Holiday$$

Sometimes I feel like I’m talking to myself when I get on my soapbox about saving (period, not just for retirement); especially when holidays are approaching. I think it’s fantastic people are seemingly so generous; but because I’m jaded I ask myself if people are feeling this generosity out of a sense of responsibility, or because they really want to give. The core of this cynicism – why wait until an arbitrary date on a calendar? Why not give when the mood strikes you? Could it be the mood only strikes you when the calendar (and mass marketing) says it’s important?

For those who the holidays have more significance, what if you were to buy gifts right after major holidays when stores are trying to clear their shelves; or at least spread the spending throughout the year avoiding the holiday hangover come January? I think we’ve been conditioned to look forward to Black Friday and Cyber Monday; but I would argue deals could be found all year round – especially for items not in season, or going out of season.

Is it a sense of competition driving us to spend so much money? Perhaps we’re worried about what other people will think if they give us something of more value? I can almost hear the rebuttals (having had them in person on more occasions than I can count); about how it’s a season for giving, and people are doing it because it makes them feel good. Perhaps – I won’t pretend to know how others feel. But how would you friends and loved ones feel if instead of buying more “stuff”; you made a contribution in their name to a non-profit they support?

Or better yet, took steps to secure your own financial future by increasing contributions to your retirement account by 2%? I’ve also had it drilled into me this season isn’t about the money; but toys are temporary and most of us are going to get to a point where we are either unwilling, or unable, to work any longer. And when we get there who is going to remember who bought the biggest gift 20 years ago? Especially if those family members are now foregoing their own financial welfare to support you?

Perhaps you think I’m painting too dire of a picture? According to an Economic Policy Institute 2016 report, nearly HALF of American families have NO retirement savings at all! Conversely, an American Research Group 2017 study says the average American family will spend approximately $1,000 this year.

Let’s put this in perspective. The average US median income, according to a 2016 US Census Bureau American Community Survey; is $57,617. It may be higher or lower where you live, but this is the country’s median (average taking into account high and low outliers). Families are spending almost 2% of their income for (1) day; yet cannot save at least as much for the 20 – 30 years when they will not be working.

This doesn’t make any sense to me, especially given how many are probably putting some or all of their purchases on a credit card – contributing to an existing balance they are making payments towards.

I’m not saying don’t give gifts; but I’m imploring everyone to help themselves first. Using the same numbers from above – 2% of the median income ($56,617) – the average household would have approximately $90 per month withheld from their check. No, this isn’t going to be enough to retire one; but it’s a start. The harsh reality is we need to do things that are not fun or sexy to be successful. Sometimes it means we have to be selfish; but it also means you’re not alone in being selfish.

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Celebrate The Wins

All too often I think we, as a population, tend to focus on what’s not working and the negatives in our lives. And who can blame us, seemingly being bombarded non-stop from news outlets, Twitter & other social media and all the other external stimuli we’re exposed to.

This can make it difficult to remember life isn’t all bad; in fact, in my opinion the good far outweighs everything else – if we just take the time to look for it. Contrary to what some may believe, positive occurrences don’t need to come in momentous packages. Children often show us this through the wonder they exhibit as they explore their world – what happens to this as we age? Where does it go?

There is no doubt life can be uncomfortable and, at times, downright miserable. But why should we allow that to become our reality? Even when things are going horribly wrong, I believe you can find something good to focus on to help start lifting you up – even if it’s only someone allowing you to pull in front of them on the freeway or having your child (or spouse) do something you ask them w/o an argument.

Focusing on these little “victories” will train your brain to look for others; shifting your focus from noticing just the bad to really understanding how much good you are exposed to on a daily basis. To me, this is doubly important as a parent of a child with Special Needs. I have found it scarily easy to lose sight of life’s simple pleasures – falling into a pit of darkness where nothing seems to go right at times.

This isn’t healthy, and it’s certainly not enjoyable. Yes, there are times when my son loses ground – times when he’s unable to utilize skills I thought he’d mastered. And yes, crap like flat tires on days when I need to be somewhere or the universe seeming to pick dump on Eric days happen to me. But dwelling on this only serves to make me feel like crap for longer, and causes me to look at everything through the wrong lens – focusing on the negatives of every situation.

I’m no Pollyanna, I understand the world is not all rainbows and unicorns. I’ve had my dreams shattered and felt like the universe laughed in my face. I’m choosing not to make this my focal point. I have found life to be much more enjoyable if/when I celebrate my successes, no matter how small they may seem.

Like any habit, it may be difficult at first – especially if it’s not something you’ve been doing. You may need to actively look for things to celebrate, but I promise if you stick with this it becomes much easier. In a few months you won’t even have to think about it – it will have become the norm. It’s simple, but it’s not easy. I had to tune out much of the external stimuli to give myself enough bandwidth to start doing this. I still tend to walk away from those who focus only on the negative, I don’t begrudge them their beliefs but I don’t want it in my life.

The year’s almost over – wouldn’t it be fantastic to live 2018 and beyond looking at the world through a lens where you can readily acknowledge and celebrate ALL your wins? Give it a try, and remember you get out what you put in – so if you are halfhearted in your attempt don’t expect amazing results.

What’s Holding You Back?

I’ve lost track of the resource fairs and other events I’ve attended, sponsored or both over the years; yet without fail I have witnessed the same reactions as people walk by booths manned by Financial Advisors (not just me). There is a quick look, then look away while muttering “I’m good” or “I have a plan”.

Yet studies have shown the majority of Americans are not prepared financially, with the majority unable to cover a $400 sudden bill because they don’t have an emergency fund. This bothers me, a lot; because I was in those same shoes the year my wife died. I don’t know if I would’ve reacted any differently than those I see at the Resource Fairs, because I didn’t know about them until after everything occurred and I was faced with becoming a civilian, and a single dad of a child with a disability.

There has to be something keeping people from making the connection – and I don’t know if it’s fear of being sold to; shame or fear of being shamed; belief they need money to talk to an advisor (in some cases this is true); etc. What I do know is without help it’s unreasonable to think anyone can change their current circumstances, especially if they feel like they’re swimming in oatmeal with a 50 lb weight strapped to their waist (how I felt on/off for the first year after my wife passed – and truthfully still feel at times).

Planning (financial or otherwise) is not the same for families with significant disabilities. It’s not because your situation is worse than anyone else’s; it’s because you have different challenges than most and unless someone is familiar with those challenges the advice you receive (although well-intentioned) can set you back.

Maybe that’s what’s holding people back – they’ve been burned and don’t want to get screwed over again. Unfortunately I don’t have a guaranteed solution for how to avoid this – my best advice is find people who have overcome similar challenges and ask them how they did it (understanding it may not work for you).

However I can say this with absolute assurance – if you continue on the path you are on, and you are not seeing the results you want, nothing is going to change on its own. At some point you will need to make an adjustment, and the sooner the better; because the correction is less painful the shorter in duration or scope you can get it. So I challenge all of you, rather than simply saying “I’m fine” take a deep, hard look at where you are and ask yourself if you’re comfortable because everything is as it should be; or you’re comfortable because this has been the status quo and it’s so much easier to just go along with the flow.

Be Accountable

If you’re being 100% honest with yourself, when was the last time you made an excuse for not doing something? In my opinion we’re all guilty of it, although the frequency varies. It’s something I’ve personally been focusing heavily on since losing my wife – that was the wake-up call I needed. Not that I was quick to avoid ownership when I messed up, but I could certainly have done a better job acknowledging my role.

It’s tough, admitting our fallibility – and it’s very uncomfortable (to me at least). There is a flip side, there are those who seem to take a perverse pleasure taking ownership of everything – almost martyr-like. This isn’t what I’m advocating, I just want more of us to acknowledge the influence we exert (consciously and unconsciously).

It seems like “it’s not my fault” or “it wasn’t me” has become almost a reflex – something I think most of us learned as children. When called on it we may even dig our heels in, becoming more defensive – so unwilling to lose face (if we’re at fault). With this in mind, what can be done?

I think there are (2) things all of us can do. First, knowing people’s propensity to go on the defensive, approach others understanding they likely didn’t do whatever it was maliciously. Try to understand where they were or what they were thinking. This doesn’t mean letting them get away with it, they need to be held accountable; but use an approach where they are more likely to be open and receptive (not an approach I was very successful with while on Active Duty).

The other thing is we need to be receptive to feedback. We’re not perfect, we’re going to make mistakes. We may be lazy, and need a push from time to time – understand we all have flaws and things to improve upon. If you don’t feel the feedback is relevant, after considering it, then don’t act on it. This is more constructive than arguing or being defiant. Stand up for yourself, but stick to the facts. Reacting emotionally will often escalate the situation, and seldom helps your cause (speaking from personal experience).

Like anything else this takes time and self-awareness. I believe you’ll be happier for it, and can incorporate this into all aspects of your life – from spending habits to being a partner in an intimate relationship.

Improve Your $ Habits

I want to acknowledge James Clear, it’s his image I chose as cover art – and you can learn more about his ideas at his website¬†https://jamesclear.com/three-steps-habit-change.

I’ve been thinking a lot about habits lately, as I’ve committed to improving my communication skills through the remainder of 2017. I understand this won’t happen on its own – I need to actively work on changing my behaviors while finding ways to reward myself until I don’t have to think about what I’m doing any longer.

Another impetus for this topic is client-driven, over the last several months I’ve met with clients who have poor financial habits; and from what I’ve seen this is more common than not. Individuals and families do the best they can, but often they haven’t been given the tools to develop good habits; or they’ve identified things they want to change and try to change too much – becoming overwhelmed and giving up.

In my opinion the “easiest” habit to create is one that requires little extra thought or action on your part. For saving money, I ask people to find $25 – $50/mth, and set it aside somewhere they won’t spend it – that could be in an envelope in your underwear drawer or an online bank account w/o an ATM card; it’s more important not to touch it than where you put it.

Need motivation, tie the money to something else you’re trying to do. For example, if you’re trying to lose weight pay yourself $5 or $10 every time you decline dessert. The money will reward you for following your diet, so you’ll become more likely to stick to it. And saving the money towards something you really want will reward you for your discipline. Win Win.

You can use these same tools with your children, to help them develop healthy saving habits young. I understand some may disagree with rewards, because then you may only be doing something because of what you get – and I want to acknowledge that argument. However, my belief is if I can get someone to work up to saving $400/mth, even if they are using $100 each month to reward themselves they’ve still set aside $300 more than they were before.

This is one idea, and certainly not the Holy Grail of personal finance. There are many resources available – blogs like Paula Pant’s “Afford Anything“; “Mr. Money Mustache”,¬†and J. Money’s “Budgets are Sexy” to name just a few; and just as many or more podcasts.

The key is not trying to change everything. Start with one thing, focus on it until it becomes second nature and then move on to the next. Having an accountability partner (and I know I’ve said this before) can be a HUGE help. Celebrate your successes, and don’t beat yourself up too hard when there are bumps in the road – it happens. What I believe you will find as time goes on is you will notice the bumps less; because your success has achieved a life of its own.

 

Take the Long View

I’ve found it can be incredibly difficult to plan for the long term, with all the noise and distractions vying for your attention in the short term. Something always seems to come up, tempting you by its immediacy. It’s because of this I think it’s critical we have a deep understanding about the what, when and why of our long term goals.

A common example I’ve been helping people with is where they want to live when their child is older. Understandably they don’t want to move while the child is in school, because of the possible disruption it could create. However, if they are considering a move to another State they could be hurting themselves by waiting; because most, if not all, States have transitioning youth funds set aside for young adults leaving High School at 21. Waiver programs are designed to give students automatic head of the line privileges; but this will not apply to someone who moves into the State after High School – they will have to wait.

The “noise” is people with good intentions encouraging the parents to stay, reinforcing the parents’ belief it’s what’s best for the child. And it very well may be, but it should be weighed against the need for continuing services after High School. There is also fear of the unknown – how will my child react, what will the school be like, etc. It’s a lot to handle, especially if you have other children and/or are a single parent – you don’t have to do it alone; there are organizations and professionals who can help.

I’m using one example, focusing on a family who has a child with Special Needs making a move; but taking the long view is just as relevant when considering whether to buy or rent (a house), when to take social security, when to retire, etc. Take some time to yourself, away from distractions, and think about what you want and where you see yourself in 20 – 30 years. Then back into it, how are you going to get there?

Write it down – it’s not meant to be set in stone, but having a written record will help you when those crises occur and you need to make an immediate decision. In the heat of the moment it’s unreasonable to expect yourself to be able to think about the future; but you should absolutely be able to look at what you had written and use it to help ground you. You may not change your mind about what needs to be done, but you’re no longer operating purely on emotion. Practice with routine decisions, so you build the habit and muscle memory kicks in when the poop hits the fan. I’m here if you need/want help.

Living Independently

As I continue to work on enrolling my son in Social Security, and completing the necessary paperwork with the VA and DFAS (military pay system), I can’t help but wonder what he’s going to do when I’m gone – and will this all be enough. Obviously we can’t plan for every eventuality, so we do our best to address as much as possible.

When we’ve finished applying for his benefits, my next focus will be on where he will live. There are many organizations throughout the country offering Residential facilities, and with Group Homes no longer authorized it’s a safe bet these homes will not have more than (4) residents; but we’ve (my son and I) decided not to pursue this route – because he doesn’t want to have a roommate.

There are also organizations creating communities of individuals with a specific diagnosis, I believe the most common is Autism. Although I think this is an incredible opportunity for some families, for me personally it does not meet the full inclusion experience I want for my son.

So what does this leave? For us, we’re looking at purchasing a multi-family home (duplex). While I’m alive, and able, I will work with a property management company to rent out the other unit (I don’t like doing maintenance). When I’m gone, either I will have paid off the mortgage or the life insurance will settle the debt; either way ownership of the property will transfer to my son’s Special Needs Trust, and the Trustee will work with the property management company.

In my opinion, the advantage to this is the property will pay for itself after I’m gone. The Trustee will have the authority to increase rent, evict tenants, etc; and the property management company will ensure the property is well maintained. Living in the house prior to me passing will allow us to develop an understanding of what the household expenses are; which will allow me to flesh out a reasonable budget for the Trustee to follow.

If you have a child, or sibling, you’re caring for and you haven’t put any thought into where they will live after you’re gone please use this as a siren call to start planning. There is no one-size fits all solution, it really boils down to what the individual wants/is capable of and your financial situation. The longer you wait, the more difficult it will become – but it’s only too late if you pass away before you do something; because then it falls into the hands of the State. If you’re not sure what to do, reach out and ask.