Something very encouraging is happening in the world of managing money.
More and more people are embracing the need for planning and advice. Big picture, long-term, multi-faceted planning can become a complex undertaking.
Not everything goes from A to Z in a straight line. There are always unexpected obstacles that can take us off course.
There are six major steps along life’s financial highway:
1) Asset accumulation with savings and investing, as well as debt reduction will help build your net worth and the strength of your family’s balance sheet. Concrete and well-planned strategies will often help remove the frustration of living paycheque to paycheque and start to focus on the progress towards distant goals, whatever they may be.
2) Preparing for retirement demands a thorough analysis of sources of income, expenditures and lifestyle choices for post-employment, which could easily last for 30 years or more. Unless there is a guaranteed pension plan in place, each of us are responsible for ensuring that there are adequate resources in place in order to enjoy a comfortable and carefree retirement. That entails solid planning.
3) Protecting our assets and family is also essential to provide support just in case bad things happen. Illness, accident or even death can put best-made plans off track in the blink of an eye. This is where proper insurance will protect our family members.
4) Help your executors by having a well-documented plan in place to transfer your estate to your survivors. Furthermore, the more complex your family dynamics become, the greater the need for an estate plan that maps out how you would like to distribute your assets and wishes. The choice is to complete this task properly while still living, or have your estate pay lawyers to correct the mistakes when you are no longer around to guide the process.
5) Managing the tax burden goes a long way towards reducing tax payments and increasing the after tax amounts left in your pocket. Tax planning looks beyond filing the annual tax return and looks at your future taxes in the decades to come.
6) Finally, knowing where the monthly paycheque gets spent is a great tool to start the planning process. This is called ‘cash flow management.’ Many people find this idea very helpful and informative.
Getting organized is an ongoing process that takes time and commitment.
Goals, priorities, concerns and worries are different for every individual and family and change over time.
Have you called your trusted financial advisor lately to ‘get organized’?
