financial mastery 101: getting your house in order
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Ken Stone (Stone Financial Retirement Planning) gave this presentation at the Mar 2010 program meeting hosted by BDPA Cincinnati chapter.TRANSCRIPT
Stone Financial Retirement Planning
Financial Mastery 101By:
Ken L. Stone
How Much Will You Make?How Much Will You Make?
Based a 6% annual Salary Increase
$0$2,000,000
$4,000,000
$6,000,000
$8,000,000
10Years
20Years
30Years
Your Life Time Earnings
$30,000 peryear
$60,000 peryear
$90,000 peryear
Gosh IGosh I’’ve Got It Made, Right?ve Got It Made, Right?
If you earn 60,000 a year in just twenty years you will have earned $2,207,100.
You’ll have plenty of money, RIGHT!
Road Blocks to Financial SuccessRoad Blocks to Financial Success
7 Road BlocksNo Goals
Ignorance
Debt
Poor Investments
Inflation
Taxes
Procrastination
Road Blocks To Financial SuccessRoad Blocks To Financial Success
No Goals
The most common obstacle to financial success is not having any goals.
With no goals you have no direction and no way of knowing if you’re on track.
If you want a car, house, or to protect your family you MUST set goals.
Road Blocks to Financial SuccessRoad Blocks to Financial Success
Ignorance
Many people of all educational levels lack basic understanding of how the financial world works and how to make their money work for them.
Rule of 72… If you place your money in an investment earning 9%, how long would it take to double your money?
72 divided by 9 equals 8
Road Blocks to Financial SuccessRoad Blocks to Financial Success
DebtCredit Card \ kred’-et kard\n.:
1. A means for buying something you don’t need, at a price you can’t afford, with money you don’t have.
Outstanding Balance $2,000
Interest rate: 18%
Minimum Payment 2.8%
Interest cost over the loan Period $1,906
Payoff Period: Over 11 Years
Road Blocks to Financial SuccessRoad Blocks to Financial Success
Poor Investments work in reverse. They consume money and wealth.
Beware of investments that promise everything. If it sounds too good to be true, it probably is.
Road Blocks to Financial SuccessRoad Blocks to Financial Success
Inflation
If your money is not working for you, then it is losing ground due to inflation.
Road Blocks to Financial SuccessRoad Blocks to Financial Success
Taxes…The number of days you have to work just to pay your taxes.
Road Blocks to Financial SuccessRoad Blocks to Financial Success
Procrastination
Some people never get around to planning for the future.
“Procrastination is my sin:
It brings me constant sorrow.
I really shouldn’t practice it;
Perhaps I’ll stop tomorrow.”
Comprehensive Wealth Comprehensive Wealth ManagementManagement
Six Keys to Financial Success
#1 Risk Management#1 Risk Management
Protecting your assets and your earning power is easy to overlook when planning for the future
Risk ManagementRisk Management
Health Care
Medicare
Long-Term Care
Disability Insurance
Homeowners Insurance
Automobile Insurance
Liability Insurance
Life Insurance
#2 Cash Management#2 Cash Management
Cash Management involves optimizing your cash flow, building a liquidity fund, effectively positioning your available cash, and building your net worth.
Cash ManagementCash Management
Asses your current situation.Month to Month Cash ManagementLiquidity FundTraditional SavingsTax-deferred Savings AlternativesTax-Advantage Savings AlternativesRefinance your Mortgage?Credit cardsFour Ways to Increase your Savings
Set goalsPay yourself firstArrange to have your savings deposited automaticallyStart saving now for retirement
#3 Investment Planning#3 Investment Planning
A major portion of your financial picture involves your personal investment plan.
Unfortunately, without a coordinated strategy, it’s difficult to build an effective investment portfolio that meets your financial needs.
Investment PlanningInvestment Planning
Determine your Investment Profile
Evaluate the Risk
Diversification
Investment Options
Stock Market
Bonds
Mutual Funds
#4 Tax Planning#4 Tax Planning
What is your Marginal Income Bracket?Reduced Benefit from Itemized Deductions.Taxing Children’s IncomeWinning With Tax Exempt InvestmentsTax Deferred InvestingTax Advantaged InvestingTax Planning Opportunities
#5 Retirement Planning#5 Retirement Planning
An Effective retirement plan identifies your retirement goals, show you how to take advantage of all your funding sources, and accounts for the effects of taxes and inflation.
Retirement PlanningRetirement Planning
Retirement IncomeWhere does it come from?Cost of RetirementCost of ProcrastinationSources of Retirement IncomeTypes of retirement PlansPersonal Savings & InvestmentsIRA Rollover Distribution Methods
#6 Estate Planning#6 Estate Planning
With Federal Taxes running 50-75 %, estate planning is more important than ever. A proper plan can help manage your affairs and reduce taxes paid by your heirs.
Estate PlanningEstate Planning
Find an Attorney
Tax Reduction Tools
Estate Distribution Techniques
Establish a Trust if needed
Types of Trusts
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