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.

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Financial Mastery 101: Getting Your House in Order

  1. 1. Stone Financial Retirement Planning Financial Mastery 101 By: Ken L. Stone
  2. 2. How Much Will You Make? <ul><li>Based a 6% annual Salary Increase </li></ul>
  3. 3. Gosh I ’ ve Got It Made, Right? <ul><li>If you earn 60,000 a year in just twenty years you will have earned $2,207,100. </li></ul><ul><li>You ’ ll have plenty of money, RIGHT! </li></ul>
  4. 4. Road Blocks to Financial Success <ul><li>7 Road Blocks </li></ul><ul><ul><ul><li>No Goals </li></ul></ul></ul><ul><ul><ul><li>Ignorance </li></ul></ul></ul><ul><ul><ul><li>Debt </li></ul></ul></ul><ul><ul><ul><li>Poor Investments </li></ul></ul></ul><ul><ul><ul><li>Inflation </li></ul></ul></ul><ul><ul><ul><li>Taxes </li></ul></ul></ul><ul><ul><ul><li>Procrastination </li></ul></ul></ul>
  5. 5. Road Blocks To Financial Success <ul><li>No Goals </li></ul><ul><li>The most common obstacle to financial success is not having any goals. </li></ul><ul><li>With no goals you have no direction and no way of knowing if you ’ re on track. </li></ul><ul><li>If you want a car, house, or to protect your family you MUST set goals. </li></ul>
  6. 6. Road Blocks to Financial Success <ul><li>Ignorance </li></ul><ul><li>Many people of all educational levels lack basic understanding of how the financial world works and how to make their money work for them. </li></ul><ul><li>Rule of 72 … If you place your money in an investment earning 9%, how long would it take to double your money? </li></ul><ul><li>72 divided by 9 equals 8 </li></ul>
  7. 7. Road Blocks to Financial Success <ul><li>Debt </li></ul><ul><li>Credit Card kred ’ -et kard .: </li></ul><ul><li>1. A means for buying something you don ’ t need, at a price you can ’ t afford, with money you don ’ t have. </li></ul><ul><li>Outstanding Balance $2,000 </li></ul><ul><li>Interest rate: 18% </li></ul><ul><li>Minimum Payment 2.8% </li></ul><ul><li>Interest cost over the loan Period $1,906 </li></ul><ul><li>Payoff Period: Over 11 Years </li></ul>
  8. 8. Road Blocks to Financial Success <ul><li>Poor Investments work in reverse. They consume money and wealth. </li></ul><ul><li>Beware of investments that promise everything. If it sounds too good to be true, it probably is. </li></ul>
  9. 9. Road Blocks to Financial Success <ul><li>Inflation </li></ul><ul><li>If your money is not working for you, then it is losing ground due to inflation. </li></ul>
  10. 10. Road Blocks to Financial Success <ul><li>Taxes … The number of days you have to work just to pay your taxes. </li></ul>
  11. 11. Road Blocks to Financial Success <ul><li>Procrastination </li></ul><ul><li>Some people never get around to planning for the future. </li></ul><ul><li>“ Procrastination is my sin: </li></ul><ul><li>It brings me constant sorrow. </li></ul><ul><li>I really shouldn ’ t practice it; </li></ul><ul><li>Perhaps I ’ ll stop tomorrow. ” </li></ul>
  12. 12. Comprehensive Wealth Management Six Keys to Financial Success
  13. 13. #1 Risk Management <ul><li>Protecting your assets and your earning power is easy to overlook when planning for the future </li></ul>
  14. 14. Risk Management <ul><li>Health Care </li></ul><ul><li>Medicare </li></ul><ul><li>Long-Term Care </li></ul><ul><li>Disability Insurance </li></ul><ul><li>Homeowners Insurance </li></ul><ul><li>Automobile Insurance </li></ul><ul><li>Liability Insurance </li></ul><ul><li>Life Insurance </li></ul>
  15. 15. #2 Cash Management <ul><li>Cash Management involves optimizing your cash flow, building a liquidity fund, effectively positioning your available cash, and building your net worth. </li></ul>
  16. 16. Cash Management <ul><li>Asses your current situation. </li></ul><ul><li>Month to Month Cash Management </li></ul><ul><li>Liquidity Fund </li></ul><ul><li>Traditional Savings </li></ul><ul><li>Tax-deferred Savings Alternatives </li></ul><ul><li>Tax-Advantage Savings Alternatives </li></ul><ul><li>Refinance your Mortgage? </li></ul><ul><li>Credit cards </li></ul><ul><li>Four Ways to Increase your Savings </li></ul><ul><ul><li>Set goals </li></ul></ul><ul><ul><li>Pay yourself first </li></ul></ul><ul><ul><li>Arrange to have your savings deposited automatically </li></ul></ul><ul><ul><li>Start saving now for retirement </li></ul></ul>
  17. 17. #3 Investment Planning <ul><li>A major portion of your financial picture involves your personal investment plan. </li></ul><ul><li>Unfortunately, without a coordinated strategy, it ’ s difficult to build an effective investment portfolio that meets your financial needs. </li></ul>
  18. 18. Investment Planning <ul><li>Determine your Investment Profile </li></ul><ul><li>Evaluate the Risk </li></ul><ul><li>Diversification </li></ul><ul><li>Investment Options </li></ul><ul><li>Stock Market </li></ul><ul><li>Bonds </li></ul><ul><li>Mutual Funds </li></ul>
  19. 19. #4 Tax Planning <ul><li>What is your Marginal Income Bracket? </li></ul><ul><li>Reduced Benefit from Itemized Deductions. </li></ul><ul><li>Taxing Children ’ s Income </li></ul><ul><li>Winning With Tax Exempt Investments </li></ul><ul><li>Tax Deferred Investing </li></ul><ul><li>Tax Advantaged Investing </li></ul><ul><li>Tax Planning Opportunities </li></ul>
  20. 20. #5 Retirement Planning <ul><li>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. </li></ul>
  21. 21. Retirement Planning <ul><li>Retirement Income </li></ul><ul><li>Where does it come from? </li></ul><ul><li>Cost of Retirement </li></ul><ul><li>Cost of Procrastination </li></ul><ul><li>Sources of Retirement Income </li></ul><ul><li>Types of retirement Plans </li></ul><ul><li>Personal Savings & Investments </li></ul><ul><li>IRA Rollover </li></ul><ul><li>Distribution Methods </li></ul>
  22. 22. #6 Estate Planning <ul><li>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. </li></ul>
  23. 23. Estate Planning <ul><li>Find an Attorney </li></ul><ul><li>Tax Reduction Tools </li></ul><ul><li>Estate Distribution Techniques </li></ul><ul><li>Establish a Trust if needed </li></ul><ul><li>Types of Trusts </li></ul>
  24. 24. <ul><li>Thank you for attending! </li></ul><ul><li>Please fill out the evaluation! </li></ul>Questions?
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