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IKE TROTTER — The nuts and bolts of sound planning



Sound economic planning today is about developing a framework to the issues affecting our basic financial needs. And normally, different issues will surface at different stages in our lives. After all, who can argue that a married person 35 years of age with small children will face financial issues fundamentally different than one who is 60 to 70 years of age.

The one issue, however, that permeates the issue of  “nuts and bolts” planning picture for all age groups concerns the need for good financial organization. It is sad, unfortunately, but far too many procrastinate with building a financial strategy due to the complexity of the subject matter itself. It can be sobering for sure. But what is fundamental is nailing down basic issues that apply to one’s own financial life. A key facet, therefore, to sound planning — one that serves as the “glue” to long term success — is about good financial organization.

In my 40 years of working with families in Mississippi, without question, the biggest obstacle to a successful financial strategy lies with poor record keeping and organization. Even today, with so many sources for help literally at our fingertips, many float adrift in a sea of financial disarray. What usually follows from this can be stress, anger, and ultimately, inaction -which is the worst result that can occur.

What then can we do? Where do we start changing bad habits? In order to create a solid plan for ourselves and our loved ones, we must make financial organization a priority. This goal should be one we commit for each day, each month and each year. Here’s a basic three point strategy that may help. As usual, these ideas are not original, but when put into practice provide an excellent time-tested blueprint for results.

No. 1: First and foremost, determine where you are financially.

I’ve discussed this in previous articles on budgeting but it is of such importance it bears repeating. You can’t move forward financially unless you know where you are starting. As is relates to economic planning, ask yourself a few key questions:

» Are your assets sufficiently liquid to handle emergencies?

» Are your debts getting out of line?

» How are your assets performing? Do they line up with your goals?

» Is your money keeping pace with inflation?

No. 2: Have a clear picture of where your financial future is headed. This is critical in the planning process.

» Put your goal(s) in writing

» Categorize goals according to priorities. A good example to this would be drawing up a will. This is usually a good and recommended first step.

» Establish a deadline for completion of your goal. Everyone needs a little push to get action started.

No. 3: Determine the specific steps necessary to reach your goal

What’s the real message here?  Your plan must be started with a specific end in mind as to how much and how long the goal will take.

It has been said the hardest part to a race is getting a good first step. Perhaps these kinds of basic ideas will offer a better blueprint for success as to your financial plans with year 2016 being right around the corner.

Opinions presented are general information only and not intended as specific advice or recommendation for any individual situation or product. As individual situations vary, seek personalized advice from qualified professionals regarding all tax, legal and personal financial matters.

» Ike S. Trotter, CLU, ChFC is a credentialed Financial Advisor in Greenville. Email him at  iketrotter@tecinfo.net 


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About Ike Trotter