Planning 101

We believe setting goals without creating plans to accomplish them is similar to wishful thinking. Wishful thinking may make you feel good however it produces no fruitful outcome. For real results you need to create a plan, which is really a series of steps to perform. Creating a plan to reach your goals isn’t as daunting as you might think. To assist you we’ve listed an approach to creating a plan below:

1) Document your goals in writing. The process of collecting your thoughts and documenting them allows you to clarify your goals. The more specific your goals are the easier it is to create steps to achieve them.

2) After reviewing your goals, think about the steps can you take today, tomorrow, in the future, to make them a reality. Write down these steps and assign a date to them that you would like to see the step accomplished.

3) Review your documented goals and steps every morning and every evening. This reminds you of the importance of your goals and keeps them fresh in your mind. If you think of additional steps during your review write them down and assign them a date as well.

4) Perform the steps. Completing the steps you have written down is your plan to achieving your goals. Ask yourself, “What can I do today that will take me a step closer to my achieving goal?”

5) Share your goals and steps with others. Sharing your goals allows you to internalize them. It also allows people to help you achieve your goals as well as support and encourage you along the way.

6) Don’t give up! Your goals will not be achieved in one day. Goals are achieved by completing steps over a period of time. By completing each step along your plan you become closer and closer to achieving your goals.

Prepaid Tuition

A prepaid tuition plan, or Section 529 plan, is an excellent vehicle for college savings. These plans are guaranteed to increase in value at the same rate as college tuition. Therefore parents can lock in tuition prices at today's rate with no risk to their principal. Many plans are guaranteed by the full faith and credit of the state. However these plans may require the account owner or the beneficiary be a state resident when the account is opened.

Anybody, not just parents, can contribute to a prepaid tuition plan. Prepaid tuition plans can be an excellent estate planning tool. Prepaid tuition plans are exempt from federal income tax, and may be exempt from state and local income taxes. In addition, some states offer a full or partial tax deduction for contributions to the state's plan.

Plans have annual enrollment deadlines to lock in the current year’s rates so interested individuals should be sure to remember the deadline as part of their planning process.

Manage Risk with Disability Insurance

Most individuals purchase insurance products to protect their home, health, car, and their life. However an often overlooked item is protecting your income. If you’re like most folks , you can’t afford to become disabled.

We believe disability insurance is an important part of financial planning and risk planning. Per the Social Security Administration "nearly 3 out of 10 workers entering the workforce today will become disabled before retiring". Creating a solid financial plan includes managing risk associated with health, home, vehicles, protection of your assets and protection of your income.

If disability insurance is not currently part of your plan we recommend you contact an insurance provider right away.

Estate Planning Protects You and Your Assets

Estate Planning can protect your hard earned assets. Your assets include your investments, retirement savings, insurance policies, and real estate or business interests. To begin planning you should ask yourself three questions:

1.) Who do you want to inherit your assets? The answer to this question belongs in your will.

2.) Who do you want handling your financial affairs if you're ever incapacitated? The answer to this question belongs in your power of attorney form.

3.) And, who do you want making medical decisions for you if you become unable to make them for yourself? The answer to this questions belongs in your health care or living care proxy.

Based upon your answers to these questions you can begin building these important parts of your Estate Plan. Do you really want someone else answering these questions for you?

Beneficiary Review

Every time you update your Will you should also conduct a Beneficiary Review of your assets. A recent study found that "80% of beneficiary forms on individual retirement accounts, defined benefit pension plans and insurance policies are either blank, outdated or not properly filled in".

A Beneficiary Review is simply a check on the beneficiary form for each of your assets to ensure mistakes were not made when designating beneficiaries. Many times these forms are filled out quickly when the account is new and they are never looked at again. Mistakes or blank forms can be very costly because they impair your ability to protect, preserve and pass on assets to your heirs.

Now is a perfect time to conduct a Beneficiary Review by contacting the respective financial institutions and/or visiting your Human Resources department.

Complete a Will

Everyone should complete a will to ensure that their wishes are carried out in case of illness or death. A will can ensure that your wishes are heard and that your heirs receive the proper inheritance without unnecessary delays. A will also enables you to name a guardian for your minor children and allows you to direct where your savings, investments, home, valuables and other assets will go once you die.

A Gallup Poll in 2005 found that seven in 10 (71%) respondents aged 50 and older have a will, compared with 37% of people under 50. With so many Web sites devoted to easy, do-it-yourself wills there is no excuse for not recording your final wishes in writing.

To assist our readers I am reviewing several sites and I will report our findings in a new post. If you have suggestions for our review please leave a comment.

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