Step Four: Arranging the Components of Your Plan

Building on step three, we will take a deeper look at those outside influences, paying close attention to the role your family plays in this process. This will involve a few personal finance refreshers, building a calendar of review dates, and a look back at what worked (and why) and what didn’t (and why).

Understanding Saving (Book excerpt) Some the earliest discussions about what we do came in the form of stimulating consumption rather than understanding why people save (so little or so much).  To recover from recessionary times, people are encouraged to spend. Preorder Target2025

Budgets (Book excerpt) We make numerous common mistakes when we attempt to budget.  The first is often the most costly.  Although it is often heard that you should begin investing early to garner all of the swings in the marketplace over a long investment career, beginning a budget is never mentioned in the nuptials, when couples decide to cohabitate or when we strike out on our own for the first time.  It is often attempted after-the-fact and by the time it is, much of the damage has been done. Preorder Target2025

The Face of the Budget (Book excerpt) While folks like Dr. YalingYang, Department of Psychology, University of Southern California, Los Angeles are attempting to put physical element to the act of deceitfulness – she has discovered that there is a difference in the white matter in a liar’s brain compared with the ratio of grey and white in someone who would not be considered pathological.  Yet, even those that would not cheat or malign, defraud or connive, dabble in the dark art of not telling the truth. Preorder Target2025

Slicing Objects (Book excerpt) We naturally expect to experience pay increases over time, offsetting the effects of inflation and taxes and providing enough extra money to support our growing families.  The expectation is often met with disappointment in younger families who are forced to borrow to make up for any expected shortfall. Preorder Target2025

The Parent Trap (Book excerpt)  It is not so much where they live but how they want to live.  For your aging parent, their house is probably part of their retirement plan (you, not so much and we will get to that in couple of minutes).  Determining how they want to spend those “golden years” the last generation to say that they really might be, depends on their health, the proximity to the kind of care they need, and how close you are in case of emergency (traveling to a from not only incurs travel costs but time away from work and your own family). Preorder Target2025

Mortgages in Reverse (Book excerpt)  The National Council on Aging has seen this trend as a positive development for the government. If seniors are allowed to take equity from their homes, this could keep a larger amount of people from looking to the federal government for assistance. Preorder Target2025

In the Long Term (Book excerpt)  Many policies have their own set of requirements. It is important to know when and how these criteria will be enforced. I’m skeptical of many of these qualifications. Policies issued now may have a wholly new set of hoops to jump through when the actual time you make a claim comes around. Preorder Target2025

Your House, Your Work, Your Plan (Book excerpt) Compiling a budget is as intimate as many of us are likely to get with another person concerning money – which might just be why so few work.  We all know that much like the science of discoveries, life is largely a daily trudge, a slog if you will that generally advances so slowly it almost seems stationary.  Is it how Jackson Browne suggests it is in the song “The Pretender”?  He sings: “I’m going to be a happy idiot and struggle for the legal tender”. Preorder Target2025

The Struggle for the Legal Tender (Book excerpt) This is the most difficult conversation to have, especially when it pertains to women.  Statistically, if women were paid the same amount as men for the same work, poverty in the United States would drop by fifty percent.  It would probably be a safe bet that the retirement accounts held by women would swell by the same amount. Preorder Target2025