Finding a Financial Mentor

Finding a Financial Mentor

I was challenged this morning by a pastor and friend who spoke to a group of fathers. The question initially posed was this: “What do I most need today in regards to decisions?” Answer: “Someone ahead of me, and someone behind me.” In other words, we were challenged to have a mentor and mentee in our lives. We briefly journeyed through the life of Luke in the Bible. Luke traveled with Paul. Paul was ahead of Luke. Luke also had Theophilus in his life who he mentored.

When we need counsel, we so often go to our peers who are most likely facing the same struggles (and making the same mistakes). Don’t get me wrong – I do think it’s helpful to share our struggles and burdens with peers; but are our peers best for counsel? Or could it be wiser to receive counsel from someone ahead of us in life and who has already faced the struggles? My pastor friend would argue the latter. How would this look for financial decisions?

Why can taking this step be hard for us? I’d say that simply asking for help doesn’t come naturally to us. We might be ashamed of our circumstances or situation. We might think that no one else gets it. We might think there’s just no better way than what we’ve come up with ourselves. As a person who struggles with trying to think myself through situations, I have come to learn that sharing and processing what I’m going through with others is extremely helpful; and that sharing with someone who is ahead of me is even better.

Think about financial decisions that you have made during your lifetime – the good, the bad, the ugly. How about buying your first house? First car? First timeshare (uh oh…). What did you learn? Now rewind: If you would have received counsel from someone at least ten years ahead of you, do you think the bad/ugly decisions could have been avoided? Probably so.

What about your peers? Most likely they are signing up for the same college credit card only to get a free t-shirt. Then yes, that “free” t-shirt ends up costing you hundreds to thousands of dollars in interest for the tv or vacation you really couldn’t afford. What if you had sought counsel from someone at least 10 years ahead of you who showed financial responsibility? Do you think that they would have advised you differently than your peers? Most likely so.

What about us – financial planners? We are experts in this field, but does that mean we don’t need to seek financial counsel from someone ahead of us? I have been challenged to seek out a financial mentor. Just as you, we’ve found that it’s 100% impossible to check all emotions at the door when it comes to our own financial decisions. We need sound guidance – the same guidance we give to our clients.

As we seek out a mentor, we’re also challenged to seek out someone behind us that we can help. How do we find these people? Pray that the Lord would bring these people into your life. Open your eyes to those already around you. They may not be far away.

In closing, I’ll share wise counsel that the speaker received from someone ahead of him during a critical time in his life: “Make decisions today that you will least regret in ten years.” That’s good. What’s this all about? Priorities.

So now what? Make that call. Send that text or email. Take the risk. I just did.

Living a “Just In Case” Retirement

Living a “Just In Case” Retirement

Very recently a couple of us from the office attended a retirement income planning seminar. The seminar was titled, “Don’t Live a Just in Case Retirement.” The presenter was Tom Hegna, an internationally renowned expert on retirement planning.

The seminar concepts were helpful and timely. Many points were reminders, but a couple of points struck a chord with me and are worth discussing.

One key point was this: “The success of your retirement is really not about assets.” Well, that’s controversial. Isn’t retirement about having a certain number? (i.e. How much do you have in your retirement nest egg?) Assets are lost, stolen, divorced, etc.

His argument was that the success of your retirement really depends upon how much guaranteed, lifetime retirement income you have. His argument is not just based on emotion, but research.

I have to agree. Our most joyful, content clients are the ones that know each month a set, guaranteed direct deposit is coming that doesn’t depend upon market performance. It’s backed by a pension guaranty, Federal government or an insurance company. This deposit is what used to be called the “mailbox check.”

But what’s the problem? There are fewer and fewer companies offering the pensions of one to two generations ago. It’s too costly and risky for employers. Therefore, we see defined contribution plans more today, such as 401ks, 403bs, and deferred compensation.

The risk has been transferred from the employers to the employees. The employees are in charge and responsible for saving enough for retirement. Problem is, how much is enough? Is it a certain number? We’ve dispelled that myth before. There’s no magic number that works for every person. Each person and financial plan are unique.

What’s the good news? We firmly believe a joyful, content retirement is possible, but it must come with a plan.

The second and last point that struck home with me was this: “How will you avoid risks detrimental to your plan?” Great question. Ignoring current and future risks is not wise. They need to be addressed. What are some of those risks?

  • Not maximizing your social security benefit
  • Inflation
  • Long-term care expenses
  • Sequence of returns risk (How the market performs in the early years of your retirement is a critical factor to be addressed.)
  • Longevity risk (outliving your assets)

The purpose of this writing is not to invoke panic and hysteria. Really, it’s not. I do, however, hope the items discussed moves you to taking action. “Any plan is better than no plan!”, said Tom.

And let’s not forget to address this topic from a spiritual standpoint. Are the items addressed above important? Yes. Are they ultimate? Absolutely not. For those who’ve trusted in our loving, heavenly Father, we know that our ultimate care is in His hands. So much so that he cares for us in this way:

Look at the birds of the air: they neither sow nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not of more value than they? 27 And which of you by being anxious can add a single hour to his span of life?[a] 28 And why are you anxious about clothing? Consider the lilies of the field, how they grow: they neither toil nor spin,29 yet I tell you, even Solomon in all his glory was not arrayed like one of these. 30 But if God so clothes the grass of the field, which today is alive and tomorrow is thrown into the oven, will he not much more clothe you, O you of little faith? 31 Therefore do not be anxious, saying, ‘What shall we eat?’ or ‘What shall we drink?’ or ‘What shall we wear?’ 32 For the Gentiles seek after all these things, and your heavenly Father knows that you need them all. 33 But seek first the kingdom of God and his righteousness, and all these things will be added to you.

34 “Therefore do not be anxious about tomorrow, for tomorrow will be anxious for itself. Sufficient for the day is its own trouble.” – Matthew 6:26-34 (ESV)

Living in the “already but not yet” is not easy. We know the ultimate battle has been won. We also know that on this side of eternity, the struggle and fight is real. Brokenness, hurt, loss and pain do exist. So how are we to respond? We trust. We follow. We love. We ask for help and forgiveness. And, we don’t give up.

Ask us for help. We’d love to walk alongside you through this journey of life. It’s not just about money for us. It’s a much bigger conversation.

Diets and Money – Quite the Pair

Diets and Money – Quite the Pair

You may have noticed (or not) that we took a two-month sabbatical from the Rivertree blog. We take advantage of the holiday season to plan, regroup and recharge for the new year. We are excited about 2019 and hope you are as well.

On a personal note, I am doing something I have never done before – a restricted diet. What exactly is a “restricted” diet? Well, prior to January 1st of this year I couldn’t have told you. But as of this writing, I’m now on day 29 of 30 and have learned quite a few things about food I never knew.

In the simplest terms, a restrictive diet is saying “no” to food groups that could potentially be harmful to your body. After the 30 days, you slowly re-introduce excluded food groups and see how it makes you feel. Sound like the Whole30 elimination diet? Well, it is.

My motivation for this diet was not to lose weight but to see how food was impacting my overall health. To say this diet has been enlightening would be an understatement. All my aches and ailments haven’t been cured, but I have certainly seen the benefits in eating healthier, wholesome foods.

So, what does dieting have to do with money? Well, quite a bit, I’d argue.

When I ran into Books-a-Million on January 1st, guess which books greeted me immediately at the door? You got it – money and dieting. Dave Ramsey, Suze Orman, Tony Robbins, Keto, Paleo, Plant Paradox, and Whole30 all shared a nice, wooden table that you couldn’t miss upon entry. I had settled on Whole30 prior to arriving, but I couldn’t help but thumb through each book on the table.

Then it hit me: What do we often say to our clients and seminar attendees as we discuss budgeting/cash flow planning? Give the system we teach a try. If it doesn’t work, you can always go back to your old system!

I was dreading saying “no” for the first time to many foods I love. But knowing that I could go back to my “old system” in just 30 days gave me what I needed, expecting that I wouldn’t want to go back completely.

Consider this quote about change:

““We change our behavior when the pain of staying the same becomes greater than the pain of changing. Consequences give us the pain that motivates us to change.

― Dr. Henry Cloud & Dr. John Townsend

Does this quote resonate with you? What are consequences of poor money habits or diets that might motivate you to change? Often, it’s a serious health diagnosis, high-balance credit card statement, overspending in retirement, or even bankruptcy.

Don’t let it come to these consequences. Start the process of change now. Dr. Cloud also says that change comes this way: Grace + Truth + Time = Change.

We hope 2019 is a great year of healthy change for you. If you need help or counsel to begin this journey, please don’t hesitate to contact us. We’d love to help.

 

For financial planning clients of Rivertree Financial Planning: Please contact us as soon as possible if you have had any changes in circumstances, objectives, goals or risk tolerance.

The Gap in Financial Planning

The Gap in Financial Planning

Have you ever assembled a piece of equipment, or perhaps a toy for a child, stepped back and admired your great handiwork, only to find a part (or two) leftover which should have been used? On the outside, your masterpiece looks flawless. On the inside, however, you’re wondering just how important those pieces are. That “gap” could be the most important pieces.

When it comes to financial planning, there is an area we most often see as the “gap” after 35+ years of us working with clients.

The “gap” is this: What happens to you and your family in the event of an unexpected death or disability? We can plan for your investments, savings, insurances, budget and retirement. And all of that is good. But what happens to your minor children in the event you pass away prematurely? I know…not a fun read for today. But, it happens, and we all need to have a plan in place for what we desire to occur when, not if, we pass away. What I am talking about here is an estate plan.

Let me address a few myths when it comes to estate planning:

1) Estate plans are only for rich people. False. Estate plans are for ALL people. We ALL have an estate (https://www.estateplanning.com/What-is-Estate-Planning/)

2) My family will just cordially work out who cares for our minor children. False. More often than not, a judge listening to both sides of the family makes the best decision that he or she can. Whew! How much easier this would have been with simple wills declaring his or her wishes for who should care for the children.

3) The courts will just work out what is fair for everyone involved. False. What is considered “fair” is relative to those involved. Did you know that in many states, Mississippi being one, a spouse receives the same percentage share of an asset as a child would should the deceased die without a will and the asset had no named beneficiary?

These are just a few myths that come to mind. Over the years, we have seen the heartache involved when a person’s estate is not planned well, or at all. They may have sufficient assets to care for loved ones. However, without a properly designed estate plan, disaster can occur, causing stress for loved ones.

We often get asked: “Should I pay an attorney to help, or could I write my own will?” Well, “yes and yes.” You should pay an attorney, and you can write your own will. However, we believe it is much wiser to get professional help, especially should a problem arise down the road. You can attempt to diagnose that continual headache, rash or stomach pain all day long using webmd.com. Or, you can pay a doctor who does this type of work on a daily basis.

So, what are essential parts of an estate plan? Our industry has called it the “Three-legged stool”:

1) Last Will and Testament
2) Durable Power of Attorney for Finances
3) Advanced Healthcare Directive

That stool could have a fourth leg for situations needing a Revocable Living Trust. We won’t go into detail on any of these today, but it’s worth bringing up each of these items to the attorney you choose.

I have observed that the hardest step is the first step – not just in estate planning, but in many important areas of life: Making that first phone call and asking for help.

I am a big believer in professional help. That includes the work we do as financial planners. All your ducks may be in a row, but it’s worthwhile to have a second set of eyes to make sure. We think you’ll be glad you did.

Why Everyone Needs a Financial Quarterback

Why Everyone Needs a Financial Quarterback

I’ve always loved sports – playing, watching, and understanding sports has always been a hobby. From my earliest memories, our family journeyed to various sporting events. One of my treasured memories was going to Atlanta to see Dale Murphy play for the Braves. He was my favorite player, and he did not disappoint in live view as he hit two home runs.

I’d argue that few things teach more about life than sports. You learn submission to authority, how to play as a team and work with people you like (and don’t like) to accomplish a greater goal. One of my greatest joys has been transitioning from being a player to being a coach. It’s a total gamechanger: who plays where, who bats when, and who attempts to explain the win or loss. It’s a blast, but being a coach comes with an enormous burden.

Think of your finances: Who is the overseer? Is it you? If so, that’s okay for now, but what about when (not if) you’re gone? How can you best care for those you love most with your finances? By having a financial quarterback.

Learning to Delegate

I distinctly remember a watershed moment early in my career. As my client base grew, I found it harder and harder to proactively manage 1) their investments and 2) their overall financial plan. I needed to choose: Do I want to manage investments, or do I want to do financial planning? I chose the latter and have not looked back.

Part of my growth was learning to let go and delegate, not just within my business but with my own personal finances. For example, I used to prepare my own tax return. And, it used to be fun. But was that the best use of my time and resources? No. I freed myself by handing that task over to a CPA.

Think of head coaches. They love to coach players and positions. But as a head coach, you’re now in charge of the overall game plan. You must delegate tasks to your coaches. It’s not easy, but the great coaches learn to let go and chime in during the game only when needed (insert: Nick Saban).

What gives me great peace of mind is knowing my wife and family will be cared for when I’m gone. They’ll have a team of experts surrounding them to hold their hands throughout the process. What a blessing!

So, reader, do you have a financial quarterback to care for those you love most when you’re gone? I know… It’s hard to let go. But you must for the sake of a greater goal.

We’d love to talk with you about being that quarterback for you and your family. Schedule a meeting today.