And personal finance and the financial professional

Info icon This preview shows pages 10–12. Sign up to view the full content.

and personal finance, and the financial professional is the most highly qualified individual to lead this effort. Q: Which of the following retirement planning issues is (are) more prone to effect female clients? (select all that apply) A: more likely to have disrupton to income and savings while caring for a relative, typically more open to take advice than men, and greater potential for longevity. Roadblocks to Success " I have come to the belief that there are those who will never have enough money. That being said, if you don't live your life exercising self-discipline, you will certainly not fare well when the time comes to retire as our needs change (such as health care and living expenses). We have to adjust and be prudent." ~ Dan Drab (a student Fall 2014 in his mid-50s) One of the biggest roadblocks to a comfortable retirement lifestyle is poor planning and its close cousin is not planning at all. The US Census Bureau recently reported that the average 50-year old only has $43,797 saved for retirement. This should not be a benchmark to compare against. This should be an eye-opener that much of America will not experience the comfortable retirement as seen on TV. Other than old-fashioned procrastination, there are two different components of the American society that really work against people in preparing for retirement. One is carpe diem logic . Carpe diem is Latin for "seize the day." Far too many people live as if today is their last from a financial perspective. Just check out our national average savings rate if you doubt that this is real. (Links to an external site.)Links to an external site. If you knew that you would live for 50 more years and that you would not be able to work for the last 20 of those (but still needed money to live on), don't you think that it would be more prudent to buy a lower-tier car (instead of leasing a luxury sedan) and pass on the daily latte at Starbucks in order to make sure that you are saving enough for the longest vacation in your life... The financial sector has devised a process to help us encourage our carpe diem logic. This process is called financial layering , and it involves trying to create degrees of psychological separation between you and your money. Think about this...you earn a finite amount of money with which you can meet your various needs and desires. Are you more likely to spend more on a single item if you pay in cash or with a credit card (or Apple Pay, etc.)? When you need to count out bills, you will be more mindful of how much you are spending. When you pay with a credit card, it somehow becomes less real and you are more prone to over-spending. Is your monthly credit card statement a surprise or do you know exactly what you are spending? What about when you go on vacation to Disney World and they ask you to set up charges to your room using your Magic Wristband. Now, you are even one more layer removed from cash. It is a good budgetary practice to pay cash for regular monthly expenses, like groceries and
Image of page 10

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

gas, based upon whatever budget you set up. Only use credit cards and other multi-layer products (like
Image of page 11
Image of page 12
This is the end of the preview. Sign up to access the rest of the document.
  • Spring '14
  • VOSS,JAMESA
  • Cash balance plan

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern