Planning For Retirement … the ultimate level of unemployment – Part 1

Long ago and far away, in a time and place where cars sported lots of chrome and fins, the head of household (we’ll call him Joe) got out of bed each morning and went to work at The Big Company, Inc.

Joe started working at The Big Company right out of school and it was understood that he would work there for his entire career.  When he retired, The Big Company’s pension plan would send Joe and his wife a pension check each month that would allow them to enjoy their golden years with some degree of comfort.  The Big Company accepted the responsibility for investing the right amount of money each year to ensure that Joe’s retirement (along with the retirement of all of Joe’s fellow workers) would be safe and secure.  Joe could count on that pension check arriving like clockwork each month and he could never outlive that income.  That’s just the way things worked “back then”.

Today, Joe’s grandson (affectionately called Joe3 by family members faces a much different employment future.  The Big Company (TBC) no longer offers its employees a pension plan.  Instead, TBC invites its employees to contribute money into a Qualified Retirement Plan.

This Qualified Retirement Plan allows TBC to deduct money out of Joe3’s paycheck each week.  Joe3 decides how much will be taken from the check and how that money will be invested.  While TBC makes sure that there are many options for Joe3 to choose from, Joe3 is responsible for selecting his investments and monitoring them from month to month and year to year to make certain that he sufficient money to fund his own retirement.  If he plans well and the investments perform well, Joe3’s retirement should be safe and secure.  If he fails to put enough money into the plan; or, if the investments don’t perform as well as he had hoped and he has too little to retire on … oh well, that’s Joe3’s problem and TBC has no responsibility or culpability for the shortfall.

Since it’s Joe3’s responsibility to make sure he has enough money when he retires, we’re going to take a look at the different plans that Joe3 can choose from; the opportunities that those plans offer and the limitations that are included in those plans.  In Part 2, we’ll look at one of the most prevalent Qualified Retirement Plans … IRA’s

What Your Family Needs to Know When You Die (Part 5)

In the days and weeks following your death, your family will be looking for information about any benefits to which you and they are entitled.  You can make this search easier for them by providing the following information for them.

  • Group Insurance Benefits – if your employer provides group life insurance, let your family know the name of the insurance company and who the primary contact person is at work.  This will probably be someone in the Human Resources (HR) Department who will be able to help your survivors file the necessary paperwork to collect the benefits provided by the group policy.
  • Individual Life Insurance Benefits – there once was a time when employees remained at the same employer for their entire working lifetime and that employer’s group benefits could be counted on to help the employee meet all of his or her needs.  That is no longer the case.  While I would never tell a person to refuse the insurance that the employer is paying for, I would also encourage that person to have life insurance that he/she owns and controls; life insurance that will stay with him/her when they are no longer a part of the group.  Once again, make sure your family knows the name of the insurance company that you have purchased life insurance from, the name of the agent from whom you bought it, and the address/telephone number of the company’s home office.  Keep the policy in a safe place (i.e., a fireproof lockbox) at home.  Many people believe that the policy(ies) should be kept in the safe deposit box at the bank; but, if the bank learns of the death before your beneficiaries get the policy out of the box, that box can be sealed until it has been “inventoried” for estate tax purposes
  • Any associations to which you belong that may provide benefits – many associations and professional organizations offer benefits to survivors as a benefit of membership.  Make certain to list out all organizations to which you belong and any benefits that your know they provide along with contact information for each one so that your survivors can easily claim those benefits.
  • Homeowner’s/Renter’s Insurance and Auto Insurance – the name, address, and contact information for your agent along with the name of the insurance company and its home office address and telephone number should be listed along with the information regarding individual and group life insurance policies

The days and weeks after your death will be a difficult time for your survivors.  You have the ability to make this time a little less trying for them by planning ahead and making certain that they know where the plan details can be found and who to contact for help in putting that plan into action.  There are few love letters that you can write to your family that will be more appreciated than the one that begins, “I know this is hard for you, but I’ve done all I can to make it a little easier for you …”


It’s that time of year again.  The ball has fallen.  The decorations have been taken down.  The confetti has been swept up.  It’s time to face the reality of a new year  with the clean slate upon which each of us will write the story of what we do in the next 365 days.

I like watching old movies and there is a scene in a movie where the captain of a ship instructs his navigator to “plot a course thataway“.  Can you imagine the thoughts that must have gone through that poor navigator’s mind?  “Thataway?  Whichaway?”

The navigator in our minds needs to know where we want to go and what we must do to get there.  He/She needs goals.  So, in order to give your mental navigator the guidance needed, let’s take a few minutes to focus on goal setting and what helps us set goals that take us where we want to go.  What are the characteristics of goals that truly take us to the destinations we want to reach?  Goals should be …

  • Written down and made public – a quick search of the internet will yield a multitude of websites designed to help us set goals.  Some tell us to write them down on a piece of paper.  Others instruct us to record them in a page on-line.  Still others will suggest that we post them on one or more of our social media pages.  Whichever method we choose, the important thing is that we have them written down someplace so that we can see them regularly.  Making them public doesn’t necessarily mean that they must be posted to social media; but, it is important that others know about them and will hold us accountable for them.
  • Believable – for a goal to truly motivate us, we have to believe that we can achieve it.  W. Clement Stone wrote that, “Whatever the mind of man can conceive and believe, it can achieve”.  To believe, we must be able to visualize ourselves reaching the goal and feeling the satisfaction that will come with the achievement.

I once knew an agency manager named Ray who measured his own success by the number of individuals that he recruited, trained, developed, and promoted into leadership positions in the company he worked for.  One day, he asked a young man what his ultimate career goal was.  “To become an agency manager and replace you” was the young man’s answer.  While some would have thought that to be an arrogant and presumptuous answer from someone just entering into a career, Ray grinned and invited the young man to come into his office and sit in his chair.  Then, Ray took the young man’s picture while he was sitting in that chair, handed it to him, and told him to put that picture on the bathroom mirror where he would see it every morning while he was shaving.  “That will remind you, everyday, why you are getting up and working hard”, Ray told him.  He made it possible for that young man to literally see himself reaching the goal that he had set for himself.

  • Specific – Goals that are vague (“thataway”) aren’t really goals.  They are vague suggestions that provide no ultimate end point.  One person says, “This year, I’m going to lose weight”.  Another person says, This year, I’m going to lose 25 pounds”. Who do you think will be more likely to attain the goal?  Specific goals require that specific actions be taken.  “To lose 25 pounds, I’m going to stop taking “seconds” at dinner; skip desserts; and, walk for 30 minutes every evening”.
  • Measurable – For a goal to truly motivate us, we have to be able to see how we’re progressing toward it and to know when we’ve reached it.  Let’s assume that the goal is to create an emergency fund that has 2 months of actual living expenses in it.  Since we know that our basic living expenses are $2,000 each month, we know that we need $4,000 in the fund.  Each month, we deposit $167 into the account and, when we get our bank statement, we can see the balance increasing by not only the deposits we make but by the addition of interest as well.  Viewing the increasing balance each month allows us to measure our progress toward reaching the goal.
  • Challenging – Our goals need to be big enough to make us stretch.  Doing just enough to get by may keep our heads above water, but it won’t help us grow.  The sales person who knows that by doing the same thing every year he can reach his/her quota won’t grow and advance.  But, the sales person who challenges himself/herself to increase sales by an amount that requires a bit more effort is the person who rises to the top of the organization; both in terms of professional responsibilities and financially.
  • Inspirational – As the great motivational speaker Jim Rohn once suggested, setting the goal of earning enough to pay our bills may be a goal, but it seldom inspires anyone.  Goals that inspire us to “go the extra mile” lead us to greatness.
  • Have deadlines – Ray, the agency manager referred to above, told everyone that “goals are simply dreams with deadlines”.

“Someday” is not a deadline.  “Someday” is a dream … an illusion … a mirage that may appear to be leading us somewhere we want to go; but, is really leading us to nowhere.  When the young man above told Ray that his goal was to be an agency manager and replace Ray, he was told to set a deadline … when was this going to happen?

The young man set a date … exactly five years from the date on which he was hired.  Did he replace his mentor?  No.  But, exactly three years after the date on which he was hired, he was appointed as the agency manager for an agency that was struggling.  He’d reached his goal of agency management; and, somewhere, I believe that there is a picture of him sitting in a chair just like Ray’s.

If the story of this new year in your life is to have a happy and satisfactory ending, the course you plot will be guided by the goals you have set.  If you have not already done so, today would be a good day to begin writing down your goals.  Some should be long-term goals (where you ultimately want to end up) and some should be short-term goals.  There will be professional (career) goals and there will be personal goals.  Some of the goals will be big goals and some will be small goals.

Short-term goals may be things that you want to accomplish within the next week; the next month; the next year.  Short-term goals may be way stations on the road toward your long-term goals.

Professional goals empower us to grow within our chosen vocations.  Personal goals enable us to become better spouses … better parents … better people.

Big goals could be long-term goals but are not required to be long-term.  Small goals are little things that help us feel we are making progress.  Don’t underestimate the importance of these small goals.  There is something incredibly satisfying and motivating about being able to go down our list of goals making check marks as we say “got it … got it … got it”.  The more often we are able to say “got it”, the more motivated and inspired we become to continue working toward the attainment of the goals still unchecked.

One year from today, each of us will look back at what we have accomplished.  Will we like what we see; or, will we look back with regret for what might have been?  Only you can determine what you will see.

Make 2012 your best year yet!