For the last several years Liz and I have slowly but surely consolidated our various accounts. You know the ones I mean. The 401K investments from this job, the Roth IRAs set up through that job. And as the years went on?and our jobs changed (mostly mine)?the paperwork started piling up and we had a heckuva time keeping track of how much money we had (or didn?t have), where it was invested, if it was actually making a decent return, and what?if anything?we should do about it.
One thing becaFor the last several years Liz and I have slowly but surely consolidated our various accounts. You know the ones I mean. The 401K investments from this job, the Roth IRAs set up through that job. And as the years went on?and our jobs changed (mostly mine)?the paperwork started piling up and we had a heckuva time keeping track of how much money we had (or didn?t have), where it was invested, if it was actually making a decent return, and what?if anything?we should do about it.
One thing became to clear to us: we needed some help. We?re reasonably intelligent people, but we?re not financial experts by any stretch of the imagination. Don?t get me wrong, it?s not like we?re recycling bottles for the spare change. We had individually?and then collectively after we got married?managed to squirrel away the beginnings of a respectable retirement fund, not to mention that we don’t have any credit card debt.
None.
Zero.
Nada.
At the end of every month we pay off the entire credit card bill. It wasn?t always that way, mind you?at least not for me. During my 20s when I was first in NYC and barely scraping out a living, I got myself in pretty deep to VISA?about $9,000?but along the way I was fortunate enough to land enough freelance work to pay it all off. That was about seven years ago. I haven’t had credit card debt since.
[b]Are Financial Advisors Hooey?[/b]
And yet Liz and I still had no big, overarching plan. We did consolidate a bunch of our loose accounts under Charles Schwab, and finally got that money making some money. But while [i]consolidate[/i] always sounded like such a fancy, important word, it just means that we had fewer [i]accounts[/i], but not necessarily more [i]money[/i]. Were we really doing well? We didn?t know, as [i]well [/i]is subjective, but after months?even years?of feeling like we needed a plan, at least we felt better knowing that we were moving forward and had a decent nest egg given our age, when we added it all together.
Thing is, now that we?re getting a little older?stop right there, I did not say [i]old[/i], I said [i]older[/i]?and have more financial responsibility than in the past, we agreed that it was time to sit down more formally with a financial advisor and see if we were on the right track. We had a general plan that we thought was pretty decent, but did we have the right plan for us?
I want to clarify that I have always been wary of financial advisors, because my thinking has been that, if they are so good at managing money, then why are they humping out a living at it rather than making tons of their own? I don?t know if that was the right attitude, but I?m generally skeptical about someone being considered an [i]expert[/i] about anything.
But as my good fortune would have it, about five years ago I met a financial planner who ran the professional networking group I joined back in my consulting days, and over the years I came to like and trust him as a person. His name is Andrew McCann, and I consider him a man of integrity. To me, that?s important.
But, hey. Maybe I?m just weird that way.
[b]The Million-Dollar Question[/b]
So Liz and I finally agreed to sit down with Andrew, and we?ve since been in the process of realizing just how much our pretty decent long-term plan wasn?t half as decent as we thought. It wasn?t a bad plan?hey, at least we had one?but it hasn?t been, as we?ve found out, garnering the kind of returns we could?ve been making had we had a better plan. And we were [i]nowhere close[/i] to being on track for the amount of money we will ultimately need when retirement age comes oh-so-many moons from now.
What Andrew said to us was this: at the rate you?re going, this how much money you?re going to need when you hit 65 if you want to live at the lifestyle level you have now. This is how much you?re on track for.
Those numbers were [i]faaaaaaaar [/i]apart. Like, by a few million. That right. [i]Millions[/i]. Not a type-o.
Gulp. (sweat, sweat … bite finger nails).
[i]Buuuut[/i]…. Andrew said, we can fix all that. And here?s how.
And so he went through a bunch of options for us that we can actually afford today, setting us up for tomorrow. What I like about this approach is that Andrew doesn?t have a cookie-cutter system and signs you up for it because he’s got a deal with some specific program. He customizes your plan for [i]you[/i] as it serves [i]your [/i] needs, and the more money he makes for you, the more money he makes for him. So it’s in his best interest to get you invested in the best plans he can find. No two plans are alike.
And this is what made Liz and I feel especially comfortable, because many?although not all?financial planners don?t do this. Many spoon-feed you the plan [i]they[/i] want. Even so, their plans might be good plans, even very good plans. Liz and I are just more comfortable with a customized plan, advised by someone we trust [i]personally and professionally[/i].
As such, we have signed and submitted all of our papers, making monthly and annual contributions to this fund and that, and now our money is finally starting to make more money for us than it did before–and at this pace, we’ll have the millions we’ll need. Again. Not a type-o. [i]Millions.[/i]
Is the plan we?re going with [i]the [/i]best plan there is? No idea. But after comparing it to what we had?and more aggressive plans that just make us too nervous, with too much risk for us to feel comfortable?this new plan makes sense for us. (He also set us up with life insurance)
[b]Feeling Good[/b]
Liz and I are not financial geniuses, and we?re not dunces either. But what we?ve taken away from this experience is a greater sense of ownership and confidence in our future, because now we have a formal, official plan with a structure that we can understand and revise whenever we want. We?re not just hoping things work out. We’ll revisit the plan with Andrew every year, and make any adjustments that seem appropriate. We?re invested in the outcome of our financial lives. There are no guarantees, of course, but we feel better than ever about the future.
There are plenty of people out there further ahead of the financial game than Liz and I, and certainly plenty of people more sophisticated about it than we are. But I do feel like we?ve learned something important here, and while I?m in no position to say what anyone else should do about their financial future?because what the heck do I know about it??if you don?t have a plan right now, it might be worth looking into.
It?s amazing what?s out there. Sometimes it?s just a matter of finding the right place to start.
p.s. I hope nobody feels like I?m hawking Andrew, here. He just happens to be someone I trust?and can vouch for on a personal level. I?ve included his information below in case anyone is interested in speaking with him. Andrew offers free consultations.
Andrew McCann
Life / Disability / Long-Term Care Insurance
Employee Benefits / 401-K / SEP
College & Retirement Solutions
http://www.nmfn.com/andrewmccann
646-366-6689
andrew.mccann@nmfn.com
Post edited by: rcolchamiro, at: 2007/10/05 22:04
Post edited by: rcolchamiro, at: 2007/10/07 09:56
Post edited by: rcolchamiro, at: 2007/10/11 18:55
Post edited by: rcolchamiro, at: 2007/11/04 18:01
Post edited by: rcolchamiro, at: 2007/11/07 07:07
