Keep on Track with Monthly Family Finance Meetings

Are you and your spouse on the same page about money? Do you talk regularly about your finances? If not, a monthly family finance meeting might help. I know, talking about money and budgets every month doesn’t sound like a lot of fun, but it can be an easy and relaxed way to keep tabs on where the money’s going and communicate clearly about financial priorities.

What should you cover at a family finance meeting?

  • Go over bills and credit card statements together. Discussing the previous month’s expenses are a good way to make sure you’re not straying beyond your means. Checking statements carefully can also help you catch fraudulent transactions and billing errors.
  • Discuss any financial, insurance or investment decisions you need to make. Your meeting is a good time to get both of you up to speed on any insurance changes, portfolio shifts or other financial decisions.
  • Talk about your financial goals and the progress that you’re making toward them. You can talk about big-picture goals as well as any small goals you’re working toward like a vacation or splurge purchase.
  • Work on a simple budget for the month to come. You don’t have to make a complex budget to stay on track. Use the prior month’s spending patterns as a guide and tweak it for any anticipated expenses in the month to come.

Remember: Always be respectful and transparent.

Money can be a hot topic in a marriage, especially if you’re living on a fixed income. Holding regular meetings and being transparent about how you each spend money can help you keep the lines of communication open in your family. Many conflicts about money can be avoided simply by talking before the money is spent.

Don’t Leave Your Spouse in the Dark About Money

Many couples prefer to divide household tasks and take on separate family responsibilities. However, when one member of the couple handles all financial chores, the other spouse may find himself or herself in the dark about the family finances. Consider these questions together to make sure you and your spouse are on the same page about your finances:

Does my spouse know how to access all accounts and documents?

We strongly recommend that both members of a couple (and possibly a trusted child or relative) know where you keep all documents and are able to access financial accounts. In the event of a death or health emergency, fast access can be critical to ensuring your family has what it needs to get through the crisis.

Financial account details, life insurance policies, health directives, wills and powers of attorney are all critical documents that may be needed at short notice. Make sure you keep them in a secure place such as a fireproof safe bolted to the floor in your house. Safe-deposit boxes at banks can be hard to access during non-business hours or by someone who is not on the account documents.

Is my spouse prepared to take over the finances if something happens to me?

One of the biggest reasons to involve your spouse in the family finances is to prepare him or her for a future without you. If something were to happen to you, your spouse might be unprepared to manage financial responsibilities.

The easiest way to help your spouse prepare to take over is to involve him or her in major decisions and hold regular family meetings to talk about finances. Though your spouse may not want or need to know the nitty-gritty details of every aspect of your financial life, make sure he or she knows the basics about budgeting, investing, insurance and money management.

Does my spouse know our financial professional?

If you usually visit your financial professional alone or mostly communicate over the phone, it’s possible that your spouse doesn’t really know what we do. Bring your spouse to meetings and make sure that he or she feels comfortable asking questions and contacting us in need. We have helped many “non-financial” spouses better understand the family’s finances and would be happy to be of service to your family.

Will the Brexit Affect American Retirees?

If you’ve been watching the news, you probably know that Britain voted to exit the European Union (EU) on June 23rd after being a member of the European community since 1973. The shocking news caused financial markets to whipsaw, and people around the world to ask: What’s next?

No one knows what happens next because the Brexit is unprecedented. Since the referendum wasn’t binding, there’s no clear timeline for when or if the Brexit will happen or what its long-term economic effects will be.

When market shocks occur, it’s natural to worry about your own financial future. Though we can’t predict the future, we can make some educated guesses about how American retirees may be affected by the Brexit.

Here’s what we think:

1. Retirement savings invested in stocks will be volatile in the short and medium term. Market pullbacks are a normal part of stock investing and retirees should be prepared for increased volatility in the weeks and months to come.

2. Fixed income investments like bonds and Treasury securities are rallying because they are often viewed as safe haven investments during times of uncertainty. The price increases eat away at the income-producing ability of bonds, which have already been low in recent years.

3. Interest rates are likely to stay low in the near future. The Brexit makes it unlikely that the Federal Reserve will raise interest rates until late this year or possibly next year. Lower interest rates make it cheaper to finance housing and other major purchases, which could give our economy a boost.

4. On the other hand, the U.S. dollar is gaining strength against the currencies of our major trading partners; a strong dollar eats away at demand for U.S. exports and could damage corporate profits of firms that depend on foreign revenue.

Our view

Market shocks happen with some frequency, and knowing how to manage your own emotions and expectations is critical. As professionals, we help our clients build financial strategies that are designed for a variety of market conditions.

One of the benefits of including insurance products like annuities in your retirement strategies is that they can help manage the effects of volatility on your retirement income. Annuities have drawbacks to consider such as a lack of liquidity, fees and a potentially smaller inheritance for your heirs. However, they are worth considering if you are worried about how market events could affect your retirement.

If you have questions about the Brexit and your retirement strategies or want to know more about staying focused during volatile markets, please give us a call.

Want to Retire Early? Do These 4 Things.

Though it may be hard to imagine retiring early, many Americans manage to do it while still living comfortable lifestyles. If you’re serious about ending your career early, think carefully about the challenges you face: preparing for 40 years or more in retirement, drawing on your savings early and finding ways to fill your time. However, there are some moves you can make now to help you achieve your dream of retiring early.

1. Make early retirement your biggest priority

Keeping your eye on the retirement prize can help you make smart financial decisions and avoid inevitable temptations. If you’re married, make sure that you and your spouse agree on prioritizing early retirement over current spending or other life goals. Though you can’t control markets or how much income you bring in, you can control your spending, which is one of the most important variables in the early retirement equation.

2. Save aggressively by socking away 30% or more of your income each year

If you’re aiming to retire years ahead of schedule, you can’t afford to be stingy with your retirement savings. Assuming you didn’t get an early start on retirement savings in your youth, you may need to put as much as 50% of your income toward retirement. Your savings goal may require you to downsize your house, keep your cars longer and reduce your spending on luxuries. Another advantage of saving so aggressively is that it will teach you to live on much less.

3. Define what retirement means to you

Retirement looks different for everyone. While some people view retirement as an endless vacation, most who aim to retire early see it as an opportunity to change gears and build more flexibility into life. If your definition of retirement includes earning income through an encore career, part-time work or another source, you may find it easier to retire early. One of the primary challenges of early retirement is funding all those extra years through your investments. Reducing the income you must draw from your investments can be a huge help, especially in years with low portfolio returns.

4. Figure out where you’ll get health insurance

Since most Americans don’t become eligible for Medicare until age 65 (there are some exceptions), you’ll have to find an alternate source of health coverage. Private health insurance can get expensive as you age, so it’s best to evaluate your options early. One option would be to coordinate your retirement with your spouse to remain on employer-sponsored insurance longer. If you need to bite the bullet and purchase insurance on your own, you may qualify for federal subsidies based on your income. A financial professional can help you choose the best strategy for your situation.

Keep Working in Retirement with an Encore Career

If you’re like many Americans, the idea of spending your retirement on the couch isn’t all that attractive. The good news is that baby boomers are using their numbers and influence to redefine retirement. While some fill their time with hobbies and travel, many are choosing to take on “encore careers” that combine their passions with a paycheck. One survey found that over the next 10 years, 25% of boomers want to start a business or nonprofit; half of those surveyed hope to make a difference in the world while earning money.

There are some obvious financial benefits to earning income in retirement. You can make up shortfalls in your retirement nest egg by continuing to save, and you can give your savings more time to grow by not drawing them down for income. Delaying claiming Social Security benefits will allow your monthly benefit to earn additional retirement credits (until age 70), and eventually give you a larger stream of guaranteed government income.

The rewards of a second career can also go far beyond the financial. Many encore careerists find it very satisfying to mix their passions with the experience they gained in their primary career. For those who want an active retirement, finding a meaningful way to spend their time keeps them connected to the community and engaged in the larger world.

Encore careers come in all shapes and sizes. Many boomers enjoy teaching at local schools, community colleges or nonprofit education centers. Others use the skills they gained during their primary careers to become consultants and coordinators. Still others shift gears completely to pursue artistic passions like music, painting, or drama. What’s important is that your encore career fulfill your passions and bring in some extra money.

If you’re interested in pursuing an encore career, here are some tips to help you get started:

  • Start by writing down your goals and interests and think about how you could turn them into satisfying work.
  • Take classes at your local college or lifelong learning center to pick up new skills.
  • Think about how much you’d like to work and what kind of environment would interest you.
  • Consider taking a personality assessment and work competency test to learn about your strengths and zero in on the perfect encore career.
  • Look around for job opportunities and let friends, family, and others in your network know that you’re looking.

Life Lessons Retirees Can Learn From Muhammad Ali

Muhammad Ali, possibly one of the greatest boxers in history, passed away last week, leaving behind an incredible legacy of strength, perseverance, and vision. While we might not be world-class boxers, we can still take away some valuable lessons from Ali’s life:

Don’t let setbacks get you down

After becoming the heavyweight boxing champion of the world, Ali was stripped of his title and boxing license after refusing induction into the Army during the Vietnam War. Though his status as an outspoken conscientious objector earned him many enemies, he didn’t give up the fight and was eventually reinstated. However, when he returned to the ring after losing several years of his physical prime, Ali was slower, unable to dodge punches the way he did before, and lost to the current champ, Joe Frazier.

Undeterred, Ali reinvented his fighting style and returned to challenge Frazier, this time winning. Later the same year, he regained his heavyweight title after using his new “rope-a-dope” strategy to tire George Foreman and then knock him out. Ali successfully used his new style to defend his title in future fights.

Build a legacy that matters to you

After finally retiring from boxing in 1981, Ali became a well-known humanitarian, traveling the world to support peacekeeping efforts and raise money for charitable causes. Though he was retired, he was still one of the most recognizable faces in the world and used his public platform to fight for the causes that mattered to him. Even in his later years, when he had lost much of his physical vigor, he still made public appearances and signed autographs for his fans.

Fight the good fight to the end

By the time Ali died, he had been living with Parkinson’s for over 30 years. When asked if he regretted his years in the ring – which he believed might have contributed to his Parkinson’s – Ali said, “If I wasn’t a boxer, I wouldn’t be famous. If I wasn’t famous, I wouldn’t be able to do what I’m doing now.”1 Though his physical health seriously declined in his final years, he continued to inspire his fans through written essays and public appearances.


  1. http://www.nbcnews.com

Should You File Early For Social Security?

Social Security is a major source of income for most retirees, and deciding when to claim your benefit is critical to maximizing your guaranteed government income. Social Security rules changed in 2015, taking away two claiming strategies that helped married couples boost their lifetime income. Now that “file-and-suspend” and “restricted applications” are no longer allowed for most retirees, married couples have to think carefully about how to coordinate their benefits. Here are a few questions you should ask yourself when thinking about Social Security:

Do you need the income as soon as possible?

Many people are forced by financial circumstances to claim Social Security retirement benefits as soon as they qualify at age 62. However, if you claim early, you won’t receive the full retirement benefit you would have received if you had waited to claim until your Full Retirement Age (FRA). Instead, the Social Security Administration will permanently reduce your benefit based on the number of months before your FRA you file.

Are you or your spouse likely to live past age 80?

If you can afford to wait, delaying benefits until age 70 will allow you to accrue additional retirement credits, increasing your benefit up to 132% of the benefit you would claim at your FRA. Generally, if you or your spouse expects to live past the age of 80, it makes financial sense for the higher earner (or both) to delay claiming benefits until age 70 to maximize lifetime income. If health concerns or family history make it unlikely that either of you will live that long, it may make more sense to claim benefits sooner. A financial professional can help you explore your options and find the right strategy for your needs.

Do you need to maximize survivor benefits?

Widows and widowers are entitled to the larger of their own benefit or their deceased spouse’s benefit when they meet certain qualifications. If you are concerned about your spouse losing income after you die, it may make sense to delay claiming until age 70 to increase the amount of money your spouse would receive as your survivor.

How we can help

As financial professionals, we have helped many clients consider their Social Security and retirement options. We have access to professional-grade tools that allow us to test a variety of assumptions and scenarios to identify the best claiming strategy for your goals and circumstances. While online Social Security calculators can show you your income possibilities, we place Social Security in the context of your retirement, investment, and tax strategies to help maximize your overall income.

Teach Grandchildren These Lessons About Money

Grandparents are in a fantastic position to teach their grandchildren about money. Often, grandparents can more openly speak with grandchildren than their parents can. Grandparents often take on the role of family storyteller and children may be more willing to listen to their stories and lessons.

Research supports this view; a 2014 study by TIAA-CREF found that 85% of the young adults surveyed were open to discussing their finances with their grandparents. While just 30% of grandparents felt that they were able to influence grandchildren’s habits, 73% of the grandchildren surveyed believed grandparents helped shape their financial behavior.

Here are a few ways you can help your grandchildren learn the right lessons about money:

Share stories. Use personal stories and lessons from your life to illustrate your values about money. Children often love hearing family stories and you can use them to share important lessons about frugality, debt, and hard work. Use teachable moments whenever you can to demonstrate what you’ve learned along the way. For example, shopping together can offer the chance to talk about paying with cash instead of credit cards. Cooking a meal together can teach the value of eating at home versus eating at restaurants.

Teach with gifts. If you can afford to do so, giving grandchildren savings bonds, appropriate investments, or contributing to college savings accounts can also help them learn the value of saving. You can use the “three jars” technique to split money into: Save, Spend, and Donate categories. Money in the Save jar goes into saving for something the child wants; money in the Spend jar can be spent on whatever they choose or put toward a savings goal; money in the Donate jar goes to a charitable cause the child supports. This technique can help even young children understand the value of saving for what they want and sharing their wealth through philanthropy.

Involve grandchildren in financial decisions. Children often learn best by seeing direct examples of smart financial behavior and getting involved in the decision-making process. For example, when taking grandchildren on an outing, set a budget and offer them the opportunity to choose between activities that cost different amounts. When planning a family vacation, ask children to save money for a desired activity or souvenir. Getting children involved in the planning process and giving them a tangible way to contribute can increase their enjoyment and teach them valuable lessons about saving.

Grandparents hold a unique role in the lives of their grandchildren and can help teach them critical lessons about money. Don’t discount the value of your advice; helping your grandchildren learn smart financial habits can set the stage for a financially successful life.


  1. money.usnews.com

Should You Buy Guaranteed Acceptance Life Insurance?

Guaranteed acceptance life insurance can be a boon to people who can’t get term life insurance coverage because of age, medical history, or other issues. Applications don’t require medical exams or even detailed questionnaires and approval is usually guaranteed. This type of policy is designed for people who don’t qualify for traditional life insurance due to higher risk factors and is usually considered a last resort.

While a guaranteed policy might be a good choice for someone with medical problems or other issues that make getting traditional life insurance impossible, it’s important to understand the potential drawbacks.

Guaranteed life premiums are high – often many times as much as you would pay for traditional life insurance. Death benefits are also typically lower than traditional life insurance. With such high premiums, it’s often worth exploring other options for meeting financial needs after your death.

It’s also important to understand the full details of the policy you’re considering. Most life insurance policies come with contestability periods; during that period, benefits are typically limited and beneficiaries may not get the full death benefit if the insured dies.

Guaranteed acceptance life insurance may be a good choice for people meeting the following conditions:

  • Individuals with serious or life-threatening medical conditions.
  • The elderly who are too old for traditional insurance policies.
  • Individuals who have been turned down by life insurance companies.
  • Those who just want enough to cover final expenses.

If you are a high-risk candidate for life insurance, it’s a good idea to speak with a qualified insurance specialist who understands your overall situation. Together, you can find answers to questions like:

  • What is this life insurance for?
  • Is life insurance the best option?
  • How much life insurance do I need?

If guaranteed acceptance life insurance is the best option for your situation, a life insurance specialist can help you find the best policy for your needs and help make sure that you and your loved ones understand the details of the policy.

Why an Annual Financial Checkup Is Important

Most people have dozens of financial priorities competing for attention at any given time. Sitting down for an annual review can help you sift through those priorities and ensure that you are still on track to meet your goals. Though reviews are a personalized process, your financial checkup should cover the following general areas:

Financial goals: What are the goals your financial strategies need to support? Many people are working toward more than just retirement; some are preparing to send children to college and may need to provide future financial support once they graduate. Others have elderly parents or relatives who will need help as they age.

Savings: A review of your savings rate should answer the simple question: are you saving enough to meet your financial goals? If not, it’s good to know now so that you can make adjustments to your spending patterns and budget to boost your savings. If you are, you can feel good about being ahead of the game.

Investments: Many investors don’t pay much attention to their portfolio when markets are up. However, your long-term picture shouldn’t depend on short-term market movements. A regular review helps keep your strategy on track and gives you the opportunity to make changes where necessary.

Retirement preparations: Depending on where you are relative to your target retirement date, you may need to do a comprehensive review of your retirement strategies to determine how you stand in terms of your savings, withdrawal rates, and income targets. Even if you’re far from retirement, just knowing that you’re on course to meet your needed retirement nest egg can be reassuring.

Asset protection and preservation: Your annual checkup should also help you review your life insurance to make sure that your policies are still in force and meet your needs. It’s also an excellent opportunity to review the beneficiaries on your insurance policies, retirement accounts, and investment accounts. If you don’t already have updated estate documents like a will, power of attorney, and health care proxy, ask your financial professional to connect you with an experienced estate attorney.

Next steps

An annual financial checkup is an important part of executing your financial strategies and achieving your financial goals. Your goal should be to walk away from the meeting with a good understanding of where you are financially and feeling confident that you are headed in the right direction.

If you haven’t reviewed your financial strategies recently, please contact us to set up a comprehensive checkup.