Goldstone Financial Group's Blog
Student debt is at an all-time high; about 44 million Americans hold almost $1.4 trillion in outstanding debts. The issue was hotly debated during the presidential elections, and higher education institutions have been soul-searching for innovative ways to help students deal with rising costs of education.
While the topic has gotten a lot of attention, though, the perception of those affected usually fits a certain stereotype: young millennials just starting down the road to a long-term career, with many years ahead of them to pay down their debt. The reality is more complicated. Currently, 6.4% of student loan borrowers are age 60 or older. That number is expected to grow as young Americans carry their debt further into their futures. Borrowers would do well to understand the resulting implications and the best ways to approach student debt as they get older.
Setting favorable terms for loan repayment
Some borrowers mistakenly think that their student debts will automatically be forgiven after a certain age. There is indeed precedent for this line of thinking; in the U.K., for example, federal student loans are forgiven when the borrower reaches age 65. This is not the case in the U.S., and federal loans are only cancelled upon the borrower’s death.
While this fact may be grim, it can still be used to the borrower’s advantage. Because older Americans are usually living on a set fixed income and federal loans are nullified upon death, it often makes sense to reduce monthly payments by arranging to stretch out the loan term. While this increases the total amount of interest paid, it serves to keep monthly payments to a minimum which can assist with budgeting purposes. Also, if the borrower passes away before the loan is completely paid off, the resulting loan forgiveness would end up reducing the total lifetime costs.
Additionally, borrowers should be aware that some loan servicer providers automatically enter borrowers into a repayment plan where costs start low and increase gradually, in anticipation of a recent graduate starting with a lower salary and slowly increasing their income. This arrangement clearly does not make sense for older borrowers on a fixed income, who should work with their servicer to arrange an alternate agreement that is a better fit for their predicted future income.
Forgiveness programs do exist
Although an automatic, one-size-fits-all forgiveness program does not exist, borrowers should be aware that there are still other avenues to help lessen their debt. Some older borrowers may be eligible for programs that help limit total payments.
While three-fourths of older borrowers with student loan balances are only holding balances on their own education, the remainder are holding balances on a child or other relative’s education. The latter may be eligible for an Obama-era repayment program called the Pay as You Earn PAYE program, which limits required payments based on earnings. Borrowers can check on the Federal Student Aid website to determine eligibility.
Another federal program of interest is the Income-Based Repayment (IBR) program, which caps maximum monthly payments at 15% of discretionary income. One of the most appealing aspects of this program is that after 25 years of continuous repayments, borrowers may be eligible for loan forgiveness for the remaining balance.
Be prepared to pay a Social Security offset
In 2005, the U.S. Supreme Court upheld the principle of “administrative offsets” that allow the government to collect on unpaid student loan debts by withholding Social Security benefits. The amount of the offset can range up to 15% of the borrower’s disability and retirement benefits, which may come as a surprise to elderly Americans who are depending on the income.
Many people are caught off guard is that Social Security used to be off limits for student loan offsets. Until 1991, there was a 10-year time limit on the government’s ability to collect student loan debt through administrative offsets. And until 1996, those offsets could not include Social Security. Now, though, 173,000 Americans received reduced Social Security checks because of unpaid student loan debts.
These factors are important to consider early so that Americans with student loan debt can be aware of the costs that may lie ahead.
Communicate with your loan servicer
The best repayment arrangement always depends on the specific circumstances of each individual borrower. To avoid getting lumped into terms that may not be the best for you, make sure to communicate with your loan service provider frequently and update them on any major changes. Open and frequent communication is the best way to help them help you.
As the adage goes, “a life without regrets is a life not lived,” but it is also “better to regret what you have done than what you haven’t.” The three biggest regrets of retired baby boomers center on the things they have not done and teach the next generation to make more informed choices.
1. Not Saving for Retirement Earlier
A rare absolute rule of finance is that people should start saving for retirement as early as possible, with the best time to start being in one’s twenties. Life expectancies are growing and show no signs of slowing down, so more money is needed to be stretched out for a longer period of time. Starting to save and invest as soon as one enters the full-time workforce can make a dramatic difference in the amount of money that accumulates by the time a person is ready to retire.
Many baby boomers failed to start saving on time and properly because they did not understand just how much money would be needed for their retirement. Some also did not know that receiving social security benefits or taking money out of retirement accounts before it is needed can have tax consequences that can substantially lower savings. Finally, many people tend to forget to adjust for inflation when considering whether they are satisfied with the rate of return on their investments.
2.Not Working Less and Traveling More
A study of 2,000 baby boomers commissioned by British Airways revealed that one out of five boomers regrets not doing more traveling around the world. The survey data also indicate that only 9% of American workers get more than nine vacations days per year and that only 37% of Americans took all of their vacation days in 2015, suggesting that working too much may be an issue whose scope extends far beyond just the baby boomer generation.
A 10-year research project conducted by Karl Pillemer, Professor of Human Development at Cornell University, into the lives of 1,200 people aged 65 and older also revealed that lack of travel during one’s youth is a common regret. He writes, “To sum up what I learned in a sentence: When your traveling days are over, you will wish you had taken one more trip.”
3. Not Working More
It might sound surprising given the decades of work they’ve done, but more than two-thirds of middle-income baby boomer retirees wish they had worked longer, and not for expected reasons. One might assume that people would want to continue working to keep earning their salaries, but for many baby boomers, wanting to keep working is about the work. People who are passionate about their careers and enjoy their work want to keep doing it. For this reason, many baby boomers return to the workforce on a part-time basis or as consultants. A number of baby boomers also enjoy working during their later years because they find that it keeps them mentally sharp, physically fit, and gives them a sense of purpose.
Life is full of unexpected situations that may have required you to pull from your retirement savings to cover pressing, unanticipated expenses. Although such situations can present challenges to the integrity of your retirement fund, there are several things you can do to reinvigorate your savings.
First, identify what caused the drain in your retirement savings. This step may seem obvious, but it’s important to take time to evaluate the factors that led to your emergent situation so that you can take steps to avoid them again in the future. With time and careful consideration, you can prepare for future unexpected situations.
Generally, it is advisable to save cash reserves to cover expenses for anywhere between three and six months. If you’re a homeowner, you should be able to cover six to 12 months. In addition, you should keep the amounts of the deductibles for your homeowners, flood, car, and health insurance. As an added precaution, set aside 1 percent of your home’s value each year for repairs.
Next, cut expenses and prioritize retirement. Because people spend the majority of their careers thinking that retirement is far away, other more immediate expenses often take priority over saving for a seemingly distant eventuality. However, dipping into retirement savings to cover an emergency signals that spending less on lower priority expenses may be necessary in order to recoup your losses. To help you accomplish this, refer back to the first step and evaluate what expenses you can minimize or maybe live without (at least for a while). Finding tax preferential vehicles such as municipal bonds, MLPs, and real estate in addition to the retirement accounts you already hold can help you get back on track as well.
Start saving small amounts to develop good saving habits and begin replenishing your retirement fund. Easing into monthly saving can help you get your retirement savings back on track without presenting you with a harsh burden. Starting by saving just 1 percent of your annual income in a company retirement plan helps you form a habit of saving. The 1 percent amount is small enough that it won’t be missed but big enough to keep the need to save for retirement fresh in your mind. It also helps you to save more as time goes on. By increasing the amount you save by an addition 1 percent of your income every other month, you will quickly be on your way to substantially rebuilding your retirement savings.
Eventually, you should increase your contributions to company retirement funds to the maximum amounts allowed by your 401(k)s and IRAs. Taking advantage of matching employer contributions will also be beneficial. If you are aged 50 or above, you can also potentially take advantage of up to $1,000 in catch-up IRA contributions and up to $6,000 for catch-up 401(k) contributions.
Pursue an extra job or income-generating side project to help fill in the gap.
Picking up a second job or an extra client or two can help generate additional income that can be set aside for retirement without impacting present-day expenses. If your spouse or partner does not work, having him or her join the workforce can be a great boon. Alternatively, if you are already retired, consider turning a hobby into an income-generating project. Or, apply to a big company, whose employee insurance plan can help cover healthcare costs. However, if you are unable to pursue any of the examples above, even simple things like tutoring or helping neighbors with some yard work can help supplement other income.
Delay retirement and social security to make sure you have more money for later. The best way to improve a retirement portfolio’s longevity is to delay drawing on it. Delaying retirement allows more time to build greater savings and also ensures that saved funds that you have accumulated will last longer into the future because they are being drawn on later in time. If you delay your social security benefits until after retirement age, your benefit grows with each year of delay.
If you’re a homeowner and your home has sizable home equity, consider a reverse mortgage. A reverse mortgage allows people aged 62 and over to receive tax-free cash in a lump sum or fixed payments. Moreover, the mortgage does not need to be paid until the homeowner moves out or dies. However, there are closing costs associated with this type of mortgage, and the homeowner must maintain the home. Although seniors often consider a reverse mortgage to be a last resort, it is a viable option provided that it is obtained from a reputable lender and that the homeowner understands how the mortgage works.
Goldstone Financial Group: 4 Reasons Why Considering the Impact of Spending Is Just as Important as Saving
Many economists agree that the personal savings rate in America is too low. Even though it climbed to 5.7% in late 2016, it’s still behind most other developed countries.
For instance, Switzerland households save 13.4% of their income. In Japan, workers have averaged a savings rate of 11.74% from 1970 to 2016.
For those looking to save more, what’s the solution? Obviously, making more money helps, but that may not be entirely possible for everybody.
What anyone can do right now is manage their budget better. Smarter spending equals higher savings—a good step towards ensuring a secure financial future. Here are 4 reasons why considering the impact of spending is just as important as saving.
1. A penny saved is still a penny earned
Benjamin Franklin’s famous quote is simple but profound. Anybody that’s worried about their financial well-being should remember it. Say it out loud, “A penny saved is a penny earned.”
Though most are familiar with this quote, it’s not being put into practice the way it should be. According to research from GOBankingRates, one in three Americans don’t have any retirement savings.
Cameron Huddleston, an expert columnist at GOBankingRates, believes this can be fixed. “There are plenty of obstacles Americans claim are in their way when it comes to saving for retirement,” she says. But things likes student loan debt, low wages, and a child’s education “don’t necessarily make it impossible to save for retirement.”
For those on a strained budget, the best way to save more money is to look at how you’re spending. There are many easy ways to save a few or even hundreds of dollars a month, from cutting the cord on cable to bargaining at flea markets.
2. Overspending carries future financial consequences
According to a study published in the Journal of Consumer Research, consumers overspend due to impatience and not thinking about long-term consequences. Examples of this play out every day.
For instance, 30-year olds probably don’t think about how buying a super-expensive TV today could negatively impact their quality of life at 65. That’s just so far away, and that TV can offer immediate pleasure.
This is what motivated the study’s researchers, Daniel M. Bartels and Oleg Urminsky, to look for ways to change this behavior. The two University of Chicago professors found that the solution is more complex than just thinking about one’s future self. While spending money, people must also care about their financial future. If someone doesn’t care, then spending less and saving more becomes less likely.
As Bartels and Urminsky say, “The best way to help consumers avoid overspending is to get them to both care about the future and recognize how their current behaviors affect the future.” Thinking and caring about the future is key to spending wisely today.
3. There is waste everywhere
Think of something like lean management in business. The core idea is to eliminate waste and improve efficiency. People should be applying this philosophy to the way they spend money.
Many may argue that saving is tough because all their income is spent on essentials, but research doesn’t necessarily support that claim. A survey by 24/7 Wall Street found that Americans spend roughly 15% on non-essentials (which means $15 out of every $100 doesn’t necessarily need to be spent).
Some common non-essentials include the following:
Eating out at restaurants
It’s worth noting that things that can be classified as “non-essentials” offer necessary relief from the stresses of life. Yet the fact remains that this is the primary area where wasteful spending occurs. Cut down any wasteful spending here and savings rates rise immediately.
4. Overspending leads to debt
It shouldn’t be a surprise that student loan debt can delay saving for retirement. It’s hard to stash away cash when lenders need those monthly payments.
For those that overspend and get caught in debt, the same idea applies. Habitual overspending makes getting out of debt—and saving—quite difficult.
It’s rather alarming that the average credit card per U.S. household is around $16,000. This indicates consumers are buying things without having the ability to pay in full. Carrying a credit card balance is necessary sometimes when the unexpected arises. But for many, high balances are simply a result of bad money management (overspending).
Also, since credit cards have higher interest rates, this means people are getting burnt by interest payments. That interest money could have been savings instead.
Saving more by spending wisely
In the end, it’s not necessarily about being stingy. It’s about spending more wisely. This means buying things at the lowest possible prices, staying away from unnecessary purchases, keeping credit card balances as low as possible, and more. If more folks start to pay attention to the impact of their spending, they’ll see their savings rise.
Goldstone Financial Group: Having Your Kid on Your Cellphone Plan is Affecting Your Retirement Plans
Providing for children when they are young is a common expectation. However, the situation gets more complex as children grow into adults but continue to need financial support. Known as “boomerang kids,” these children, aged 21 years or older, either live with their parents or continue to receive financial support even when living on their own. Parents want to help their children through the weak post-Great Recession entry level job market, but such assistance comes with the added cost of decreased savings and later retirements.
According to new data from the Pew Research Center, for the first time in 130 years, more young adults aged 18 to 34 live in their parents’ homes—32.1 percent of them—than on their own or with romantic partners. In such situations, parents often need to divert funds from retirement investing and saving to bear the added cost of providing for their adult child. A 2015 study conducted by Time Magazine revealed that, regardless of whether adult children live with their parents or not, 70 percent of parents polled spent up to $5,000 per year supporting an adult child, with 38 percent reporting having spent at least $1,000. Two-thirds of respondents aged 50 and older also indicated that they had provided financial support for a boomerang child within five years prior to taking the survey.
Such amounts may seem small, but they add up quickly, especially at a time when parents should be actively working on accumulating wealth and diversifying their income streams as part of their retirement strategy. Although parents and adult children both feel that assistance should not go on for long, the reality is that it stretches over longer periods of time than anyone is comfortable with. Even if parents spend just $1,000 on their adult child per year, the sum they lose from their retirement savings is even greater when they account for the loss in market-tracking index growth should that sum have been invested instead.
In addition to decreasing the amount of investments and savings, spending money to help adult children also results in people putting off their retirement. A study by Hearts and Wallets revealed that parents aged 65 and older who have financially independent adult children are twice more likely to be retired than their counterparts who are supporting adult children.
To help offset the financial burden of supporting a boomerang child, parents can set expectations and boundaries. Parents can ask boomerang children who live with them to pay rent or contribute to household spending in other ways. Regardless of whether their children live with them or not, parents can also help themselves and their children by assisting their kids with networking so that they can find a well-paying job and become financially independent. Setting boundaries and creating a plan for when a child will move out or assume increased financial responsibility can also be helpful in keeping parents’ spending in check. Finally, assigning household maintenance responsibilities or other chores may free up parents’ time to turn to turn their attention to financial matters.
Of course, each situation is unique, so there is no one size fits all strategy. Some boomerang children may be unable to secure a well-paying job while others are crushed by crippling student loan debt. Nevertheless, parents should strive to keep their retirement strategy in focus so they don’t run the risk of outliving their assets or having to ask their adult children to care for them later in life because parents spent their retirement savings providing for their adult children today.
photo credit: Wikidpedia
There is some good news for investors in the wake of all this market fluctuation: Downturns don’t necessarily require panic. This is especially true if you are working within a well-diversified investment structure that considers your future needs and your personal investment and financial planning approach. A recent article in Time Magazine cites the market’s historical performance as a source of comfort with regard to our current situation: “Back in March 2009 the Standard & Poor’s 500 was down 40%, but the market rebounded and delivered a historic bull rally.” This is all the more reason for investors to stay invested and remain diversified. In fact, this turn of events might actually afford investors an opportunity to increase their financial security.
While the wake of Brexit has been stressful on financial markets globally, it also marks an instance in which Goldstone Financial was able to use targeted strategies to make clients’ money work for them in order to actually strengthen their financial portfolios. Specializing in retirement security, Goldstone works with clients to balance active investment strategies with a conservative approach, which helps ensure financial security even in volatile markets. It’s in these downturns that we’re actually able to use our expertise to enable clients to participate in market gains, while still minimizing the risk of loss.
One aspect of this approach is using hybrid indexed annuities to help balance market volatility. Hybrid annuities are a staple in our investment approach throughout all types of market performance, but as it turns out they have been especially beneficial of late. And, according to a recent Financial Times article, “In the longer term, some of the stringent EU rules on the amount of capital that insurers have to hold to support their annuity may be relaxed ever so slightly and this will be good for annuities.”
Goldstone Financial specializes in hybrid indexed annuities, and recommends them in part because of our vast experience, and strategic approach. For example, we always participate in multiple indexes at a time, thus reallocating the risk of loss and maximizing the potential for gain. The “cost” of this, and annuities in general one might argue, is that there is a cap in the potential gain. However, our research and experience has shown that clients above a certain age who are looking toward retirement would rather be guaranteed a gain, than risk having none at all. These gains also offer flexibility of when they are credited to a clients’ contract—on a monthly or annual basis—so there is a sense of control on the part of the investor, which is extremely reassuring to our clients who no longer have a steady stream of income.
As with any investments, these are best executed and maintained with consistent tracking, customization, and navigation of limitations in accordance with clients’ need and future goals. It’s best to enlist the help of a professional who can navigate these variables, to help provide the best return on performance as related to the overall larger investment and financial planning goals for each client.
There are several other recommendations we make to clients who are concerned about their finances during Brexit and other difficult times in the market. Smaller cap options are looking better and better in the wake of Brexit, causing many to continue this course of action if already implemented. Reactionary investors have been pushing money into exchange-traded funds that track the price of gold and various indexes within bonds, but we recommend maintaining a longer-term strategy, even for our clients closer to retirement.
The best approach, however, is to remain calm and avoid making rash decisions during market events that will likely correct themselves. U.S. New & World Report reminds us that “investors who make sudden decisions to sell their assets may face transaction fees and negative tax consequences, and perhaps most importantly, they will not have the opportunity to regain these assets when the markets inevitably recover.” These are serious consequences that aren’t always considered in a panic. In a CNN article on the subject, Tobias Levkovich, chief U.S equity strategist at CitiBank, also cites that “trading on emotions generally is not a smart reaction to unexpected developments, and the U.S. has shown itself able to grow its economy even when Europe slipped into recession.”
Regardless of comforting predictions and expectations, these sudden changes bring on understandable stress. At Goldstone, we attempt to alleviate the pressure of these situations for our clients, precisely so that they don’t have to risk making damaging decisions in high-pressure moments.
Even as they enter their 50s and 60s, couples tend to avoid discussing their retirement. Although the subject can be uncomfortable because it touches on the end of life, not talking about retirement often leads to problems, both financial and domestic. To ensure that you and your partner are both well taken care of when you choose transition from the workforce, we recommend that you discuss the topics outlined below as early as you can.
- When do you plan to retire?
Because this question impacts both finances and lifestyle, it can often be the most difficult one for couples to resolve. Your partner may wish to retire early after a prosperous career, but you still feel satisfied in your work and are not yet ready to leave it behind.
The best way to get past a potential roadblock is to examine the impact one partner’s earlier retirement will have on your mutual financial situation. Having one partner remain in the workforce can increase retirement savings, grow your employer-sponsored pension, and delay taking out social security benefits, which can be helpful in making sure that neither of you run out of money once you’re both fully retired. Having one partner keep working may be especially beneficial in light of the fact that women are expected to live as much as 10 years longer than men, which could result in their living past their retirement savings.
- Where do you plan to retire?
This question impacts the kind of lifestyle you and your partner might want. Talk about your interests and the activities you wish to pursue in your free time. Depending on whether you’d like to live in a pricier urban setting or somewhere less expensive and more rural, the answer will also impact your finances. State income and property taxes, which vary widely, can also affect your decision. Whether to live in a house—which can require financial investments for upkeep as it ages—or to downsize to a condominium to free up more cash and have less maintenance activities to worry about is another key point to consider.
- What does retirement mean to you / how will we spend our time?
If you’re both retiring around the same time, do you or your partner plan to work part-time, whether to make extra money or simply to remain active, as many retired professionals increasingly do today? If one of you chooses to retire early, will that partner help the other in his or her professional career? Would you or your partner be happy spending your days pursuing exclusively non-professional interests? What do those interests include? Consider the costs of travel, theatre, family time, etc.
Developing a financial plan for retirement can help answer these questions. It is recommended that each partner prepare to answer these questions separately, as that will make your discussion more productive when you come together to merge your ideas into a unified plan. Do not let yourselves get frustrated if you cannot find common ground right away. Plans of this nature often take months of negotiation before they are set.
- Whose investment style will we follow to meet our mutual goals?
You or your partner may manage your own 401(k)s or IRAs as you move through your careers. This individualized approach does not need to change. However, the two of you should choose a financial advisor that can guide both of your individualized efforts to work together in an overall portfolio that serves your mutual goals. You should also discuss ways to keep your investment funds growing even after you begin drawing on them.
- Will we leave any money to our children and/or to charity?
If you’ve come to this point in your retirement discussion, it is likely that you have agreed upon the points outlined above to your mutual satisfaction. Still, this topic can also produce passionate discussion, depending on your family situation. After you agree upon the best ways to serve your family and legacy, we recommend working with a financial advisor to learn about the many different tools for passing on wealth to heirs or the charitable organization(s) of your choice.
Apt comparisons can be made between athletics and finance — even in terms of retirement strategies. Though retirees should have a trusted financial ‘coach’, the strategies and final decisions during game time is up to the quarterback — you. Brad Johnson, a former football player and current VP of Advisor Development, offered the three insights into how he turned his passion for football into a successful career as one of the foremost finance advisors.
Bend don’t break
Expect some losses but don’t accept them all. During volatile markets, investors oftentimes take flight. In long-term investing, this is the worst thing a retiree can do for themselves and the economy. If you can’t see past the burning forest, make sure you have a great team on your side to help advise you. If certain investments are “broken”, they should be able to steer you towards safer ground.
According to Brad Johnson, staying the course is the best way to ride out the volatility:
There was a saying we had as a defensive unit back in college when I was playing, “bend but don’t break” and I think it relates incredibly well to the mentality most retirees should take with their savings. You see in football it meant you can give up a first down or two on defense, just don’t give up the 60 yard [sic] bomb over your head or the big run down the sideline for a touchdown.
Don’t have all your players in one place
As mentioned in an earlier blog, much of the last 60 years of “tried and true” investing no longer reaps the rewards seen in decades before, however, one thing that does remain is diversification. Retirees should not be afraid of making certain risks but having a diversified portfolio, like diversifying your best players is a great tactic to employ. Using diversified retirement strategies like hybrid fixed annuities, IRAs, Roth IRAs, and the strategies mentioned here for retirement will spread out your best players.
This was drilled into us by our coaches and by making sure everyone was playing their position and role within the defense.
What’s interesting is that this exact same philosophy applies incredibly well to retirement and the need for utilizing tools within your retirement that all play a certain role. Just as you wouldn’t have an entire football team made up of 11 running backs, for most retirees they shouldn’t have an entire retirement nest egg made of high risk/high reward equities.
Have a good defense
As we’ve all heard many times: a good offense is a great defense. This also applies to retirement. The most prized asset in your financial portfolio is a Plan B. In other words, always prepare as much as possible. Your knowledgeable advisor is your best defense against making decisions based on misguided or incorrect intel. They should have the answers to your burning questions because they’ve played the game a lot more than you have! So don’t be afraid to confer with your coach.
With the help of your advisor, there are ways to implement safeguards that can help you grow and keep your money. In the words of Mr. Johnson, these advisors are a crucial way to keep all your “eggs” intact:
Going back to the “bend but don’t break” mindset, this is what sent many retirees looking for a part time job or caused them to delay retirement back in 08-09. Essentially their nest egg “broke” when the market was cut in half.
There are a number of tools available to help[s] create a sustainable base for income through retirement that help shield retirees from this risk – think of them like the offensive linemen on a football team, they don’t get much glory, but no football team could survive without them!
Like Brad Johnson, a financial advisor can help coach a retiree into strategizing the best retirement plan that will help them score a “touchdown” as Johnson puts it. At the end of the day, it is your retirement, your game so to speak; but with a keen knowledge of the playing field and a strong supporting team, a retiree can get to their end zone with a win.
While having plenty of money at your disposal during retirement is a goal for many, it’s not the only secret to happiness and fulfillment during your retirement years. Findings from the 2010 Health and Retirement Study Survey found that life satisfaction for retirees goes beyond income and wealth to include health, retirement decisions, and the quality of their social life.
Making retirement decisions early and working towards these goals could just be the path to happiness for many retirees. Here are some important things to consider when planning your post-retirement career:
Prioritize Your Career
If you managed to set aside a few million dollars through savings and investments during your retirement years, you may not want to explore jobs or a new career. However, if work fulfills you in some way, you will want to secure a position you are interested in and get paid well for given your years of expertise and experience. Results from a Merrill Lynch study found 72 percent of people over the age of 50 want to work in retirement and 37 percent of pre-retirees who want to work in retirement have already taken steps to prepare for their post-retirement career.
Consider Your Earning Potential
If you plan on working full-time during retirement to cover your bills and expenses, you’ll need to evaluate how much you need and what your income potential is based on the current job market. This can be stressful for some — especially if you have been out of the job market for a while — so doing some research, interviewing for different positions and setting some income goals can help you make a decision that’s right for you.
Factor in Socialization Opportunities
Opportunities to socialize may be limited if you end up working from home or stay out of the job market altogether. If you are a surviving spouse and live alone, you may need to be even more proactive about maintaining a healthy social life. Experts say retirees need to participate in social activities to maintain a healthy and meaningful life through retirement and reduce their risk of death. If you aren’t meeting up with friends regularly or staying active in your community in some way, you may be compromising your health and missing out on some valuable opportunities to connect with people. Make sure an active social calendar is part your post-retirement plans.
Review Your Financial Portfolio
Whether you were a diligent saver or an ambitious stock investor during your working years, now is the time to enjoy the fruits of your labor. Meeting with a financial advisor or retirement planner can help you determine whether you are managing your wealth effectively and how to distribute funds. You may be able to buy annuities, make additional profitable investments, and save money with some smart financial moves before and during retirement.
Take Care of Your Health
You may already be taking care of health and medical issues and seeing a physician regularly for checkups. Make sure you’re also taking steps to take care of your health in natural ways, by eating a well-balanced diet and getting regular exercise. Take care of vision exams on schedule, keep up with dental visits, and explore natural health or alternative health remedies to manage stress. Your retirement years will be more fulfilling when you have the physical and mental abilities to enjoy it all. Be proactive about your health, talk to your doctor about wellness plans and take medication on schedule to set yourself up for a healthy lifestyle throughout retirement.
Mapping out your post-retirement plans can be overwhelming but there are several things you can do to set yourself up for years of happiness and satisfaction. From reviewing your financial portfolio to re-entering the workforce, use these tips to set some goals for yourself during your retirement years.
When planning for retirement, it’s essential to consider multiple sources of income. Social Security may not be as beneficial as expected, particularly after taxes. Outside of pouring money into savings, pre-retirees should look into options for non-taxable income well before the time comes to call it quits.
Here are four ways to start building towards a tax-free future in retirement.
One of the best options for retirees looking for tax-free income is the Roth IRA. Unlike most other retirement plans, a Roth IRA grants a tax break on withdrawals rather than contributions. Direct contributions can be withdrawn at any time, without worry of tax or penalty. Earnings can be withdrawn tax-free as well, after a five-year period, and for individuals 59 and a half years of age or older.
The Roth IRA has advantages over alternative tax-free options such as municipal bonds. Though munis have no income limit, the interest they pay is generally less than taxable bonds, and they may be subject to state income taxes. Also, municipal bonds may be counted as a source of income for early recipients of Social Security, potentially hurting their pay if they make $15,000 or more.
Unfortunately, the Roth IRA has income limits that disqualify some people from making contributions. Many people hold off until after retirement when they enter a lower income bracket, though financial experts advise making contributions as early as possible for greater benefits down the line.
Roth 401(k), 403 (b):
Plans such as the 401(k) can accumulate huge savings as the employer will match whatever the employee contributes. The IRS also allows for Roth contributions to 401(k) and 403(b) accounts. While the Roth IRA has an annual contribution limit of $5,000 or $6,000 (depending on age), the limits on Roth 401(k) contributions are much higher and are not restricted by income eligibility.
Regardless, pre-retirees should look to max out their contributions to company-sponsored plans each year. It will pay off in the future.
Health savings account:
Some employers offer an HSA-qualified health plan, allowing employees to contribute tax-deductible funds that roll over and accumulate each year. These funds can be withdrawn at a later date to pay for various medical procedures, some of which may not be covered by health insurance.
A health savings account can eventually become a useful source of tax-free retirement income as the funds can be used as reimbursements for past medical expenses, or to pay for current Medicare premiums and health costs. Withdrawals are not subject to income taxation if made for qualified medical expenses.
Though most people look at life insurance as something that will only be of benefit after they pass on, it can also become a potential source of retirement income.
A life insurance retirement plan (LIRP) allows owners to contribute funds beyond that required by the plan’s premiums and later withdraw the excess cash tax-free.
According to expert Kevin Kimbrough of Saybrus Partners, these funds accumulate similar to an annuity but come with an added benefit.
“Unlike the annuity, you’re able to take your basis out first and that comes out tax free,” said Kimbrough to ThinkAdvisor. “When you get into the gains, you’re able to switch over and start taking policy loans against the income-tax-free death benefit.”
This method is usually better suited for higher earners, due to the fees associated with such an investment. It’s highly advisable that pre-retirees examine their portfolio, research and adopt a plan best suited for their particular circumstances.
“There are only two options in retirement: You can be working for your money or your money can be working for you. You have to be realistic and ask yourself if you really can retire when you’d like,” said finance advisor Christopher Kimball to Turbotax. “During retirement, it is critical to monitor your investments and current tax law. You should be positioned to take money from whatever ‘bucket’ is most beneficial at the time.”
Did you know that you will probably live longer than you think? Average life expectancy has grown by three months every year from 1840 to 2007 and shows no signs of slowing down. Family history is also not necessarily indicative of how long someone may live. Lifestyle choices such as diet and exercise can have a dramatic impact on the length of life.
Longer lifespans mean we have more time to enjoy the things and people we love most. But they also pose a unique challenge. What is the best method to save enough money to retire and live comfortably and worry-free?
In order to help you choose the best options for you, we have put together information on the pros and cons of some of the most popular, “tried and true” retirement investment strategies and highlighted their effectiveness in today’s life changing times.
Fixed and Hybrid Annuities
Annuities are a great way to save for retirement because they can potentially generate interest over a fixed time on a principal amount that is guaranteed. Because you are not required to annuitize—to receive payments at a regular interval from the annuity—certain kinds of annuities also offer the flexibility to leave money for your heirs.
- Straight Life
This is the simplest, least expensive annuity. It pays benefits until the death of the annuitant—the person receiving the funds—without an option to appoint a beneficiary.
- Life with a Guaranteed Term
This somewhat more expensive option allows the annuitant to designate a beneficiary. If the annuitant dies within the guaranteed term, the beneficiary will receive the remainder of the annuity in one lump sum.
- Substandard Health
This type of annuity is advantageous for someone with a serious health condition. Although the annuity will cost more the less the annuitant is expected to live, the payouts are larger than in an annuity in which the annuitant is expected to live a long time.
- Joint Life with Last Survivor
This annuity allows the annuitant to select a beneficiary who will receive payments regardless of whether the annuitant dies within a certain term. However, because of the added insurance component of this product, this is the most expensive fixed annuity.
- Hybrid (a.k.a. Fixed Indexed)
Fixed indexed annuities are known as hybrids because they invest your principal in the market, allowing for higher rates of return, but still guarantee the principal amount. Therefore, even if the annuity does not generate any additional interest because the market tumbles, your initial investment remains safe.
Traditional and/or Roth IRAs
Investment retirement accounts are an excellent, tax-efficient tool for setting funds aside.
People who contribute to a traditional IRA are able to deduct the contribution from their annual federal and state income taxes. However, once they withdraw funds in retirement, the withdrawal will be taxed as income. Conversely, contributions to Roth IRAs are not tax deductible but future withdrawals won’t be taxed.
Choosing the right IRA depends on several factors. Roth IRAs have strict and specific income requirements. Additionally, depending on the difference between the current and potential future tax rate, one type of IRA may be more advantageous than the other. Finally, traditional IRAs require you to take mandatory taxable distributions beginning at age 70½ whereas Roth IRAs do not require you to take any money.
A 401(k) is an employer-sponsored retirement fund that invests your money in order to generate more. This savings strategy may yield excellent benefits but may also be the riskiest option.
The amount of your annual contribution to your 401(k) is tax deductible. Additionally, many employers will match your contribution up to a certain amount—usually 3% of your annual income—essentially giving you “free” money.
First, the IRS sets caps on the annual amount you can put into your 401(k).
After you retire, withdrawals are taxed as income and may be taxed at a higher rate than your present tax rate. You may also not be able to withdraw your employer’s contributions until after the vesting period concludes.
Additionally, should you find yourself in need of money before the age of 59½, you will be subject to a 10% withdrawal fee.
Finally, 401(k)s grow your money by investing it in mutual funds. Whenever money is invested in such fashion, there is a risk that stocks can crash and that your 401(k) will lose significant value. Fortunately, you have full control over how your money is invested, so this risk can be minimized with some education about the market and less risky investment strategies.
According to the Employee Benefit Research Institute, 37 percent of workers are confident that they have enough money saved up for retirement. The EBRI’s 2015 Retirement Confidence Survey reveals confidence about having enough money for retirement has increased steadily after reaching record lows between 2009 and 2013, but today’s numbers reveal that less than half of working America is still unsettled or even anxious about their financial future.
Fortunately, there are several attractive options available for soon-to-be retirees. Those who are within a decade or two of retirement may be especially interested in purchasing annuities, which can be a valuable addition to retirement planning.
What Are Annuities?
Annuities are a unique type of financial product because unlike savings and investments you would set up with a bank, annuities are sold by insurance companies and financial institutions. When you buy an annuity, you are socking away money for a few years that you don’t expect to touch until the surrender period — the length of the annuity — is over. Although, most annuities allow up to 10% to be withdrawn annually during the surrender period.
One of the reasons why people buy Fixed Indexed Annuities is because they are looking for a no-risk or low-risk investment opportunity and want to protect their hard-earned money from income taxes. If you have already made your full contributions to 401(k) plans and IRAs and have some extra money available for retirement, you may consider purchasing an annuity. You can buy an annuity for several thousand dollars and earn tax-free interest as long as you don’t make any withdrawals during the surrender period. Of course, you will need to consider the fee structure and overall cost of your annuity before signing the dotted line. In many cases, annuities earn higher interest than bank CDs and savings accounts.
Generating Income with Annuities
You get to play investor when purchasing annuities and can choose from several different types — including multi-year fixed income annuities (MYGA) where you receive a guaranteed payout or a variable annuity where you receive a payout based on performance. Variable annuities, naturally, are riskier investments but offer more attractive returns.
If you want to receive payments as soon as you make your investment because you are very close to retirement or are already retired, an immediate annuity will be your best option. If you are comfortable leaving your account alone to earn interest that you can enjoy later, you can purchase a deferred annuity to defer your payment to a certain time.
When exploring different types of annuities, it’s important to consider what type of insurance company is guaranteeing the plan, what types of costs are involved, and what stipulations there are for termination of your annuity contract.
As many Americans struggle with the idea of not having enough saved up for retirement or wonder if they will be able to get by on Social Security and pension funds during retirement, it’s never too late to start planning for the future. If you are looking for financial products for our retirement strategy, don’t overlook the benefits of annuities. Tax-free earnings and flexible buying and earning options make annuities an attractive option for soon-to-be retirees and those who are already in their retirement years.
Goldstone Financial Group: The Biggest Problem People Have When Planning for Retirement, According to Data
An HSBC survey found that only 40 percent of Americans are regularly saving money for their retirement. Additionally, two other surveys from the Consumer Federation of America (CFA) and Employee Benefit and Research Institute (EBRI), reveal that only about 50 percent of those Americans have focused retirement goals and around 40 percent are saving for a realistic, sustainable standard of living.
To many, the biggest obstacle is obtaining accurate advice about the options, risks, and benefits of retirement savings, but that is just one of the problems facing retirees today. There are 5 other major struggles:
No Employer 401(k)
An EBRI analysis of a recent Census Bureau data reported that under 50 percent of employed Americans have access to a retirement plan at work. Of those that do have access to a 401(k), only about 40 percent participate. According to President & CEO of EBRI Dallas Salisbury, this 40 percent are really missing out. “Those who have workplace programs and are participating, they are doing significantly better than those who are not.”
If you have access to an employer-sponsored retirement plan, we can’t stress enough what a valuable asset that is to your future. For those who don’t have this option, IRAs are a good place to put aside money.
Unforeseen Life Events
Even retirees who are careful about for their futures face unexpected life events such as deaths, life-threatening illnesses, and accidents. When this happens, what we often see is retirees ceasing to contribute to their accounts, or borrowing against their retirement due to costs associated with these unforeseen events. According to the HSBC, 27 percent who face these struggles say they would borrow against their savings, 13 percent were prevented from working due to accident or illness, and 6 percent ceased working to care for a spouse, therefore unable to afford monthly contributions.
Executive VP of retail banking and wealth management at HSBC Bank USA Andy Ireland reportedly stated that though retirement funds are a great nest egg for the future, they can also be a liability when life emergencies happen.
“Retirement savings are vulnerable to being raided to deal with serious financial hardship resulting from unforeseen life events.”
According to data from NerdWallet, the average American household has over $15K of credit card debt and over $130K in total debt. If broken down per year, each household is paying out nearly $7K in interest alone. To compound the debt problem further, the median household income has shown negligible gains while household debt continues to rise.
When retirees are trapped in this cycle of debt, they are often too busy keeping up with credit card, mortgage, and other varying payments to contribute to retirement funds. For those who are buried in debt, there are ways to effectively dig out as detailed in our previous blog post 6 Ways To Improve Your Relationship To Your Money. Though getting out of debt is no small feat, taking little steps right away can lead to a light at the end of the tunnel.
“Underemployment” and Employment Instability
According to the U.S. Bureau of Labor Statistics, unemployment has fallen to a 5 percent, but the statistics don’t tell the whole story. “Underemployed” individuals (those who can’t find full-time employment) are actually at 10 percent. Since the financial recession in 2008, many Americans are struggling to reach financial stability, often living hand-to-mouth and unable to save.
According to an article on MarketWatch:
“Those who once enjoyed a modicum of financial stability have settled into a new normal of ongoing financial vulnerability, while the struggles of those who were financially insecure before the recession have only deepened.The number of households below the poverty line has barely budged and millions of low- and moderate-income people live paycheck to paycheck.”
GoBankingRates research revealed that 1 in 3 Americans have a startling zero dollars saved up for retirement. In other words, one of the biggest obstacles to a robust retirement fund is the retiree.
Many retirees consider thinking about setting up retirement funds as an obstacle. This thinking is most likely lack of education according the GoBankingRates’ Kristen Bonner. Finding and obtaining that education can be a difficult challenge, especially for Americans who are already facing all the other obstacles we’ve just detailed. The daunting task of navigating the options of retirement can seem impossible; but employing a trustworthy retirement advisor greatly decreases the stress.
When attempting to get better at ensuring you will have a better quality of life in retirement age, obstacles can come in many forms, but the most detrimental is the belief that getting information about your options is impossible. If a retiree can first ask for help from a reliable source, preparation to combat the other obstacles can begin.
Many people spend most of their working years setting aside money in a retirement account. Whether this happens in the form of independent 401(k) contributions, employer benefits, IRAs, pension plans, or a combination of savings strategies, Americans have plenty of options available to build up their retirement fund during their working years. However, a recent GoBankingRates survey reveals that 23% of Americans have less than $10,000 saved for retirement and one-third of Americans report that they have no retirement savings at all. This means more than half of Americans have barely saved anything for retirement. So how confident are today’s retirees about their financial future? Here’s a closer look:
Making the Decision to Retire
One of the first things Americans need to consider as they approach retirement age is when they want to officially retire, or stop working and earning a paycheck. This is where the retiree would live off Social Security benefits, a pension plan, and any personal savings they have accumulated over the years. The full retirement age is 67 for those who were born in 1960 or later but it’s important to note that those who delay retirement until age 70 can qualify for more Social Security benefits. Deciding when to retire to claim Social Security benefits and when to stop earning money is important for financial planning since these decisions will influence how much money the retiree can save and enjoy during retirement.
Building Retirement Savings
Individual retirement accounts (IRAs) and 401(k) accounts are some of the most popular types of retirement plans among working Americans but there are several other options available for those looking to generate a steady stream of income through their retirement years. Getting the maximum 401(k) match from an employer through all working years is a smart way to build up retirement savings. Working for employers that contribute to Simplified Employee Pension (SEP) plans and Salary Reduction Simplified Employee Pension (SARSEP) Plans is another way to increase retirement savings.
Contributing to a Traditional or Roth IRA consistently over several years and decades will provide an attractive return on investment as long as the account holder doesn’t make any early withdrawals. Buying fixed-rate annuities before reaching retirement age or even during retirement can help to secure a guaranteed revenue stream for years to come. While these annuities provide a fixed income stream, it’s important to keep in mind that they will not adjust for inflation over the years. Those who want to take advantage of any signs of growth in the market may fare better with variable annuities. Working with an experienced financial planner can help to determine investment priorities and create an attractive retirement portfolio.
Low Confidence in Retirement
AARP recommends calculating living costs at 70 to 80 percent of preretirement income but many financial planners suggest planning for 100 percent of preretirement income for at least the first 10 years after leaving the workforce. According to the Employee Benefit Research Institute, 24% of workers were not at all confident that they had saved enough money for retirement while 36% were somewhat confident, as of 2014. Whether they’ve lived a long life of struggling financially and never made room for savings or simply had other financial priorities, it’s clear that many retirees cannot expect to live comfortably without a paycheck or other sources of income. Some may end up depending on family members for financial support while others will continue working during retirement to pay for basic expenses.
Individuals approaching retirement age who plan to work and earn through their retirement years may be able to recover any missed savings opportunities from their youth. Prioritizing finances and making an effort to cut costs can also help to reduce living expenses and maximize a retiree’s savings potential. With so many retirees dissatisfied with their retirement nest egg — and many without any retirement savings at all — it’s important for all Americans to make retirement planning a priority at an early age.
At Goldstone Financial Group, we stress a solid plan for your personal retirement, but a recent report may suggest that saving more for your personal retirement is also charitable.
A new study from Merrill Lynch and the Age Wave research firm proposes that Baby Boomers may be the most giving generation by an estimated $8 trillion. Through donations and volunteer work, the next 20 years could see boomers pulling ahead in philanthropy. According to the study, this generation’s life expectancy increase and solid planning for retirement means they are contributing more to their savings, and having more money to give back.
Says Head of Retirement and Personal Wealth Solutions for Bank of America Merrill Lynch, Lorna Sabbia, “Retirees have access to more savings and more time than younger people.”
Merrill Lynch came to the figure by using current charitable giving and figures from Boston College to arrive at the $8 trillion hypothesis. Ken Dychtwald, CEO & Founder of Age Wave, actually thinks the figure is too low if we factor that the $8 trillion is based on today’s dollars.
A 2014 Wall Street Journal article slated 10,000 boomers (aged 51 to 69) to retire every single day. As of 2 years ago, retirees made up 31 percent of the adult U.S. population and give 42 percent of their money to charity and 45 percent volunteer hours. “[…] in 20 years, 60 percent of all charitable giving will be by people over 65,” Dychtwald stated.
As people enter retirement age, they are more thoughtful about how they can make a difference and with more means to do so. People over 65 volunteer twice as much time than the generation before them (people aged 35 to 44), and also beat out their parents’ generation for more thoughtful giving.
None of these figures is a surprise to Giving USA Foundation who think we may be hard-wired to give back. “The big takeaway is that Americans continue to demonstrate that giving to causes they care about is part of our national DNA […}”.
If the study is accurate, boomers are in good shape for retirement. Because of that, they will leave a legacy of wanting to give more, with more money in which to do so in retirement.
People over 40 have the misconception that it’s too late for them to start saving for retirement. While having only 15+ years left to save a nest egg seems daunting, there are some accelerated retirement tactics that can help you earn as much money as quickly as possible.
401(K) to the Max – How powerful is a 401(K)? According to an Investopedia article, a 401(k) can provide you with a more savings that you’d expect.
If you’re 40 years old and donate $17,500 to a 401(k) yearly, with an 8% return (with no employer contribution), you could reap over $1.3 million in savings by age 65. The same person at age 50 can garner nearly $300,000 more with a catch-up amount of $5,500.
If you think you can’t spare fully funding your 401(K) every paycheck, you are doing a disservice to your livelihood come retirement. You get out of it what you put into it.
The Road to Roth IRA – A Roth IRA is similar to a traditional IRA with the potential benefit of being tax-free for qualified distributions. Because of that, Roth IRAs are a great way to increase your retirement savings on a tax-deferred plan. How much can you really sock away with a Roth? Quite a bit!
A 40-year-old who invests $5,500 each year and obtains an annual rate of return of 8% can potentially save over $434,000 by age 65. Even a 50-year old who starts saving $6,500 per year with the same rate of return can save an average of $190,000 by age 65.
Take Advantage of Allowable Deductions – Granted, standard deductions aren’t one size fits all. If you have a large amount of mortgage interest, deductible taxes, business-related expenses that weren’t reimbursed by your company, and/or charitable donations, it probably makes sense to itemize your deductions. However, it’s easy enough to find out through a CPA if this option is right for you. There is no harm in doing your research. Get some help combing over your specific situation to see if it makes sense to itemize. Whether to itemize or not to itemize, make it a habit to keep logs of where, what, how you’re spending. Keep receipts if need be. More than any other retirement advice we can give, know where your money is going so you can save it is a no brainer.
Catch-up using catch-up contributions if you are age 50 or older – If you’re over 50, there is some light at the end of the retirement tunnel, even if you’re late in your retirement planning. At 50, you become eligible to go beyond contribution limits to IRAs and 401(K)s. This is the best news for those desperate to catch-up and haven’t had the opportunity or time to consider their retirement early on.
It should be noted that individuals over 40 who have little to no retirement planning methods in place are at a disadvantage. However, with the proper planning and a willingness to save and invest, the odds are not insurmountable.
If you feel you are not where you want to be in the retirement planning game, don’t lose hope. It’s never too late to set yourself up better for retirement. Find some info, suggestions, and help at Goldstone Financial Group, and be sure to read up on some retirement strategies at Goldstone Financial’s blog HERE.
Those most successful at putting money away—whether through savings, investments, or retirement structures—most likely have at least one thing in common: They give regular attention to the picture of their finances and how they are managing them. Much like your physical health, your financial health is dependent upon taking a proactive, rather than a reactive, approach to its maintenance. For most investors this makes sense in theory, but when it comes to the actual implementation there is a lot of noise, all of which can be misleading if taken out of context, especially if the advice doesn’t necessarily pertain to your personal financial picture.
As we always remind our own investors, all good financial advisors will make sure to learn about your individual situation before providing any advice, so take this information with care. However, the four things we list below are crucial pieces of the financial puzzle, which apply to nearly anyone trying to grow wealth, in any amount.
Pay attention to your consumer-debt ratio: While pretty much a given, even the New York Times will tell you that you always want to be earning more than you are spending—probably because it bears reminding in this consumer-drive society. Your consumer debt ratio is determined by dividing your assets by your liabilities. Now, ideally, this number will be positive, indicating that you own more than you owe. More often than you’d think, however, the reverse is true. According to a study by popular Nerd Wallet, the average household is continually growing and currently at about $130,922. With social security disappearing, this is particularly concerning for the younger generations. More on that below.
Create an Emergency Fund: Like a savings account, this money sits aside in the event that you need access to an unusually large amount of liquidity, in a short period of time. The standard emergency fund amount recommended is the equivalent of three months salary, however, if you are a dual income home, make that the equivalent to 6 months of salary. Emergency funds ensure a certain amount of flexibility should something unexpected—a sudden accident or illness, or the need to take time off from work—befall you or your family.
Max out your retirement accounts: This is important at any age, and especially as you get closer to retirement, but its equally if not more important when you are young. In addition to the fact that social security is only guaranteed until 2035, this allows the younger generation to put money away when they don’t need to use it to care for dependents. It also encourages a habit early on, that will ideally compound over a lifetime. It’s also helpful to actively picture what your retirement looks like, so that you have some idea of the type of lifestyle you are saving toward, and what it will cost to support that. For more tips on saving for retirement read “Making the Most of Life After Work.”
Be respectful of inflation: This is true with regard to the national inflation we experience collectively, but should also be taken into account with the natural inflation that occurs in each of our lives as we age. Many people fail to track their earning and spending trajectories based on their future circumstances and situations, which can wreak unexpected havoc when significant shifts in spending are caused due to big life transitions, like moving or having a baby. Planning well in advance of the natural inflation of your life will also be helpful in protecting your financial health.
Credit Score: Of course, we can’t leave out the credit score. While bemoaned for its haunting qualities in many situations, your credit score can very easily be coaxed to work in your favor as long as you treat it right. And these days, it can dip or rise within a matter of days based on your recent financial activity. Some people simply ignore their credit score, allowing it to work entirely to their detriment by not paying attention, but those who are proactive about their rating can do infinitely more good. Just take a look at U.S. News and World Report’s strategies on quickly raising your credit score.
Studies show that those who are cognizant enough of their finances to be able to easily check in on and understand the above are far more likely to experience financial success because they are, in essence, conditioning themselves for it.
Visit Goldstone Financial for more information on how to ensure your financial health.