Category : savings

Hamburger Helper Really Helped Me

For the past 30 years – pretty much all of my adult life – I have been a planner and a worrier.  I am the type of person that starts packing two weeks before a big vacation.  I am the type of person that starts putting a Thanksgiving grocery list together in OCTOBER.  It isn’t that I plan to worry, I just worry if I don’t plan.  These traits are deeply embedded in the genetic code of my family going back multiple generations.  At times it can be a good thing to keep me on track, but often it can be overwhelming and take up too much of my day.  If I get this worked up prior to a beach vacation or family holiday, you can only imagine how I feel when it comes to retirement planning.

One of my biggest fears in life is running out of money in retirement.  The idea of working in my 70s and becoming a burden on my kids has caused me to lie awake at 3AM more than a few times.  I know how hard retirement planning is going to be for today’s youth so I do not want to add taking care of mom and dad to their plate.  Now I am not just worrying about my own retirement, but the retirement of my children 50+ years away.

How have I learned to deal with this and prevent what is left of my hair from falling out?  By identifying which factors I have control over versus the factors I do not.  I have no control what the market is doing, at what age I die (outside of eating less Kansas City BBQ…not happening), or what the federal tax code is going to look like in 20 years.  What I can control is my savings rate, which funds to invest in, and doing my best to eliminate debt.

I was lucky growing up that my dad was also a planner/worrier, and he taught me at a young age to save and then save some more.  He worked for the same large company for 33 years, working long hours, often travelling more than he was home, and missing valuable family time for the good of the company.  At the age of 53 the company decided he was too old and “retired” him.  It was a scary time and had he not saved for a rainy day, our family would have been in the middle of a monsoon.  Thankfully he was a third generation planner and was prepared by saving, living below his means, and reducing debt.  I’ve always admired him for taking control of his financial situation and not leaving his later years to chance.  He has been retired now for 23 years and is still going strong.

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Fitness & Finances: When Help Helps the Most

Now that we’re a month into 2017, how’s that New Year’s Resolution going for you? If you’re like 80% of the population, my guess is you’ve already called it quits or will by Valentine’s Day. Let’s face it, life gets in the way. It’s not easy.

By far the most common resolutions we all hear about or set for ourselves will involve getting in shape, eating better or losing weight. All those things sound great, but take a lot of time, energy, and dedication to accomplish. And this is especially true if you’re planning to go it alone.

As someone who’s had some success prioritizing my own health and fitness into a daily routine, I see it all-too-often at my gym, especially early in the year. There’s generally two kinds of what I call the “New Year Newbies”, the tortoise or the hare. The hares start out of the gate pushing themselves way too hard. They generally end up hurting themselves or making themselves feel like such a pile of you-know-what afterward that they never want to come back. And then there are the tortoises. They got themselves to the gym but they think that’s all it takes.  Tortoises typically spend their time reading through three gossip magazines while throwing their legs in slow circles on a bike for an hour (without ever breaking a sweat). But hey, can you believe Tarek & Christina (HGTV) are getting a divorce?!…

In this story of the tortoise and the hare, neither win. Because while those people may have taken the right first step by getting themselves to the gym, they probably aren’t going to make much progress. They’ll end up like nearly everyone else when it comes to their resolutions – just another statistic. Let’s face it, this stuff takes time, patience, and a ton of mental strength. And it’s often a process that can feel like lots of small baby steps forward, followed by falling flat on your face repeatedly.

Having someone by your side (that knows what they’re doing) is the key to training.  Specifically, those that seek help from a trusted source, like a personal trainer, tend to achieve far better results than those going it alone. There are several reasons to hire a personal trainer, and it’s not just the motivation that they will charge you if you don’t show up to your work out.  Personal trainers give you individualized workouts that are more likely to provide tangible results. Personal trainers are there to supervise you, tell you when you are using the correct form so you don’t injure yourself. They also provide consistency and a sounding board when you’re not sure your training is going in the right direction (or even progressing like you want).  Trainers are trusted partners who want to see you reach your long-term physical goals.

Now, as you’d expect, herein lies our investing analogy…

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Something about Mary…

When the 60-something woman walked into the office I could see her fighting back the tears.

From time to time this happened to me as a financial advisor. After all, once you’ve counseled 500+ families about retirement, you’re bound to see some tough situations.

But on that day in April of 2009, it turned into a situation I’d never forget. The kind of situation that would make me sick to my stomach.

As I came out to introduce myself to her (let’s call her Mary), she thanked me for my time. I’d never met Mary before. She’d been referred to us by her husband’s co-worker.

We made our way to the conference room and as I always started off meetings, I asked her, “What can we do to help you today?”

Mary replied, “I’m in trouble. And I don’t know what to do.”

“Okay, what’s the situation?”

“Up until last Friday, I worked at a small regional bank for 32 years. On Friday, the Federal Government came in and seized the bank. They locked the doors. We are officially out of business. Which means I lost my job.”

“I’m really sorry to hear about that. That’s definitely not an easy thing to digest…”

“Yeah, well my job is my last concern. The problem is that I had my entire retirement account invested in the private stock of the bank. The valuation last year said it was worth $750,000. Is there anything I can do?”

I already knew the answer and I suppose deep down she did too…the simple answer was there’s nothing she could do. And the stock was virtually worthless. 

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Dear People Who Want to Retire

I’m 34-years old and barely a millennial. I’ve worked in finance for 10 years, which relatively speaking, is not a long time, but enough to look back with insight and a vested eye on the future. I grew up in Kansas and double majored in History & Sociology at the University of Kansas so I don’t even have a business or finance degree to impress you with. In college, my interests aligned more with understanding socioeconomic status and how groups of people are treated, rather than supply chain management, retirement savings and investment banking. And if I were going to be really honest with you, my biggest concern during my formative college years was making sure there were enough handbills around the KU campus to promote my rock band’s next show at the Granada Theater.

This all changed after my parents’ divorce. Their divorce immediately threw me into the realm of understanding discount points on mortgages, cost basis calculations on taxable investments, and estate and insurance planning in an effort to help my mother. During the marriage, she never earned much and always relied on my father to handle the finances. After the divorce, she had to rely and trust in others. This included an investment professional who, despite my mother being fresh off a divorce, low income, and insufficient savings, put her in a variable annuity. More on that in a minute.

And then there is my wife who, in her late 20’s, also sought guidance in an advisor. At that time, she was single, no kids, had heaps of school loans, zero IRA’s and insufficient emergency savings. Yet, she left a meeting with a trusted advisor with a term AND a whole life insurance policy. What she failed to leave with was a strategy on how to pay off her student loans or a plan for retirement savings.

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Don’t Call Me Lazy

I am always intrigued by the comments we get on blooom’s Facebook page. Some are wonderful and uplifting, some are hilarious, and others. . . well let’s just call them “interesting.” But the ones that really catch my attention are those that are critical. And it’s why they are critical that concerns me. These comments criticize our clients for using blooom’s service. They are critical because these people believe that personal finance should remain personal—handled solely by that individual.

More specifically, the comments call out the blooom clients for being lazy or dumb. I came across one this past week and for some reason the following comment hit me hard and prompted me to write this blog:

Why pay someone to look over your money when you should be the one doing it[?] And you wonder why so many Americans are in debt, cause they are lazy with their finances. Sorry not paying someone to make money off of me cause I’m [too] lazy to watch over my own 401k.

When I read this, I didn’t get upset because I am an employee of blooom. I got upset because I am a client of blooom. According to this person, that makes me lazy and to some others who have commented, it also makes me dumb. So not on behalf of blooom, but rather on behalf of blooom clients, I feel compelled to provide a more expansive response to these types of Facebook comments.

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