Retirement Guys: What would Dad do?Written by Nolan Baker Mark Clair | | email@example.com
Time continues to fly by and here we are again with another Father’s Day upon us. This is a time to honor our fathers, and reflect on how they have molded and shaped our lives. Many of us have had the benefit of our fathers being a positive influence on us.
Here at The Retirement Guys, it is part of our philosophy to not forget lessons learned from the past — things we have learned from our parents, grandparents and others who have had a positive effect on us. We take these lessons in hard work, perseverance, sacrifice, tenacity and character and add them to the many things we now have at our disposal that we did not in years past. This includes things like new technology, ideas and strategies that help us do things better than we ever have before. If you think about it, though, it is important to have a foundation in good character. It is important to make good decisions and to do the right thing. Although it is ultimately up to us what kind of people we choose to be, our parents (especially our fathers) and grandparents probably had something to do with how we turned out.
We asked members of The Retirement Guys team what they remembered about things their fathers said or did that have stuck with them. Here are a few examples: “Hard work beats talent,” and “Do it right or do it again.” It occurred to us that there was a resounding theme in those “words of advice” from the dear old dads. In honor of Father’s Day, we’d like to recommend following the below father-like recommendations to help guide you to the best financial plan possible:
1. Identify an emergency or rainy day account
Make sure there is enough money in this account to last you in an emergency for up to six months. Gaining financial independence starts with building up a liquid account, such as a savings or money market account, to cover short-term emergencies that will come up. An emergency could be a new furnace, a major car repair or unexpected health care bills.
2. Move money from the left pocket to the right
This means pay yourself first. Complete a budget to find out where money is going on a monthly basis and then identify ways to change spending habits. It could be eliminating two nights dining out and instead opting for a movie night or playing cards with a spouse or friends at home. Instead of signing up for the gym membership, try free alternatives such as group runs or biking in our local metro parks. A few simple and easy changes could save several hundreds of dollars a month that can be put into building the emergency account up.
3. Eliminate all outstanding debts
When someone has debt he or she is a slave to the lender, subject to rules and changes with limited or no control. Principles of saving can become a habit and since it can take a few months to build up an emergency account, those habits can become a regular way of life. Once the emergency account is built up, redirect those savings dollars toward debt elimination.
4. Increase the amount of money being saved for retirement
Time flies and what seems like a long way off will be here before you know it. Remember that financial independence means freedom from control or influence of another or others. At any point, the company retirement plan could change, be it the pension, health expenses, etc. The same should be expected with government benefits such as Social Security for yourself or a survivor along with all government benefits. The single best way to address this is to save and invest on your own. Put away 20 percent of earnings in a retirement savings account. Save as much as possible once debts are eliminated and increase savings every time there is a pay raise.
It is amazing to me how much a father’s love and approval means to all of us. We recommend that you stop letting circumstances and others control your financial future and do some of the things Dad would do. As true to life, don’t rely and expect others to take care of you in the future; take personal financial responsibility. It will take some time; it will take some effort, but won’t being able to reach your Freedom Day be worth it? Your dad would be so proud of you knowing that you are in control of a solid financial retirement plan. In the meantime, The Retirement Guys wish you all a very Happy Father’s Day.
For more information about The Retirement Guys, tune in every Saturday at 1 p.m. on 1370 WSPD or visit www.retirementguysradio.com. Securities and Investment Advisory Services are offered through NEXT Financial Group Inc., Member FINRA / SIPC. NEXT Financial Group, Inc. does not provide tax or legal advice. The Retirement Guys are not an affiliate of NEXT Financial Group. The office is at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537. (419) 842-0550.
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