  Consider the following example:

When I was a child, my father was killed in a car accident.  Prior to his death, he provided instructions in his will that basically said if anything ever happened to him, money should be set aside in a trust until each of my two brothers and I turned 18, after which the money would be used to pay for college. Continue reading “When Should I Consider Having a Trust?”

Helping Employees Cope with Medical Bills

January 10, 2012

Flying home last week from the wintry northwest, I heard lots of sneezing and sniffles from my fellow travelers.  Although we’ve been lucky to have such a mild winter so far, cold January weather usually brings with it the onslaught of cold and flu season.  In a typical year, 5 to 20% of the population in the U.S. will get the flu, according to www.flufacts.com , and some of your employees may end up with flu complications that may require a trip to the doctor or even hospitalization. Continue reading “Helping Employees Cope with Medical Bills”

The Most Important Lessons in Life are the Unspoken Ones

November 14, 2011

My mother-in-law, Stella Anderson, passed away in her sleep last month with her family at her side at the age of 97.  She was dearly loved and will surely be missed.  At her memorial service, her granddaughter (my niece) Britt Anderson spoke lovingly about lessons she learned from her grandmother which made me reflect on some of my own – financial lessons I picked up from her over the years.  Some of the lessons Stella taught her grandchildren were intentional, of course, but other lessons were learned from observing how Stella lived her life.  Britt shared the “intentional” ones first: Continue reading “The Most Important Lessons in Life are the Unspoken Ones”

Nine Key Financial Steps That Procrastinators Miss

October 17, 2011

Yesterday I went to get a mammogram; the annual “boob smashing” is what I call it.  The process isn’t fun so for any of you who haven’t had one, a mammogram basically consists of smashing your breast between two plates painfully stretching your skin along the way, then you are left standing there while the technician walks away.  She ducks behind a machine that reminds me of the wizard of oz behind the curtain.  She then tells you not to breathe (oh sure, relax!!) and hold perfectly still, all the while you are held captive in a strange kind of vice.  If that isn’t enough, they do it again from a different angle and on the other side.  Continue reading “Nine Key Financial Steps That Procrastinators Miss”

Financial Planning: I’m a Geek and I can Prove it

October 07, 2011

It was pointed out to me recently that I can be quite a geek (fortunately, my girlfriend likes geeks).  It was also pointed out that when I was a kid I had to feed my pet dinosaur before I walked 10 miles, uphill, in both directions, to school in the morning.  (I love my kids!  Anyone want them?)  I guess a little back-story might help.  In an interesting twist (at least to us) of timing, my girlfriend and I share a birthday for a brief moment.  Her birthday is on the 20th, mine is the 21st, and we like to spend our birthdays together doing fun stuff.  Or, at least mostly fun stuff. Continue reading “Financial Planning: I’m a Geek and I can Prove it”

Financial Lessons from a 23 Year Old

August 22, 2011

I just got off a call to our financial helpline with an amazing young woman.  It is funny how sometimes you get a caller who should be teaching financial planning instead of calling the helpline; this was one of those calls.  I was struck by her insight and maturity for such a young woman.  She had a good idea of what she needed to do but was trying to do everything at once.  I helped her take a step back and look at things a bit differently.  She had all the right pieces but wasn’t sure how to put them together.  The pieces themselves aren’t the important part of this story, but the wisdom behind how she was making her decisions. Continue reading “Financial Lessons from a 23 Year Old”

Why Didn’t I Sell?

August 08, 2011

“Why didn’t I sell before the market dropped?”  is a question I got from a caller to our helpline last week.  This is a common question, as you can imagine, after a big drop in the market or during an extended bear market.  This caller was extremely frustrated because he was stuck between a rock and a hard place.  He had already turned in his paperwork to retire within the month (too late to cancel) and was making a transfer from his 401(k) to a pension purchase to provide additional fixed income – essentially changing the goal of this money from long term growth to income.  The market drop would lower his monthly income for the rest of his life because his lump sum was being used to calculate his monthly income payment.  He was distraught. Continue reading “Why Didn’t I Sell?”

Financial Planning: Automation…a Friend with Boundaries

August 05, 2011

I have a grocery store that I love.  It costs a little more, but the service is excellent.  One of the things I really like about this store is that when the weather is bad, and you’re dreading the hike to the car with open bags of groceries, there are staff who will come up to you at checkout and say, “Let me take care of that for you.”  They will take it upon themselves to make life a little easier for you.  This is a great idea and, for me sometimes, it is worth the small price differences in food.  It also works because even though I have the option of using the service, I am not obligated to do so.  And, if I want to use coupons to offset the higher prices, I can do that, too.  In other words, I am not locked in. Continue reading “Financial Planning: Automation…a Friend with Boundaries”

How to Be Financially Independent in 5 Years (No Matter What Age You Are)

August 04, 2011
Updated June 14, 2017

One of the things that makes the lives of financial planners so difficult is that we usually have to get people to do what they don’t want to do, so that they can get what they want. In other businesses and professions, you’re generally either providing a good or service that will provide some immediate pleasure or alleviate some immediate pain.

Financial planning is more like dieting and exercise. Almost all the pain (saving money, taking a little more investment risk, diversifying out of your favorite stock, or taking the time to draft boring estate planning documents) is upfront for a gain (being debt free, having enough money to retire, or making sure your family is taken care of in case something happens to you) that often seems distant and far away. Continue reading “How to Be Financially Independent in 5 Years (No Matter What Age You Are)”

So You’re Having a Baby? Six Ideas to Get Ready Financially

August 01, 2011

I just heard the news that my niece is pregnant with a little girl!  I am doubly excited for her since as a mother of three boys (and one girl), I am still “underweighted” in girls.  Bring on the pink.  What I’m about to say may come as a shock to you, and I feel I have license to say it because of personal experience with pregnancy (even though it has been over twenty years): When women are pregnant, they tend to act differently (read c-r-a-z-y).  (Any husbands want to second that?)  I can promise you that at some point in your life, you will have a pregnant woman say, or do something, that will leave you scratching your head.  Whether it’s eating pickles and peanut butter together (yuck!), eating entire boxes of frozen spinach (guilty), crying uncontrollably for seemingly no reason, having an uncanny sense of smell and being able to tell what people had for lunch or forgetting how to do things they’ve done a thousand times before, it will happen. Continue reading “So You’re Having a Baby? Six Ideas to Get Ready Financially”

What $40 and a Basket of Dirty Laundry Taught Me

June 03, 2011

A while back I had the opportunity to do what most college kids and moms with extra-large comforters find themselves doing. I was a frequent-flyer member of my local laundromat.

I was in the process of having a laundry room put in at my house. Great news, except that instead of having the convenience of working from my desk while my laundry churned away, I was going to have to haul my laundry elsewhere. No problem, I thought. I will tough it out. The project was set to be completed in 2-3 months’ time. Continue reading “What $40 and a Basket of Dirty Laundry Taught Me”

GUEST BLOG POST: To the Class of 2011: Financial First Things

June 02, 2011

I’m waiting, but the invitation to give a college graduation speech hasn’t arrived yet.  It’s really too bad, since I would be a great candidate.  I’m acceptably old, just of an age to be respected by the 20-something set, but not so old as to be irrelevant or needing assistance to the podium.  The fact that I’m a woman should appeal to the majority of college graduates.  Giving sage advice is what I do all the time as a financial advisor.  Plus my speech is already written. Continue reading “GUEST BLOG POST: To the Class of 2011: Financial First Things”

Budgeting: You May not Think You Like it, but Give it a Try

May 27, 2011

So, this just might be the most embarrassing thing I have ever written. This is one blog I hope that NONE of my friends read, because this is just far too much information for them to have at their disposal. Here it is, my confession, I really like the show “Glee.” I can’t believe I’m admitting that. I watched one episode to see if it was acceptable for my kids to watch, and I won’t share my opinions about that part, but my daughter and all of her friends are huge Gleeks (fans of Glee), and now…so am I. Why do I tell you this most embarrassing of admissions? Continue reading “Budgeting: You May not Think You Like it, but Give it a Try”

Reduce Financial Stress with Clarity and Direction

May 02, 2011

Overwhelming stress takes its toll.  Research shows that stress is the leading cause of disease and financial stress is the most common stressor.  Imagine the feeling of not making ends meet and not having a safety net – no emergency fund and high debt so you feel like you may never get out of it.  In our latest research, we studied stressed out employees who used our financial wellness assessment and found there were two things they all had in common — no emergency fund and high debt.  Maybe it was the combination of the two that put them over the edge of “high stress” to “overwhelming stress.” Continue reading “Reduce Financial Stress with Clarity and Direction”