With obligations to parents and kids, today’s retirees may feel the squeeze
By Gail Supplee Tatum, Columnist, The Times
The subject of finances is one that scares many of us because we aren’t even close to being prepared.
According to Money Magazine, one in three Americans have zero dollars in savings. CBS Money Watch calls us the “sandwich generation” because many of us have obligations to our parents and to our children. Less than one-third of all working adults haven’t managed to save any money towards retirement, according to a new survey by Bankrate.com. It states that 26% of people, ages 50-54 and 14% of those that are 65 and older, have no savings.
Thus, now during our ReFirement time, we must take the time to understand the health of our financial portfolio. If you know it looks unhealthy, ignoring it won’t make it better. Taking a deep breath and facing it is the only path to take. By the way, those of you who have a healthy financial portfolio….congratulations! Teach what you know, and the steps you took, to your children and grandchildren. You might also want to “pay it forward” and share your knowledge with your local community.
Here are 3 constructive tips to help you better understand and prepare for financial stability and peace of mind in your reFirement!
- List your assets, liabilities and your regular monthly bills. Get an overview. FeeX.com is a site that points out investment companies that have hidden fees and give free and clear information about how much we’re all paying for the privilege of investing. They call themselves, “The Robin Hood of Fees”! There is a site called bloom.com. They are a Registered Investment Advisory firm. Then there is GuideVine. This site will help you find a financial advisor in your area.
- Lay out your budget into two categories. What are fixed? What are discretionary? It goes without saying that fixed comes first. That would include rent/mortgage payment, electric, heat, water, cable, phone and any other bills that come in like clockwork. If your income is fixed, then what you have left over will be fixed too. If your income fluctuates, then you will have to budget for that trip or that Broadway show. I have found that if you do have a fluctuating income, it is very prudent to have different bank accounts for taxes, savings, and operating expenses. With each check that comes in, put 30% into the tax account, 20% into the savings account, and 50% into your operating account. You’ll thank yourself when April comes around!
- Change your habits. Change doesn’t have to be dramatic but it may be necessary, so face it and begin. The first step is the hardest. Keep in mind that small changes tend to stick much better, so pick the pace that works for you. Think about the areas that you pay more attention to and the areas that you pay less attention to. It is the latter that you need to pull the reigns in on. If saving is your struggle, then put aside something each week. If you say you don’t have enough income to save anything, start out with 5 dollars per week. Sounds silly? I guarantee you, that when you get in the rhythm; you will quickly realize that you can increase that amount to maybe $50 per week or $100 per week and so on. You will find that you will get more than the sense of accomplishment for building a savings; you will also gain a sense of peace and pride. How often do you say, where did the money go? Knowing that some of your money went towards building a savings will truly give you control of your future. There are things in our life that we have no control over and some that we do. It should be our desire to gain the wisdom to know the difference.
Educate yourself by reading articles and/or books from financial gurus, like Suze Orman or another that you can relate to and inspires you enough that you start making good habits. Get in the mindset of learning new creative ways to put your money to work for you. Always keep your eyes and ears open. Be listening and learning for new opportunities. Ask questions and be interested in what others are talking about. We never know where opportunity is waiting.
