Do you know how much to save?
This is a question I am asked frequently. I respond with “it depends” followed by a series of questions. There are many rules of thumb used to answer this question. A “rule of thumb” is a rough and easy estimation. It is not based on a specific situation.
Following are some of the questions that should be asked. What is the purpose of the expenditure? How important is the expenditure? Is the expenditure something that is needed, wanted or just a wish? What are the alternatives? Is the cost known? When will the expenditure be made? An estimate can be calculated once the variables are identified.
The savings and the variables need to be monitored. Life is a journey with many twists and turns. There will be many unanticipated expenditures, opportunities and windfalls. You need to identify what you did not plan for so that you can identify when you need to change what you are doing
Financial cycles may impact your ability to meet your expectations. The available rates of returns will vary. If you anticipated too high of a rate of return, you will save less than you planned. If your earnings do not grow as much as you anticipated you will have less than you expected. If your living expenses increase more than your income you will not meet you goals. If the reverse happens you will save more than you planned. That is easier to deal with than not saving enough.
You should monitor your savings and review your goals at least annually. The sooner you adjust to adverse events, the easier it will be modify what you are doing and improve your ability to achieve your goals.
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Social Security has improved the information available online
“my Social Security” provides improved information applicable to you. Information and tasks available includes: your benefit verification letter, your benefit and payment information, your earnings record, ability to change your address and phone number. Start or change your direct deposit of your benefits,
This allows you to obtain information when you need it. It will save your time and eliminate the need to travel to a social security office to obtain this information. It avoids the delay of getting information that is helpful in your financial planning.
The website address is: http://www.socialsecurity.gov/myaccount/
Some people cannot receive or acknowledge LinkedIn endorsements
I am such a person. I greatly appreciate all the endorsements I have received. The current state of financial regulations prohibits testimonials. LinkedIn’s “Skills & Expertise” are endorsements that are considered testimonials. The spirit of these regulations is to prohibit comments about the conduct or performance of an adviser. The best information currently available is that making endorsements would also be prohibited.
I am permitted to have your endorsement in LinkedIn as long as it is hidden. When and if the regulations are changed I can quickly unhide them.
Increasingly people are using the new features available through social media. Those of us that are subject to the restriction are frustrated. A recent article in “Reuters” discusses this matter in more detail at http://www.reuters.com/article/2013/01/23/us-social-media-idUSBRE90M1G020130123
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