The future is not so far away as you may think, and to quote a favorite line from W.H. Auden, “The years shall run like rabbits”. You may have noticed that as you get older, time goes by faster and the months begin to blur into years. Planning for the future you want to enjoy when you’re older, and taking action to secure that future, is paramount! We’ve previously discussed the nature of short-term goals, which are for saving money for emergencies, and six months of income in case you lose your job. Midterm goals, as you know, are for funds you’ll need in the next 3-5 years. Long-term financial goals are goals that may take more than five years to achieve, and consist of substantial outcomes such as saving and investing for a comfortable retirement, paying off all your debts including your mortgage, and perhaps building a legacy to pass on to your children and grandchildren. Achieving your vision depends on several factors, such as how much money you save and invest each month, how many years you save and invest, the amount of time remaining before you’ll need your funds for retirement, and reflecting carefully on the kind of lifestyle you want to enjoy when you are in retirement. We’re fortunate that in the United States there are a number of opportunities for accelerating your savings. One...

The purpose of your short-term goals is to set the foundation that prepares you for the sudden immediate financial needs of daily life, like having enough funds to cover a medical or dental emergency, unexpected car repairs, and stockpiling the equivalent of six months’ income in case your job situation is disrupted. Funding your short-term goals eliminates anxiety and helps you move forward so you can secure your midterm goals without the financial chaos that surprise expenses create. Midterm financial goals are different, and these are the funds you’ll need in the next 3-5 years. Some examples of midterm goals are such things as saving enough money to replace your car, pay off your debts, or finish coursework for a degree or certificate that advances your future financial situation. Because you’re planning 3-5 years out, it’s best to keep your goals realistic but also flexible. If you set your goals too high, frustration can prevent you from reaching them. While we’ve all mastered the ability to save money for an annual vacation or new bedroom set, when it comes to more ambitious goals, sometimes the price tag and the amount of time it takes to achieve goals with a longer timeline can require real personal effort and dedication to your purpose in order to stay disciplined for the length of your savings path. If one of your midterm goals...

Very rarely can significant gains be realized without first setting goals, and the first set of financial goals that serve as the base for your financial independence are your short-term goals. Short-term goals are for saving money for emergencies, and six months of income in case you lose your job. While most people focus on their midterm and long-term goals, they may be doing themselves a disservice by not taking care of the basics. Short-term financial goals are important because life sometimes presents unexpected surprises. Having a few thousand dollars set aside and easily available for an emergency is a smart thing to do. Having some handy cash will limit the anxiety and stress many people suffer during periods of uncertainty. Your Lifestyle Protection Plan is designed to help you preserve your current lifestyle until you reach retirement, and being prepared for setbacks like a medical emergency, the sudden need to see a dentist, or perhaps something that happens in your home like the refrigerator giving out, or flooding in the basement, or an unexpected visit to your automobile mechanic are all circumstances that are difficult to handle if you don’t have a set aside fund designed for unexpected emergencies. One of the features of your Lifestyle Protection Plan is being prepared by achieving solid short-term goals. When a difficult situation appears, you can’t keep it on the back...

Thoughtful people think about the lifestyle they want when they retire, and make plans to accomplish their goal. They think about where they plan to live when they reach retirement age, how much annual and monthly income they want to have, if their retirement includes travel for fun and to visit their children, how they choose to spend their time, and the activities they value. Usually people wonder if they’ll have enough money when they retire, a question that can be answered through the calculations of an experienced financial advisor. All the details of a retirement lifestyle can be monetized and a very accurate financial picture can be established that clearly articulates the amount of money that must be set aside annually in the time remaining before retirement to reasonably assure the desired lifestyle can be achieved. The key to attaining the lifestyle of your choice depends on the amount of time available before your retirement age is reached, of course. Another key factor is the amount of savings and investments that can be developed in the time remaining so there are sufficient resources steadily building wealth toward the total amount of money needed for the desired lifestyle. As you know, not everyone can achieve the retirement lifestyle of their dreams because of the interference of various factors that erode wealth. Divorce, illness, and poor choices are some of...

It may happen that because of a wide range of circumstances you don’t have enough time to close the gap between the amount of wealth you have today and the amount of wealth you need to enjoy the retirement lifestyle you want. Any number of reasons could have led to this situation, of course. Perhaps you started investing too late, or suffered heavy losses with your investments, or needed to use your funds for personal reasons such as health issues for yourself or a family member, or you were divorced…the reasons can be diverse. Nevertheless, this is the situation you find yourself in now, and you need to develop a Plan B going forward, and right away. There are a number of things you can do now to prepare for retirement and still build a nest egg that will support you in your later years. Here are five things you can do to improve your situation. 1. First and foremost, you should make an appointment with a financial advisor who can take a close look at your circumstances and help you create a plan to make the most use of the time and resources you currently have. Remember the adage, “You don’t know what you don’t know.” There could be a number of options available you haven’t thought of which could be brought to bear and make your path...