Posted by: Through the Eyes of Women | October 17, 2016

October 17, 2016, Is It Possible To Aim For Financial Security? Host Corinne Frugoni Talks With Ginger Weber, Financial Planner About Preparing For The Challenges Of The Future.

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Today, the good news is that we expect to live much longer, healthier lives. The bad news is that many of us will not have enough money to retire comfortably.  These days we can’t count on traditional pension plans, Social Security, or Medicare. Who, how and where can we turn to save and invest wisely whether for a down payment on a house, our child’s education, or a comfortable retirement, or for an emergency fund to pay for a car repair, broken refrigerator, or medical bill?

If you have a financial nest egg, large or small, should you try to invest it on your own or seek help from an investment professional?  If turning to a financial professional, what type of advisor is the best?  What kind of questions can you ask them? How do you decide to allocate your investments?  What’s the difference between stocks, bonds, mutual funds, money market funds to name just a few?  How can we convince younger people to save some of their earnings?

For years now, I’ve sifted through a lot of incomprehensible financial language to try and make some sound money decisions.  I’ve listened to a number of advisors explain many of financial terms and strategies and still had no clue.  I watched the movie “The Big Short” and had to have someone explain it to me. So when I sat down with Ginger Weber, I appreciated her ability to answer some of my questions in plain and simple English.

Ginger advises families, nonprofit organizations and businesses on a broad range of financial and tax planning and fiduciary issues.  She is a senior advisor and a president of Premier Financial Group in Eureka, CA.  Here are some recommendations she suggests in a newsletter that is put out by Premier Financial Group in Eureka, CA, where Ginger works as a senior advisor and as president.

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“If you are like many Americans who have not yet retired, you may be actively striving to get to a place in life where work becomes optional.  With so many people focused on eventual retirement, and a number of tools to help you get there, why does getting to retirement seem to be such a challenge?  Premier’s team finds that there are a number of obligations and expenses that are competing with an investor’s commitment to save and invest.  Here are some of the common items we find that prevent investors from saving more, in no particular order:

 

  • Cost of being a homeowner such as property tax, insurance and maintenance.
  • High home prices and refinancing with a higher mortgage balance, leading to large mortgage payments for longer time periods
  • Credit card debt
  • Car payments
  • Student loan debt
  • Medical bills
  • High cost of medical insurance
  • 401(k) loans
  • Child care costs
  • Saving for other needs such as a car purchase, remodel or sending children to college
  • Business fluctuations for business owners
  • Providing financial support to adult children or other family members
  • High cost of living such as eating out, shopping and travel
  • Taxes

So with all of these competing commitments, how does one get to retirement?  Well, it starts with planning and figuring out what your goals are and how you are going to get there.  You need to analyze your situation, determine if you are on track (a high percentage of people are not), and then look at the variables that you may need to adjust in order to increase the probability that you will meet your goals.  These may not be easy decisions, but here are some variables that may be adjusted to help you:

  • Downsize to a more affordable residence, if needed.  Having the mortgage paid off by the time you retire to reduce your monthly income needs.
  • Refinance your mortgage for a lower interest rate, if possible.
  • Pay off consumer debts more quickly so you can reduce your interest expense and start saving more for retirement.
  • Look for lower cost services, such as lower cost insurance and utilities.
  • Pay for child care expenses pre-tax through an employer cafeteria plan.
  • Borrow for children’s college expenses rather than covering from current income. This could help with current income taxes as well if you are deferring to a retirement account.
  • Increase household income, if possible.
  • Reduce discretionary expenses.
  • Ask your employer to start a company retirement plan if you do not have one, or possibly start a retirement plan if you are self-employed.
  • Work longer than planned.

You may notice an underlying theme, which is to increase the difference between income and expenses so that you are able to save more.  Then make saving automatic and be wise with your investing.  Make sure that your money is invested in a way that does not take unusual risk and does not sit idle in a bank account or money market earning low rates that are less than inflation.  It is also important to evaluate your investment management costs, as that can affect your overall results.  If you do the heavy lifting first by making a plan, then your retirement account with deferred tax liability and investment returns can help to do the rest.  Understanding your relationship to money, being patient and sticking to your plan are the keys to achieving your retirement goals.”

Ginger, along with her colleagues has also compiled a list of questions to ask an investment advisor which are listed below:

  • How are you compensated?
  • What are the total costs?
  • If you accept commissions, will you itemize the amount of compensation you ear from products that you recommend to me?
  • Do you accept referral fees?
  • Are you held to a fiduciary standard at all times?
  • Would you sign a fiduciary oath committing to putting my financial interests first?
  • Have you ever been disciplined by the SEC or FINRA (Financial Industry Regulatory Authority)?  If so, what happened? How was it resolved?
  • Do you provide comprehensive financial planning or just investment management?
  • Do you have many clients like me?
  • How ill you help me reach my financial goals?
  • What is your investment philosophy? How do you manage assets?
  • How much contact do you have with your clients?
  • What happens to my relationship with the firm if something happens to you?

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Periodically, Ginger and her colleagues at Premier Financial Group offer seminars on savings, budgeting, investing and financial planning.  Call Premier Financial Group or go to their website premierfinancial.com to get more information.

To listen to and or download this segment click the following link:

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