Blog: 401k

Things To Do Before You Retire

Retirement
Retiring may seem like something that we just do, but it actually takes several years of preparation to understand when and how one will go about retiring and beginning retirement. You may look around at others who are already retired, some who are learning to enjoy their retirement, and others who have been retired for years, if you're able to meet them. I do know a 97 year old man, who has been retired for as long as he has been working. He retired over 35 years ago at 62 years old and is living in an senior-independent living facility.

There are several tasks that you can take now or even just a few years before you retire. These tasks involve assessing debts and assets, spending habits, and money flow or income. The more you do now to understand how and when you will retire will ensure an easy transition. Here are a few things to ponder about long before you hit retirement or if you are a few years away, or even planning to retire in the next few months.

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Bad Investments And Wasting Money

Bad
Have you ever thrown away money? Possibly on nothing? Yeah, me too. I've thrown away money on various food items, as I love to test taste them. I have thrown money into the stock market, only to have lost it the next day. I've spent too much money on water. I've spent too much money just by going out. I've even spent too much money on my ex-wife for the very purpose of keeping a civil friendship — and we don't even have any children together.

The fact is, for every dollar not saved for retirement, is a dollar not put away for your older self. How much could you really need during retirement? Well, your spending habits are unlikely to be that of a millionaires' lifestyle. What if you aren't putting a dollar away towards your retirement? For the most part, if you are working on the books, the government is putting some money away for you. Thank goodness for Mr. President Franklin D. Roosevelt and those who began drafting it years before him.

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Gambling In Retirement

Gambling
Do you ever wonder happens to the gamblers in retirement? It's very likely they are actually still gambling. Some of them quit cold turkey and never have the compulsions again, with lots of help from friends, family, and therapy, or a great money loss. Working in my mid-20s at a liquor store in downtown Chicago, showed me a side of Chicago that not many people get to see. I got to see young and old alike, poor and wealthy. Everyone has their addictions and a liquor store usually holds thousands of them.

I did see a 62 year old man we called Mr. Green, who walked into the liquor store every morning, afternoon, and night. He was a homeless man who was graceful, accepted his choices in life, from his first sip of the MD 2020 bottle, the green one, as is what earned him his nickname. He would never drink anything but the green. He was a guaranteed source of at least $10 a day, drinking anywhere from 3 bottles to 6 depending on how much he made from being out and begging all day. There was a time where he did piss himself and tried to hand off those pennies. We did not allow it.

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Should You Talk With A Financial Advisor?

Financial

A financial adviser is someone who advises individuals and companies on how to spend their money, especially if they have certain savings goals they are trying to meet. Although most financial advisers use applications nowadays, mathematics is heavily involved in understanding how to align quotas and meet expectations. Just because you consult a financial adviser does not mean you are financially in trouble, but most people who do are not likely to be disappointed in their choice of a consultation.

There are a variety of different companies that employ financial advisers from assets under $100,000 to companies who won't even deal with anything under $1,000,000 in assets. Many celebrities, who are paid millions of dollars, hire financial advisers to ensure they make the best decisions as there have also been celebrities who have overspent and misunderstood how many they actually had. For example, if you buy a mansion and a garage full of cars, all of those assets need to be insured, and this is often what causes many people to go bankrupt, especially lottery winners.

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Why You Should Use A Net Worth Calculator

Net

Most people hardly know what they are actually worth but when asked about their net worth, they might think this only accounts for what they have in a bank. For the vast majority of people, their savings and checking account amounts to less $20,000 for an individual and is not triple their salary by the time they are in their middle age. To calculate the average net worth, it is a simple formula of what you own that has value to it minus what you owe. Anything that is considered to have a value and can be sold is part of your net worth. In other words: assets - liabilities = net worth. [ Source: https://www.cnbc.com/select/average-net-worth-by-age/ ]

If you aren't worth much, don't worry too much. If you are young, you have your life ahead of you and time to obtain and grow your assets. Just remember that those with the most still die with nothing. However, while you are alive, it makes sense to acquire some assets in your name, and even use those assets to borrow equity or sell off for cash or something else of value. Many people use their assets to add more assets into their net worth, such as acquiring new property with downpayment by refinancing or using another asset as collateral.

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