Creating Freedom – in honor of the 4th of July

In honor of our 4th of July holiday, I searched for the word freedom and then discovered a new word. Ataraxic and, playfully, I decided it is a “condition” that I want to “suffer” from. What does it mean? One simple definition is “freedom from worry”.  Can you imagine?

Worry, is something nobody likes to do and most people want to avoid. We know that worrying is a waste of time & energy. We also know that it does not get it us anywhere, kind of like expecting to move forward when we rock in a rocking chair.

Ok, so maybe, we try not to worry, but at best, we are at least sometimes pre-occupied with thoughts that concern us. We think about our financial situation, our health, our families, friends, and of our longevity.

In case you are wondering how this might fit with my goal of providing “financial wellness” please read on and let me explain.

Living longer gives us more of an opportunity to enjoy life. It also creates more of a financial risk. Will our money last as long as we do?

Regardless of our age, thinking about this is important. Planning and preparing is imperative. In fact, those that are younger, have the greatest opportunity to plan and prepare. Those that are a bit older are more limited, and yet would still benefit from reviewing the following:

Benchmark how much money you need when you “retire”:

  • How much do you need to live each year?
  • Generally, it is not safe to assume you will just spend less; i.e. health care costs can increase as we age and you may travel more

How are you going to pay for it?

  • Social Security?
  • Pension or Retirement Funds?
  • Savings or Investments?
  • Working Part-Time?

How many years does your money need to last?

  • The Social Security website has a calculator that you can use to estimate your longevity

Note that woman, in particular, might want to save more money than their typical male counterparts. Why?

  •  Statistics show, that woman, on average, are paid less than a man
  • Women might leave the job market to have children and thus can earn less, over their lifetime
  •  Earning less could result in a lower Social Security benefit

Let’s suppose that you decide that you want to continue working part-time until you reach your “Full Retirement Age” or even post-pone retirement until the maximum age of 70 when you must start drawing upon your Social Security Benefit. Doing this can pay big dividends, in the form of increased monthly payments.

There is one big caveat to this plan and this, too, we can try and plan for. Generally, we must have our health to build wealth.

One of the greatest assets we have is the ability to produce an income. It has been said that our health is the new wealth. The ability to produce an income is part of our wealth.

We were all born with free will. As Americans, we have the liberty to pursuit our happiness and our freedom of choice. Planning today and saving for tomorrow creates more freedom of choice, in the long-term.

John Wayne said, “ Tomorrow hopes that we learned something from yesterday”.

I like to say, “Hope is not a good financial strategy. Plan, act, achieve and may you always have a reason to smile”.

Deb Fox is working to make a difference in peoples lives, hearts, and wallets. Although she earned her CPA in 1997, she is not currently practicing as a CPA. She does use her knowledge to help others protect their financial health and is available for side-by-side, remote, or mobile appointments.

 

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