My Own Financial Planning

First, let me say that I am NOT a financial adviser. In fact, far from it, this is one of the most difficult areas for me to navigate. I’m not dumb, don’t have issues with math, and I understand the basic principles involved. But the plain truth is I abhor, to the core of my being, the thought of having to manage my own portfolio. The limited times I have tried it have not ended well. Some of that was my fault – some of it was simply that the stock market goes through cycles and there is ALWAYS the possibility a person will lose a lot; possibly everything. I don’t like to think about my money every moment of every day. And if you are managing your own portfolio, it takes lots of research and activity on your part. Some people love it. I do not. Neither does my husband. Knowing this about us, we specifically chose to seek out a company to help us with our retirement portfolio.

Even having made an informed and researched decision, I sometimes have moments of heart-clenching fear. When I look at my “numbers” and see an odd drop, I immediately begin to doubt all my research, my gut instinct, the whole process of retirement planning. Let’s face it – we typically have one shot at earning what little retirement monies we have at the end of our careers. Realistically, barring winning the lottery or the death and inheritance of a big sum from some heretofore unknown relative, what we have is all that we will have to get us through to the end of our life.

Our retirement “goals” are pretty straight forward: we want enough money to have a roof over our head, utilities paid, food, and average medical bills to be paid. And an occasional Starbucks. We don’t travel a lot, we don’t have a lot of expensive entertainment needs. We do not want to burden our only child with our end-of-life care. If we are exceedingly fortunate and do not have some unexpected medical expenditure, do not lose our home to a force of nature, and we continue to be frugal, we MIGHT make our goals on what we have saved and what little Social Security and Medicare will cover. That is, assuming Trump and the Republican Party don’t completely destroy this country and the future for its citizens. But that’s another post.

So here is what we did and my limited “recommendations” to average people moving toward and entering retirement.

1. Do some research, talk to friends, interview some financial planning individuals and/or companies and pick one. We chose Ameriprise based on recommendations, research, and gut-feel after meeting the people on staff. We love our adviser, Jenny Funderburk. She is conscientious, honest, well educated, a terrific communicator on difficult financial topics, and has the same basic values that we do – which is important when it comes to developing trust and reliance.
2. Never, ever agree to buy additional products through any financial planning company “in the moment”. Go home, research your options, and sleep on it a bit. No matter how pressing the argument, like a diagnosis for a serious illness you usually have plenty of time to decide on the correct protocol for maximum health.
3. Do your best to save six-to-12 months of your salary BEFORE you retire. Put it into something safe and out of which you can easily withdraw it when needed. Respectfully decline offers to have this money invested for you. Invariably getting money out of a system is harder than either the company or you expect. It’s just the nature of the business – what is already “in hand” wants to stay “in hand”. In today’s world of non-existent interest, this means this little bit of money will not grow. But neither will it inadvertently be lost to you. It’s a trade-off. (NOTE: The caveat to this recommendation would be to those who earn WAY above the average folks typically reading my blog. For those of you in that enviable position, get advice on how to make your larger sum accessible and yet earning at least some value while it sits.)
4. Do not spend this money on ANYTHING until you have no other choice. Don’t go into debt – but do not use this money for trips or luxuries. Save this money for the inevitable car breakdown, the death of your heating and air system, an unexpected medical co-pay.
5. Spend this money before you pull anything out of your retirement accounts.
6. Keep putting money regularly into this savings after you retire. Even if it is just $10 a month. For as long as you can afford to do so. Most of us will have several years of reasonably good health and lower costs after retirement. Take advantage of that window to save whatever additional money you can.
7. Get Jeff Yeager’s book “How to Retire the Cheapskate Way” (Amazon has a great collection – including Kindle versions) and read it. Over and over. Not only is there good advice between the pages, there is also a huge dose of good humor and encouragement.
8. Within the last year before you retire, and while you have good insurance (if you are so blessed), get as many of your basic medical tests completed as possible: colonoscopy, a good overall health check, shots, mammograms, prostate exams, etc. Get all your recurring medications refilled at the maximum allowed in the last month before you retire. This gives you a bit of breathing room to figure out the inevitable changes to healthcare that follow retirement.
9. Don’t obsessively look at your investments. It will be discouraging. If something is really bothering you, contact your adviser and talk with them until you feel better or until you all decide on a course of action that will make you happier. It is YOUR money. Sometimes you need to be talked off a ledge and a good adviser knows this and will help you. But if something ultimately needs to be changed for your peace of mind, they should also be able to explain to you all the ramifications – good and bad – if that decision is going to be carried through.
10. You should be meeting at least quarterly with your adviser. Between meetings, make a list of questions/concerns that you have about your portfolio, practices you have learned within the company. Don’t be afraid to raise up any negative reviews you have come across and get more information. They should be aware and be able to discuss these with you. If not, start at #1 again.

Hope what helped us will be helpful to you. Next up: almost three months into retirement and things are getting better each week.