Know Your Plan Before You Die…

Most employees do not know what their Social Security benefits will be.  They don’t know what their 401(k) will provide for them at retirement, nor when they will be out of debt.  Few employers provide disability insurance if you get hurt or sick, so what will happen if you become sick or hurt?  And health insurance is a “can of worms.”  If you are self-employed, and/or running a small company, many more questions exist than there are answers.  What will you do when you die or your spouse does?

Everyone should know what benefits they are going to enjoy, and communicate with a spouse about them at least annually.  Things change so fast that if you think you have benefits and don’t, you can go broke in a single week!  It is not hard to gather all your financial information together and review it.  When you have a question, make the effort to call and get answers. 

To see how this works in the real world, I want to share one of my client’s stories:

The husband passed away suddenly at age 64 and his wife had never worked outside the home.  He had $20,000 of group term life insurance and they had $52,000 savings in a 401(k) account.  Their home was worth $230,000, but they still had $189,000 mortgage.  The wife is in good health and expected to live beyond the average life expectancy for women of 87.  The husband’s funeral cost $15,000.  The wife has the option of accessing Social Security benefits of $1,245 a month, or to wait another three years and get $1,570 a month.

What would you do in this situation?  Their monthly living expenses before the husband passed away had been $4,000 per month. Now there’s no money to live like that. Will the wife have to sell the house since the Social Security income she could take now will basically pay the monthly mortgage and that’s it?  If she does sell, where will she live and what will she live on?

This couple had not talked about early death or how one or the other would live once one of them passed away — there was never this kind of detail discussed, ever. They just went along thinking nothing would change.  But it did change and the woman in this situation is in a really bad place financially.  And it will change for you too.  It is only a matter of time before big changes come to your world.  Get prepared.  Review all your benefits and make decisions today as if one of you has passed away.  Play this game over and over until you feel comfortable that you have your financial situation right.

In my experience, most people die with nothing more than a simple will. Their assets have to be probated in court until they are cleared for distribution.  This can take two years.  The expense of having a judge decide how to divide up assets can drain another $30,000 off your assets.  And in many cases, the surviving spouse still needs an income to live on.  What if health problems arise?  

The best way to start preparing for coming changes is to stop spending any more money until you have a Spending Plan in place and have learned how to track that plan so you can see where you are wasting money. Once you do so you will find a surplus that you can begin saving. Fund your future with this real money, that comes from getting your spending and debt under control. Then make sure you create a living trust. Transfer your assets into the trust and make sure nothing goes to the court to decide. Go to and see how simple it is to get organized and match assets with a real plan document.  Don’t delay and become part of the majority that leaves your family out in the cold, unable to help themselves.  The memory of you that will be left will not be good.  To learn more go to or contact me:

Successful Resolutions Come from Thinking Gray, Not Black and White

The idea of dichotomous thinking means that you look at the world as if everything is either black or white.  That kind of thinking can be dangerous, especially to the accomplishment of goals and in the new year, “New Year’s Resolutions.”

To illustrate, I think of a friend of mine who was addicted to alcohol. At one point when he was trying to quit, he did very well not drinking for the first several months, but then fell off the wagon and went on a binge.  I encouraged him to get back on but instead of sitting just on the “edge of the wagon,” so to speak, to sit in the middle of the wagon, staying away from parties or friends that would encourage him to drink.  It helped a lot!  He told me that prior to this new way of thinking that when he made a mistake he would look at it as complete failure (black and white thinking) and would no longer care  what happened to him so he’d just keep drinking.  But changing his approach to more gray allowed him to make mistakes, knowing that all was not lost and that he did have the power to change. Eventually he fell of the wagon less and less often until one day he quit drinking all together.

Here are some clear actions that anyone can take to quit thinking so black and white about your New Year’s Resolutions. They may help you stop being so hard on yourself when you make a mistake and help you avoid the urge to give up all together:

  1. Write down precisely what it is you want to change or accomplish.
  2. List all the things that keep you from that change and avoid them.
  3. List all the support people, things, and mechanisms that will help you achieve your goals and schedule them into your life.
  4. Keep a daily journal of what you have been able to accomplish, reviewing weekly and making corrective action.

And, in addition to these four steps, be sure not to expect 100 percent perfection as a means to measure how well you have done or a motivation (or lack thereof) to continue on with your goals. I have found after years of tracking my goal setting, that I consistently accomplish about 50 percent of my New Year’s resolutions each year. Okay, you may think that doesn’t sound very good but I beg to differ. If over a 20-year-period I can say that I have been able to accomplish at least half or a little more of the goals I have set over the years, that’s a pretty darn good return on my investment. Hey, 50 percent is better than 0 percent and zero is what you get if you can’t at least shoot for half!

In addition to the idea that if you can’t have it all, why bother, here are two additional observations as to why people fail in their attempts. 

First, they don’t really write down on paper what they are trying to accomplish.  They think they “know” better and the goal should be obvious to they don’t write it down. Because of this, they can’t refer back to it and hold themselves accountable. Write it down. This is a great way to track yourself and to see how much you actually do accomplish in one year. Writing my goals down is what has allowed me to go back and figure a percentage of success as noted above.

Second, the other mistake often made when people fail to achieve success with a resolution is they don’t keep a journal, therefore, they don’t meet weekly with themselves to review and take corrective actions.  Everything in this world is changing all the time, including you, so you have to adjust!  You may have to adjust to less money, or a spouse’s lousy attitude, or the death of a loved one, or changes in your health that derailed your New Year’s weight loss goal, or whatever. Keep a journal so you can have documentation as to what changed and make needed adjustments weekly.

If you will take these 4 simple steps, you can have at least a 50 percent chance of success, and as much as 80 percent, rather than the dismal  national average of 8 percent. 

Dream with me:  

  • If you can change even a few things in your life, wouldn’t that make 2017 better? 
  • As you get more accustomed to this 4-step process, you can look forward to next year and the next!

For me, in my coaching work with people who want to change financially, I teach people to set goals with their spending, debt, and savings/retirement. I make them write these goals down in the form of plans, and then I work really hard with my clients to help them track the success of these plans. This constant planning, recording, tracking, and comparing/re-evaluating helps my clients see clearly what they want financially and how to get there realistically, day by day. I help them hold a weekly meeting with themselves or spouse and this helps them be more accountable. Teaching them in this way has changed many people’s lives for the better in a matter of months!

Take the challenge in the New Year to apply these 4 simple steps to anything you want to accomplish. Remember the cautions of being specific, writing the details down and reviewing daily.  Then keep track of it all.  You will find within one month you are half way to your objective.  This I know for a fact because I’ve tracked my own life this way for years, as I have already noted.  

Have a terrific new year and feel free to contact me for further consultation:

Time and Money

Are You Better off Than You Were 8 Years Ago?

Are you better off than you were 8 years ago?

This question has been asked over and over this past election year.  But really, are you better off?  And how much of the results, whether good or bad, are you responsible for?  Don’t lean on government and politics for the answer,  just straight up answer whether you’re better off financially than you were eight years ago due to your own spending, saving, and borrowing habits?

Regardless of what’s going on in the country around us, each of us must take charge of our own lives financially, on a deep, personal level. Who cares what a politician may promise about healthcare, Social Security, retirement, 401(k)s, and finances. As much as politicians might like to think they control our lives, there is only a limited amount they can get their hands on. The rest is up to us. Someone once said, there are only two things you need to worry about, that which you control, and that
which you don’t. I think it’s time to stop worrying so Consider Real Estatemuch about the things we don’t control and focus on the work of saving our own homes and families. Let’s starting looking within for more answers because that’s where they really lie.  

While poor decision-making in Washington does affect how much money we can earn and keep, nobody else cares as much about you as you do, so you are ultimately the one responsible for what happens to your financial life. Even in terrible economic and political times, such as the Great Depression, there were those who quietly applied the never-changing principles of solid financial management — spending control, debt elimination, and saving for the future — and managed to swim out of the mess into opportunities to create enormous wealth later. One of my colleague’s neighbors, at 98, is a good example of this. A humble postal worker for 40 years, who never made more than $30,000 annually, is a millionaire now because of the way he spent, saved, and borrowed during dreadful economic times.

Reflecting back on your last eight years, ask yourself, “what did I take control of to make my life better?

  • Did you study a new subject?
  • Have you become more capable in your work endeavors?
  • Have you finally got your spending under control?
  • Are you in more debt or less debt?

The next eight years are going to come and go with or without us taking decisive action.  We might as well make the time count by choosing to do more than we ever have before.

Here is a time-tested system for accomplishing your dreams. I’d like to apply this system to financial goals…

  1. Write down you goals.  When do you want to retire an with how much money? How much debt do you have and when do you plan to be out of all of it? How much money do you want tomy-goals save for emergencies each month? Those kinds of things…
  2. Devise plans that are attainable for making these goals a reality. Set up a Spending Plan. Set up a Debt Plan. Set up a Retirement Plan.
  3. Keep track of results and evaluate plans. Learn how to track your spending so you can get your finances under control. Actually track your debt pay down so you will know where you are falling short each month.
  4. Adjust plans as needed and start again. Tracking results is the only way you know how you are doing compared to your original plan.  Sometimes through tracking our actions we find the plan isn’t working or that it didn’t really fit with our values and priorities. Adjust things as needed but know that at least with a plan, even if it’s flawed in places, you are going forward. My friend always comments to people who make fun of her for setting such rigid New Years’ resolutions each January: “I have tracked my goal-setting over a 20-year period and I have found something interesting. Consistently, across the board, I find that I accomplish about 50 percent of my goals. I think 50 percent over a 20-year-period aint bad. Fifty percent is better than no percent, don’t you think?” She’s darn right!

In my experience, if you will devise a game plan that is achievable, then track results so as to adjust along the way, you will achieve most anything you set your mind to.

I want to leave this short goal setting discussion with a famous quote by Zig Ziglar, a dynamic motivational speaker.  Whenever he finishes teaching, he always closes with, “See you at the top!”   

How to Avoid the Risk of Running Out of Money During Retirement

Running out of money is one of the biggest worries of retirement. Allianz is a huge financial firm, and they did a survey of a broad spectrum of working Americans in 2015 and found that 77 percent of them feared not having enough money in retirement more than death; that number went to 82 percent for those who were married with dependents.  This is a huge worry!  

Obviously, retirement income is on our minds. With the defined benefit pension plans long gone and Social Security cutting benefits by forcing them to be taxed, plus lowering cost of living adjustments, retirement income looks bleak.

So, let’s discuss why this fear is so big for some:

First, no written financial plan. According to a Princeton survey in 2013, 43 percent of Americans have no financial plan, or a very limited one. Another 38 percent have a basic plan, leaving only 19 percent who have done a comprehensive financial plan. Although you would like to think that the 19 percent are only wealthy people, less than half of them report an income of over $100,000.

Think about why the answers to the following questions matter so much. First, do you know how much you need or want to live on in retirement? Have you taken the time to sit down and make a plan of what you need with a financial professional to give you some advice? Second, do you know how much you need to save each month to get there? Third, is your route to get there predictable, or is the route full of surprises and problems that could stop you from getting there?

Suppose we have a map that looks like this:


If your desire was to get to that star, what two things would you need to know to get there? First, you’d need to know where the star is, exactly. Second, you’d need to know where you are located right now in relation to the star to plan your route.

This is just like financial planning.

  1. You need to take a financial inventory to know where you are, financially. You need to list your assets and your liabilities (debts); this will establish your net worth, which is the total of your assets, minus your liabilities.
  2. You need to talk about how many years you have until you want to retire and decide what percentage of your current income you need at retirement, assuming you have no debt.
  3. You need to see how much you must save each month to get there.

Having a written financial plan like this takes the stress and emotion out of retirement, and allows you to get out there and live better, create surplus, and create a real, comfortable retirement.

Second, bad spending habits. According to the debt statistics listed above, we Americans have bad spending habits. We have a difficult time putting off spending now for something we want, which leads to debt, which then leads to not being able to create a surplus each month to save for retirement, or an emergency.

This is one of my favorite quotes from Zig Ziglar:

“The chief cause of failure and unhappiness is trading what you want most, for what you want right now.”

Overspending is the major reason Americans don’t have a secure retirement. We all make enough money in our lifetimes to retire more than comfortably, but we lack the discipline and the foresight to put off immediate luxuries for future financial security. I’ve had the opportunity to sit down and interview wealthy people, some family, some friends, some professionals, and I’ve asked them every time, “how did you acquire your wealth?” Without exception they all answered, “I spend less than I make.” It’s that simple.

Third, market risk.  The year 2008 spooked a lot of people, and the chances of something like that happening again are fairly high. So many have their funds in speculative investments, and have nobody in the financial world helping them with them. Many of us don’t know what our money is in, understand the fees or costs, track the investments, or havethe-richest-man-in-babylon-review the time to do so. So, inevitably market risk comes, and emotional decisions are made. The Richest Man in Babylon is one of the seminal books on finances for our generation. In it there are Seven Cures for a Lean Purse, meaning, seven ways to become wealthy. The one that is pertinent with regards to market risk is this:

“Guard thy treasure from loss by investing only where thy principal is safe, where it may be reclaimed if desirable and where thou wilt not fail to collect a fair rental. Consult with wise men. Secure the advice of those experienced in the profitable handling of gold. Let their wisdom protect thy treasure from unsafe investments.”

Fourth, not having guaranteed income. Referring back to your grandpa’s retirement, we see that the older generation had guaranteed retirement income, called a pension. That meant he was told before and at retirement how much he could expect on a monthly basis for the rest of his life, and most of the time that included an option for your grandma as well to receive lifetime income.

Since we made the switch to 401(k) plans, we don’t have that guaranteed income. What happens when most people retire is that they end up not spending much because they are scared.

Here’s a common scenario: a person works hard, and accumulates $500,000 in their retirement plan. At age 67, they retire on full Social Security and start drawing on their retirement funds. The first year they pull out $50,000, and live comfortably with their Social Security funds as well. However, doing some quick math, that will only let them go 10 years with that kind of income. That scares them, so they stop spending, and also stop enjoying retirement. This has gotten so common, that this is the way most people retire, scared of the fact that if the accounts they have worked so hard to build up ever take dips, AND they have to draw on those funds for income, it exponentially lowers the amount of time before their money will run out.

For specific help with creating a predictable retirement with income that you cannot outlive, contact me:


Mountain Climbing and Your Money Have a lot In Common

Some people were climbing Mt. Rainer with a guide.  They were all roped together and huge boulders were consistently falling off above them.  Fear was in the heart of all the climbers.  They ascended the mountain successfully and returned to talk about their experience.  The guide was asked how he handled these frightening situations, and his honest response showed his experience.  

The guide said that he has not had any serious mishaps, though he has guided hundreds of people up and down this grand mountain.  He said some of this could be due to good luck but more likely that he has a system for managing problems.  He has learned to treat each climber as if they are trying to kill themselves.  He said for each cliff, each turn or transition on the mountain, that someone would try and fall off the cliff.  Because of this attitude, he prepared so that they were protected, so when mistakes were made and danger was imminent, he was ready for the problem and solved it.  His climbers have thanked him thousands of times for his wisdom to plan ahead and keep them safe.

In my experience, personal money management is every bit like climbing Mt. Rainer.  There are so many pitfalls awaiting each person as we earn, spend and save money.  Examples of such pitfalls are many:

  • Over-spending
  • Inability to communicate with a spouse
  • Living too long
  • Dying too soon
  • Becoming disabled
  • Not knowing how to counter inflation
  • Taxation
  • And much more.  

I see all the time how people are trying to “kill themselves” financially.  Get a financial coach who can help you safely climb to the summit of your financial world:       


More on the Weekly “Money Huddle” with Your Partner

In a recent Money Mastery blog, How to Take and Share Financial Responsibility with Your Partner it was noted that the key to success in taking and sharing responsibility is to hold a weekly meeting, or as we like to call it at Money Mastery, a “Money Huddle.” Both single and married people should take the time to evaluate their finances each week but if you are married it is particularly important that you hold this weekly meeting with your partner.
Marriage adds complexity to finances, so be sure not to skip this important element of personal financial management.
Here are some guidelines for holding the meeting:
  1. Determine the date and time each week for your meeting. To be sure it happens, set a time that works for both people at the same time each week — that way  you and your partner will be planning on it and you will be sure not to miss it. You might want to choose a Sunday afternoon, for example, when both of you are relaxed. Don’t plan to do Clockthis meeting after a long and stressful day at work.
  2. Set a place where you always hold the meeting. This may sound obvious, but we have to remind clients not to hold this meeting in the bedroom, for instance, as this should be a “safe” place where money matters are never discussed. You can hold it at the kitchen table, outside on the patio, or in your family room — just make sure it’s usually held in the same place every time.
  3. Keep the meeting short.  Don’t make this a cumbersome thing that you will both dread and avoid by having it be too long. We recommend you spend at least 15 minutes but no longer than 30. This will give you enough time to review how each of you did and plans for the coming week while still keeping things short and sweet.
  4. Remember to always practice “Instant Forgiveness” in the meeting. This is vital! If your partner has overspent in a particular category or made a mistake in the way they have tracked, or perhaps not even tracked at all that week, let them know it’s okay and that you Screen shot 2016-06-01 at 4.20.39 PMknow they’ll do better next week. Remember, you want an
    understanding spouse when  you mess up, right? It seems like you might be letting each other off the hook too easily with instant forgiveness, but with a Spending Plan in place, there will be more accountability and more desire to handle things properly, so even with a
    mess up, things will get better if you refuse to resort to your old way of doing things, which was to argue over it. We all know, this does no good!
During your weekly “Money Huddle” be sure to review the following:
  • Available income.
  • How each of you have spent money over the week in the spending categories for which you are personally responsible.
  • Problems you encountered with spending in any of the categories.
  • Plans for the coming week.

What Percentage of Your Retirement Savings Do You Think You Can Safely Withdraw?

When you retire, what percentage of your retirement savings (per year) do you think you can safely withdraw without outliving your money?

A) less than 5%

B ) 5 %

C) 6-9%

D) 10-15%

E) 16-24%

F) 25% or more

G) Don’t know

If you’re like most of my clients and I think it’s safe to say, most of the nation today, you probably answered “don’t know.” It’s a tough question, especially if you’re in the pre-retirement years where the emphasis is on accumulating retirement income, not worrying about how much of it you can safely withdraw. The problem, however, is that because most people aren’t giving this important question much consideration, they’re assuming rather naively, that they can withdraw huge percentages each year and still have enough money to live on, despite the fact that they don’t know how long they will live and what 24773043 (b:w)might happen in the world over the 20- to 30-year period in which they will not be working.

How much money can be safely withdrawn does depend to some degree on how much retirement income you will have available at the time you stop working. But in general, the best response to this quiz would have been “A, less than 5%,” the number most recommended by financial professionals.

A New York Life survey of 1,200 consumers has shown that 40 percent believe they can withdraw anywhere from 5 to 15 percent and still not outlive their money.

Surveys like these indicate that there is a growing number of people who are only dealing with half the “retirement equation.” Of course accumulation is important, but knowing how to use what you have accumulated wisely is also crucial. What’s more, it may be hard to get help trying to figure out how not to “outlive your money” when the New York Life survey indicates that many financial advisors don’t know how to help their clients best use their retirement money either. The study shows that 65 percent of advisors polled believe themselves to be very knowledgeable about helping clients create guaranteed retirement income sources, but 4 percent of brokers, agents, and planners polled didn’t know how much could safely be withdrawn and 26 percent of these financial “experts” believe that anywhere from 6 to 10 percent is a safe amount.  Uncertainty about what will happen in the future helps breed fear which often leads to acceptance of a “standard” rule of thumb but even a pat 5 percent rule of thumb withdrawal rate, which is conservative, could be
unrealistic. Because you will have changing cash flow needs over time, you can’t just assume that you can carry that 5 percent withdrawal rate out for the next 30 years — you must plan for variables, and that can be hard to do.

Determining how to use retirement income requires ALL of the following:

  • Determining realistic cash flow needs, not only in the short-term, but 30 years down the road.
  • How much retirement income you will have amassed by the time you quit working.
  • Family history in terms of health and longevity
  • Plans for how you want to spend your retirement years; will you need more money for humanitarian travel, for example, than you would if you just stayed home and played with the grandkids?

Starting with a conservative withdrawal figure of less than 5 percent can be a good way to begin planning for how to use your retirement funds — after all, knowing that it’s probably not realistic to expect 10, Funding15, or 20 percent withdrawals every year can be a good first step in the planning process.

Next, evaluate your estimated needs using forecasting calculators such as the Money Mastery Retirement Worksheet (contact me to get this tool at no cost:  Such tools can help you see how much money you would like to have each year to live on.

You will then want to take a look at your lifestyle and desired retirement goals. What does “retirement” mean to you? Does it just mean that you quit working at age 65, or does it represent something else? Travel, for instance, or part-time work mixed with volunteer service? Decide what it means for you and how much money you will need to make “retirement” as you envision it a possibility.

Additionally, you may want to look into programs that can provide a guaranteed monthly income stream at retirement such as life insurance or fixed annuities. Such programs transfer the management of your retirement funds to an insurance or annuities program, which then pays out a set amount of money per month, for life, transferring the responsibility for withdrawal management from you into a retirement payout program. Again, contact me with questions: (801) 292-1099,

Printing More Money Is Creating a Bubble that Will Burst — Be Prepared for It!

My grandchildren have lots of fun with soap bubbles.  They twirl around among the many bubbles floating all around our yard.  They step on them and try to catch them — it’s really fun to watch.

But another kind of bubble isn’t so fun to play with. It’s the bubble the Federal Bank is creating by printing so much money!  Everyone knows that all bubbles eventually burst.  What results will occur when this financial bubble pops?  No one knows.  We have never been this far into such nonsense in our lifetime.  My folks went through such a bubble burst during the Great Depression and from that experience they have thrifty habits.  But you and I don’t have a clue what will happen to our personal lives, government, economics, businesses, or property ownership.

Many people claim they knew when they next downturn will happen, because they say they can look at history and predict with accuracy.  But it’s faulty to assume to you can accurately predict when all you do is say that there will be an economic crash every year for 20 years and then finally be right.  If a pundit only preaches gloom and doom, they will eventually be right.  Then they show dates and times when they “recently forecasted” this disaster.  What a bunch of cow waste.  But what about when things go up and do well?  Why can’t they demonstrate both directions?  So let’s prepare in advance and hope it never happens.

Here is a short list of how to prepare for an economic melt down: 

  1. Have some silver and gold in a safe deposit box.  
  2. Keep some cash dollars along with the silver and gold.  You decide how much extra money to stockpile but get it done.  
  3. Gather six months of food and water storage.  Use this food occasionally and decide if you like a freezer full of prepared meals, or dehydrated foods, or wheat and rice.  But get this ready to go because if you need this storage, and don’t have it, it will be too late.
  4. Get biodegradable bags to hold waste from your toilet.  Just like ranchers make fertilizer out of cow manure, you can too, if you know how.  But learn how to do this before you need to.
  5. Plan for an electric generator.  It’s easier to store propane gas than regular automobile gasoline.  So get a generator that runs on propane, as well as gasoine.  This will keep your fridge and freezer gong until you can use the food in it or home can it.
  6. Get a water storage container and have at least 500 gallons available, then go to REI or a camping store and purchase water purification products.

This kind of preparation is like a parachute, if you ever need one and you don’t have one, you will never need one again.  Bubbles are fun, but some will burst and leave you with stinging solution in your eyes.  Prepare in advance while you can.