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Getting money is like digging with a needle; spending it is like water soaking into sand. - Japanese Proverb
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The Two Stages of Financial Life
Most of us have two main stages of financial life.
The first stage is our Working Life: we save and consume. Stage two is Retirement: we just consume. Many are better at the consuming part than the saving part, and that creates a dilemma.
Saving is critical to our financial success. As Professor Burton Malkiel says in his new book The Elements of Investing, "Saving empowers you to keep priorities."
Financial planning is essentially about thrift...saving. Anyway you slice it, there are trade-offs between living for today and saving for the future. Without saving, you can't accomplish long term financial goals-regardless of your income. We see some clients that actually "dis-save"-they spend more than they make year after year. This is a slow but steady path to financial ruin.
In general, most people in their 70s or older have saved and lived within their means. The same can't be said for many people in their 40s, 50s, or even 60s.
I recall speaking at a University of South Carolina Economic Outlook Conference a decade or so ago on the topic of retirement planning. This was around the time of the seminal (but largely erroneous) study that projected a multi-trillion dollar intergenerational wealth transfer to baby boomers. I questioned both the methodology and conclusions. Unfortunately for many boomers, this is their retirement strategy...a view which supplants the need to save.
A very dangerous strategy indeed.
- James E. Wilson, CFP® My Blog
 No retirement "calculator" is a valid substitute for the dynamic, goal-driven approach employed by J.E. Wilson Advisors. But this one is a reasonably good resource to quickly capture a snapshot of where you are as you approach the second stage of your financial life. |
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WealthRx® is J.E. Wilson's unique wealth management process, designed with successful physicians in mind. Learn more. Contact 
