People today are more responsible for their own retirement income security. Over the past 15 to 20 years there has been a shift in responsibility for long-term well-being away from institutions (employers, the government) to individuals. For example, in 1980, 70% of pension plans were defined contribution (DC, as opposed to defined benefit plans; DC plans shift more of the responsibility for the growth of retirement funds to the consumer); by 1997, 92% of plans were defined contribution (Conte 1998). In 1988, one-fourth (25%) of workers were covered primarily by DC plans; in 1998, over three-fifths (63%) were covered by such plans (Copeland 2002). (more…)

You also must make choices about how you spend money. For example, would you buy the $129 pair of sneakers you saw at the mall or save that money? You cannot do both, because most people have a limited amount of money. To help make choices, consider the time value of money, which is the increase of an amount of money due to earned interest or dividends. (more…)

In examining your financial condition and setting financial goals, you succeeded in nailing down where you are and where you’re going financially. But it’s important that you conduct these exercises at least annually. Keep the cash in a checking account, and watch it disappear! Wouldn’t it be better to put all the money you’ve saved on that extravaganza toward financing your child’s pay college education? (more…)

Like financial resources, your personal resources—your health, knowledge, skills, and time—require personal finance management. Do you eat a lot of junk food and avoid exercise? Do you get enough sleep each night? The decisions you make about your health now can have consequences as you get older. (more…)

Throughout your life you will have many different financial needs and financial goals. By learning to use your money wisely now, you will be able to achieve many of those financial goals.

Financial planning involves choosing a career, and then learning how to protect and manage the money you earn. (more…)

Successful financial plan must include or take into account the following condition:

- It is based on ‘hard’ facts, such as age, earnings, health, investments; and ‘soft’ data such as attitudes, beliefs and values.

- The plan must be a clearly written, logical document that uses language appropriate to the individual. (more…)

The first thing when setting financial goals automatically should be an emergency savings plan fund designed to cover six months’ worth of living expenses. Make sure it’s enough to cover any emergencies—like a job loss, car repair, medical or dental expense, or natural disaster. This way, you won’t have to tap those high-cost credit cards crisis! Plus, if you have any investments, you won’t be forced to cash them out when they’re down in value. (more…)

Current economic conditions also affect your personal financial decisions and how economic conditions can influence financial planning. There are three important economic conditions: 1. Consumer prices, 2. Consumer spending, 3. Interest rates

Consumer Prices (more…)

Ever since economists and the media began focusing on what they heralded as potentially the single largest generational transfer of wealth in history—bequests to baby boomers from their parents—my clients caught patrimony fever. Even if you could inherit a small fortune (and I don’t think you will), I don’t think it’s something you should plan on or dream of. And it’s certainly not a process you should try to replicate with your own children. (more…)

Like any company, you and your family members need to develop your overall financial goals. This process is definitely a family affair. (No family or significant others involved with your financial affairs? In that case, you’re on your own.) (more…)