Planning for Financial Success & Happiness How to Become Financially Secure at Every Stage of Your Life

You’ve hopefully thought at least a little about saving for retirement. And you’ve maybe even thrown a little money into savings for a rainy day. But do you have an overall financial plan for yourself and your family?

A financial plan helps you pinpoint your financial goals—both short-term and long-term—so you can budget and save to meet those goals. From taking a much-needed vacation this summer to being able to comfortably retire down the road, a financial plan can help you get there.

Featured Expert
Andy Smith, CFP® Senior Vice President of Financial Planning, Financial Engines; Co-Host, Financial Engines’ Investing Sense
This guide was written by MoneyGeek Staff

Retirement & Senior Living

It’s never too early or too late to start planning and saving for retirement, but the sooner you get started, the better off you’ll be. Whether you’re investment-savvy or a finance newbie, there are different paths you can take to financial stability in the later stages of your life. Find out why you need a retirement plan now—no matter how old you are—and how to live comfortably during your retirement years.

Taxes

No one likes doing their taxes. But depending on your circumstances, doing your taxes the right way may lead to money in your pocket—not the IRS’s. Many groups, such as veterans or students, may be eligible for tax benefits or have access to free tax preparation advice. Learn how to file your taxes correctly and where to go if you need help.

Budgeting

Whether you’re looking to cut back on your credit card debt, buy your own home, or put away enough for retirement, getting on a budget can help you get there. Of course, life can sometimes get in the way of those goals. A car accident or unexpected layoff can drain your bank account; poor-paying gigs and trouble finding a new job can undermine your confidence.

That’s why a well-planned budget will not only help you meet future financial goals, it will also enable you to build up your savings so you’re prepared for the unexpected.

Life Events

Big life events like having a baby, making a move, or getting a divorce can throw a wrench in your financial plans. But a little planning—and some tweaks to your budget—can help you avoid being short on cash as your circumstances change.

Travel

Your dream vacation doesn’t have to break the bank. Some smart planning and a few cost-trimming tricks can help you travel the world without busting your budget. Find out where to find the best travel deals when planning your next trip.

Financial Planning 101: An Expert’s Take

Andy Smith Expert

Andy Smith,CFP, is the co-host of “Investing Sense,” a show that helps listeners better understand today’s financial and retirement landscape. He’s also the Senior Vice President of Financial Planning at Financial Engines and the former Executive Vice President of The Mutual Fund Store.

Who needs financial planning?

Anyone who wants to be able to get to and through retirement successfully. For that matter, anyone who wants to increase their chances of successfully reaching any of their short- or long-term financial goals (building emergency savings, debt service, buying a home, college education, optimizing Social Security strategies, building an investment portfolio, creating estate plan for heirs, etc.).

When should you start financial planning?

Yesterday – but since you may have missed that particular deadline, let’s get going on it today! Since there are many possible entrance points into the process, now really is a great time to get going.

Early in your career? Start planning now to create an emergency savings account, to plan your paydown of any (probable) student loan debt, and to build your 401k investments.

Middle of your career? Get help with college planning for your children, optimizing your 401k allocation, building an estate plan, and creating a plan to pay off your mortgage earlier than expected.

Late in your career? You better have a solid idea about what your retirement glidepath needs to be so that you get a running start on life after work. Work with an advisor to optimize your specific Social Security strategy and to plan how you’re going to pay for what could be hundreds of thousands of dollars in healthcare costs throughout retirement.

Already retired? Get more help making sure your investment plans, financial affairs, and estate issues are in order for your family after you’re gone.

Where should you get financial planning advice?

Wherever you are, be certain that you’re working with a fiduciary – someone legally-obligated to put you and your best interests first at every point throughout your client/advisor relationship.

If you work with an expert, what does financial planning typically include?

If you’re working with the right expert, it should always focus on you and your goals for your finances … not whatever the person is trying to sell you, that day. You should have multiple discussions about what you’re trying and wanting to accomplish.

Your discussions should include:

  • Issues faced during accumulation, pre-retirement, and retirement phases

  • Budget planning

  • Employer-sponsored retirement plan optimization

  • Life insurance

  • Education and college planning

  • Estate planning

  • Tax optimization

  • Health care

  • Long-term care

  • Social Security optimization

  • Retirement distribution

How much does financial planning cost?

You’re always going to get what you pay for. “Free” may not cost anything now, but it’ll be really expensive for you to fix later. Just because something costs a lot doesn’t mean that it’s valuable to or for you.

Since you’re always making sure to work with a fiduciary, you’re going to be on more solid footing from the beginning because you know that their financial interests are aligned with yours.

It’s usually better for you to work with fee-based advisor/planner to further align your interests. Financial planning charges could be via fees, commissions, or a combination of both.

What questions should you ask your financial planner?

Are you a fiduciary? You want to hear “Yes”; if you hear anything but “Yes…”, run away!

How are you paid? It’s optimal for you to hear that they’re paid on a fee basis. Make sure you clearly understand the compensation structure – ask now—before you’re a client and before it’s even more difficult to have this conversation.

What is your process? You want to hear about services provided and the processes followed. If you only hear about products they want to sell you … run away!

Updated: July 28, 2017