Monday, November 30, 2015

How to Protect Your Budget and Skip the Financial Headaches this Holiday Season

Protect your budget and skip the financial headaches this holiday season


Well, it’s official. The holiday season is once again upon us. Among other things, it’s shopping season, as we prepare to give gifts to our loved ones. As tradition goes, this is supposed to be the most wonderful time of the year. However, according to the evidence on the ground, the vast majority of us find ourselves at the end of the most wonderful time of the year up to our eyeballs in financial regret of one form or another. This is typically the result of spending more money on gifts than we expected.

If you are among the millions of folks who keep exceeding your spending targets, year after year, and are looking for a fix, you might want to consider implementing these two suggestions.

First, understand that a gift is supposed to be a token and not the recipient's literal dollar value.

Obviously, this is something you already know. However, I think we need to remind ourselves of this fundamental truth from time to time, especially during the holiday season. It seems that, as a society, we are gradually moving away from this basic gifting tenet toward a view, however subtle, that the more expensive the gift, the more “acceptable” – and, quite frankly, they better you are, as the giver. That belief couldn’t be further from the truth.

Of course, I’m not implying here to avoid giving gifts you consider to be expensive. If you can afford to pay for them without creating an unnecessary burden on yourself after the fact, go ahead and knock yourself out. But that doesn’t change the fact that giving a gift should not place any unwelcome financial burden on you. Based on my experience in counseling folks over the years, I can tell you that this notion is at the very root of many of the financial nightmares that surround the holiday season.


Second, make a “cash list” instead of an “item list.”

More likely than not, you’re like most folks and have some form of shopping list. But it doesn’t seem to help much, in terms of keeping your overall expenditures within your expectations. You are probably going about it this way: you make a list of those to whom you intend to give gifts. You may or may not already have specific items in mind for certain people on your list. Then, of course, you do your absolute best to shop for the lowest possible prices for those gifts.

That is the wrong approach, because although you may be hoping to spend a certain amount, somehow you’ll end up way beyond that. To guarantee you’ll spend what you intend to spend – avoiding the risk of overspending and all the excess baggage it brings – include a “cash column” on your list, where you specifically indicate how much money you intend to spend on each individual. This way, you will select gifts that meet your cash targets, instead of the other way around, choosing gifts first and trying to juggle your budget to match them.

Happy shopping. And all the best this holiday season!
________________ 
Visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation with a financial professional who has your best interest at heart and who is willing to ask the tough questions to help you make a plan that will get you where you want to go. Youll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If youre ready, were here to help. 

Monday, November 16, 2015

Another Misleading Piece of Financial Advice from Kiplinger's

Another misleading piece of financial advice from Kiplinger's


A little over a week ago, I saw an article titled “6 Ways to Avoid Outliving Your Retirement Nest Egg,” authored by Kiplinger’s Kathy Kristof. This single statement caught my attention – in a rather negative way – because it highlights what I believe is a very serious problem with many in the financial press: making generic statements that do not accurately reflect what’s out there in the real world. This, in turn, leads unsuspecting readers to draw conclusions and make decisions that are equally wrong, with potentially dire financial consequences, to say the least.
 
Under the sub-header “Buy an Annuity,” the author’s concluding paragraph said this, among other things:
“Be aware that generally if you buy an annuity and are run over by a truck a month later, no residual goes to your heirs. …”
Quite frankly, that is simply nowhere near what “generally” happens when folks buy most annuities. Rather, it’s very far from it.

Indeed, there is a specific kind of immediate annuity contract that works that way; it has a life-only payout and no refund option. However, that is only one specific variation in an entire class of immediate annuity contracts. On the other hand, there is also a slew of immediate annuities with life payout AND refund options that pay you for life, in addition to guaranteeing a specific refund payment to your heirs upon your death.

Besides, it is worth noting that there is a whole other class of annuities called deferred annuities, which make up the vast majority of annuities on the market today, in which case – to borrow Ms. Kristof’s analogy – if you were to be run over by a truck a month later, all of your money would be returned to your heirs.

So even if you inserted the word “immediate,” so that the statement read, “Be aware that generally if you buy an [immediate] annuity and are run over by a truck a month later, no residual goes to your heirs,” it will still be inaccurate. 

The only way I can see that statement serving a useful purpose and properly informing Ms. Kristof’s readers to make educated decisions – which I’d like to imagine a publication such as Kiplinger’s to be all about – would be if it said something like this: 
Be aware that generally if you buy an [immediate life-only] annuity [without a refund option] and are run over by a truck a month later, no residual goes to your heirs.
I’d like to state for the record that I’m by no means rooting for or against any particular kind of annuity, or any other product for that matter. Not at all. Here’s what I’ve always rooted for: Putting out the right factual information so that folks can make good decisions. But can you see how easily you can be misinformed by statements like these? So much so that you might take an action that could affect you for an entire lifetime, and even beyond? That’s my whole point!

So, my dear friend, don’t make decisions surrounding your financial future solely based on what you read in the press. Talk with an independent financial advisor with a proven record and a fiduciary obligation to put your best interest ahead of everything else. Then carefully weigh your options so that you can make the best possible choices that specifically work for you.

I wish you the very best.
________________ 
Visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation with a financial professional who has your best interest at heart and who is willing to ask the tough questions to help you make a plan that will get you where you want to go. Youll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If youre ready, were here to help. 

Monday, November 2, 2015

What Will Your Heirs Do With the Inheritance You Leave Them?

What will your heirs do with the inheritance you leave them?


When it comes to the future and money, the story of life generally goes something like this: you work hard, plan ahead, and make sure to save as much money as you possibly can toward your retirement so that you can have a smooth, financially stress-free life down the road.

Sure. That’s definitely part of the process, but in my humble opinion, it’s only half the story. The other equally important – if not more crucial – aspect of the process involves what will happen to the inheritance you will leave behind. I’m literally referring to the money you will leave behind to your beneficiaries.

So here’s the question: When it’s all said and done and you depart this planet, will your hard-earned money be used in a manner that reflects your values and expectations?

If you expect your inheritance to be used in a more tangible way to further the lifestyle of your loved ones, be sure to articulate those expectations over the course of your life. More importantly, take the time to impart your values, ethics, and core beliefs on your loved ones now, while youre still here, instead of just writing their names on the beneficiary forms.

In my practice over the years, I’ve come to notice that the overwhelming majority of folks have very specific desires, expectations, and visions they hope to impact with the inheritances they will leave behind to their heirs. Unfortunately, however, many haven't made those expectations clear to their beneficiaries. They’re just hoping that the inheritances will be put to good use.

As the evidence and my experience show, when folks don't have clear conversations with their heirs about prospective inheritances, those heirs tend to spend their bequests frivolously, so to speak. But then again, that shouldn’t be too surprising, should it? 

On the one hand, you could argue that its a gift, so your beneficiary should use the inheritance as he/she sees fit. Not to mention that you literally won’t be around to see what happens. If that’s your thought, you’d be absolutely correct. The point I’m trying to get across is just to make sure you’re okay with that – or start talking NOW!
________________ 
Visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation with a financial professional who has your best interest at heart and who is willing to ask the tough questions to help you make a plan that will get you where you want to go. Youll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If youre ready, were here to help.