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Know Your Financial Destination & Plan Your ItineraryPosted by Roth-IRA-401k on: 2006-01-16 14:50:06 in category:
Retirement Planning News [ Print | Permalink / 0 Comment(s) ] Know Your Financial Destination & Plan Your Itinerary Planning your finances is a lot like planning a vacation. It sometimes feels like you need to take care of a million details. But whether you’re visiting a remote tropical island or planning a modest weekend getaway nearby, choosing a destination and dreaming about all the wonderful things you’ll see and do can be a lot of fun. However, along with all those pleasantries comes the added legwork of shopping for hotel accommodations and plane fares, as well as ironing out your exact itinerary. These tasks can be draining, yet once you embark on your journey, the extra time spent planning your excursion may seem well worth the effort. Drawing a map for your financial future is similar. You must know where you’re going and how to get there; otherwise you’re bound to encounter problems, or even get financially “lost” along the way. However, with a plan firmly in place, you can feel more secure that you are headed in the right direction. You’ll also be better able to adjust to changing circumstances and implement a predetermined contingency plan should the need arise. There are many facets of money management. Each part is equally important to the overall success of your plan. At one point or another, some stages of the planning process will outweigh others, due to personal situations and goals. However, eventually, each step will assume equal importance. Here’s a quick glance at some of the more important components: Personal Finances. Planning your day-to-day finances is an important first step in the overall scheme of money management. Without a firm grip on your finances, you may hamper your ability to meet long-term financial goals and objectives. Take a good look at your financial affairs to make sure you are not spending more than you earn. Once you feel confident about your short-term financial picture, you can start to look at more long-term goals. Personal Savings & Investment. One of the building blocks of your financial plan is your ability to save and invest undoubtedly, if you are able to diligently save, you can increase your chances for meeting realistic personal goals. Whether you are saving to buy a home, start a business, fund a child’s education, or secure a worry- free retirement, putting money aside on a regular basis is an important step in solidifying your future. Insurance. Insurance is a fact of life in America today. Without adequate life and disability income insurance coverage, how would your family survive financially should you suffer an untimely death or disability? To protect you’re and your family’s future, this question should be addressed when you begin to establish a long-term financial strategy. Updates along the way will keep your financial safety net firmly in place. College Funding. The average price tag for one year at a private college or university continues to climb. With the specter of even higher college costs in the future, it has become more and more challenging to save for a child’s education, or your own. The sooner you start, the longer your savings have to work for you. Be sure you work with a qualified college planner to attempt to access the hordes of free financial aid dollars available. Retirement Planning. The retirement landscape has dramatically changed over the years. Today, individuals are living longer than ever before; the future of government programs, such as Social Security, is uncertain; and retirement plan funding responsibilities generally have shifted from employers to employees. In addition, taxes and inflation can gradually erode savings. Therefore, retirement assets need to work harder and longer to meet retirement funding objectives. The multitude of retirement savings instruments, such as employer plans (401ks & Profit Sharing plans), Social Security, IRAs and Annuities has created an unprecedented variety of planning options. With this growth in selection comes a vast amount of financial information that requires careful consideration when establishing your long-term financial plan. Estate Planning. Transferring assets to future generations with the least tax liability is an important goal for many individuals. There are many planning tools that can help know your financial destination & plan your itinerary you achieve your desired results, such as trusts and wills. However, the complex nature of many estate planning strategies calls for a team of trusted advisors, including an attorney and tax professional to help ensure your plans are consistent with your goals and objectives. Putting it all together. Preparing a long-term financial plan is a complex process that involves research and careful consideration of both your short- and long-term goals. By identifying your goals now, you may be more prepared to create a financial strategy that best suits you and your family. Andy Barkate CRPS, CSA is the President of California Financial Network, a local Investment and Retirement Planning firm, with offices in Bakersfield, Lancaster and Ridgecrest.. Your questions and comments are welcome at 760-371-2115, 800-914-6837 or e-mail abarkate@calfinancial.com. |
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