Three Questions


Over the past thirty years I’ve had an opportunity to work with hundreds of couples regarding their personal finances. While most of these couples were not financial experts they were wise enough to know they needed professional advice. Research suggests that only a small percentage of people seek professional help regarding mapping out an effective retirement plan. Not so coincidentally the vast majority of folks, about ninety-five percent, arrive at retirement wholly unprepared and often face thirty years or more of financial stress. 
Why is it that people are so reluctant to get the help they need? My observations suggest that in many cases they simply don’t know that they need help. When working with couples, I typically find that one person is ‘in-charge’ of the finances while the other person happily remains in the dark assuming that the in-charge person has everything under control. Only when it’s too late do they discover the truth. Here are three questions you can ask your in-charge spouse to determine if any reliable financial game plan is in place:
  1. “Do we have an up-to-date financial statement?” If the answer is, “No”, you have your first red flag. The financial statement is the most basic tool for building a solid financial game plan and simply includes a list of all of your assets, liabilities and sources of income. It should be updated at least annually so that you can track your financial progress towards your goals. If the answer is, “Yes”, ask your spouse to take a few minutes to review it with you. If you’re not a ‘numbers person’, don’t worry. It’s pretty easy to follow the basics: If what you owe is more than your total assets, that’s a very bad sign! You need help. If your assets are greater than your debts but by a small margin and you’re in your late forties or older, you should get help.
  2. “What are we saving as a percent of our gross income?” If the answer is, “I don’t know”, it’s a good sign you need help. Here’s a little hint: If you’re in your twenties, you should be saving a minimum of 10% of your gross income. That number rises to 15% in your thirties if you haven’t already accumulated at least one times your annual income in investments. If you’re in your forties and the total of your investments is less than two to three times your annual income, you’ll need to save 20% of your annual income.
  3. What’s our ‘number’? No, I’m not speaking of your cell phone number; this is your target capital account for retirement. How much money do you need to accumulate between now and retirement in order to create the retirement of your dreams? If you don’t know this number, you’re like Alice in Wonderland…any path will take you there!
If you don’t get positive answers to these three questions, don’t wait. Seek the help of a Certified Financial Planner™. CFPs are trained to help you develop a customized financial game plan. You can find one near you by going to Many will work with you on an hourly basis.