Make a Plan That Works for You!
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Money Talks, LLC  
Susan Hammitt, AFC, CDFA 
  Email:  - Telephone: 503-233-8142
Money Talks, LLC Newsletter                                                      April 2010
In This Issue
Building Block Three:
Lifetime Income Planner 

Adaptability, Education, Job Training, and Lifestyle: Lessons from Twenty-Somethings 
Talk About Money:
Elderly Parents
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Susan Hammitt, AFC, CDFA 
Financial Counselor
Divorce Financial Analyst
Talk About Money:
Elder Parents 

As difficult as it may be it is very important to initiate money conversations with elderly parents.


Offering to help secure a free credit report to verify accuracy and protect against identity theft is a great ice breaker.


At some point most elder parents find it reassuring to know someone they trust will be able to pay their bills if they are temporarily unable.


Find ways of providing support without taking control. If there is resistance encourage parents to let you know if they change their mind. 


If there are significant concerns and your parents want professional assistance,

Call me:
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Personal Financial Sustainability

The third building block in Personal Financial Sustainability is the Lifetime Income Planner. Too often financial decisions and planning are based on flawed income assumptions.  Anticipating life changes helps provide a more meaningful foundation in financial planning.


Lifetime Income Planner 
 Income Assumptions - Life Planning Method 

Too often financial plans use faulty income assumptions. Assuming that household income is fixed or increasing throughout work-life can lead to wreckage in financial plans. There are many reasons that income may fluctuate over time, some planned and some surprises.  

Use the Lifetime Income Planner, to see how valuable it is to develop income assumptions based on your unique life plan. While doing the exercise, keep it simple. (1) Consider your unique values and priorities. What life events do you forecast in your future?  (2) How much household income do you project during each stage of your life?  (3) What do you need to budget for a sustainable Valuable Daily Life? 

The last column of the worksheet provides a calculation of after tax residual income for savings and investments. Or, if it's a negative number, it indicates shortage for which you may want to prepare and plan.

Resist temptations to read more into this exercise than intended. Use only todays dollars.  And, don't jump ahead to investing and wealth building.  Instead, focus on a sustainable Valuable Daily Life that can be maintained even through times of change. 


Click here for real life examples of this method:


Adaptability, Education, Job Training, and Lifestyle

Lessons from Twenty-Somethings  


People of all ages are enrolling in trade schools, certificate programs, community colleges, and universities. Discussions about education for education sake seem to have quieted in the current economy.   Concerns about how debt will be repaid or savings will be replenished lead to greater emphasis on education as job training. 

In many cases forty to sixty year olds are returning to school, job training for midlife careers.  My 57 year old sister, Karen, is a great example. She had a long career in time-share marketing.  When the industry flattened she identified a new career path in the medical industry. She successfully completed the necessary classes and certificate programs for employment as unit clerk in a hospital setting.  She got the job!  And, she continues to take classes planning to improve her income potential.  The added value; she experienced so much success in her studies that she is now planning to complete a degree program. She is hooked on learning. Like millions of boomers she plans to work until she is 70. 

I believe Karen was influenced by her two twenty-something daughters and their successes in school, planning for medical careers. The twenty-somethings have certainly caught my attention as a financial counselor.  Whether they have completed college or been out in the workforce they are a resourceful group.  And, I believe they understand personal finance in ways that will serve them well. I have talked with fifteen remarkable twenty-somethings recently and they offer interesting perspectives in personal finance.  Here is what I glean from this small sampling: 

         Securing a job requires targeted and specific skills.  Trade schools and certificate programs offer that type of job preparedness, even for college graduates. Lifetime learning is connected to lifetime income.


      Keeping obligations (debt) to a minimum provides flexibility for trying different types of jobs and personal mobility for broader life experience. 


      Shared housing, or living at home with family, is just fine.  They don't seem to be hung up on securing personal identity through independence.


      It's not necessary to select a lifetime career. Adaptability and change will be part of any career path. Jobs are not forever.


      They will not be replicating their parent's lifestyles.


      Marriage and family may be high on their long-term list of goals; there is no sense of urgency. They didn't seem pressured to set specific timelines.


      Their lifestyles do not accommodate the accumulation of a lot of material goods.  However, communication technology is essential in support of their Valuable Daily Lives.

It occurs to me that these twenty-somethings may have a clear, less obstructed view of how to operate in the emerging economy.


Make a Plan That Works For You!