This document outlines four steps to achieving financial security: 1) control your expenses by spending less than you earn, 2) increase your income through career advancement, 3) reduce debt and build savings, and 4) control risks through proper insurance. It then provides additional guidance on applying these steps at different life stages from your 20s through retirement. The overall message is that consistently following a plan of spending control, income growth, debt reduction, and risk management can lead one to the goal of financial security.

1. Americans have learned a lot of hard financial lessons
in recent years, as bubbles have developed and burst in
the stock, credit, real estate, and employment markets.
For some people, the so-called “new” financial reality
has reminded us that the steps to financial security that
served the Depression-era generation well may still
apply to us today.
What have people learned? You can’t count on stocks
or real estate to always rise in value. Mortgage and
credit card debt can sometimes be dangerous. If
you have a job, you should prepare for the possibility
that one day you may not be able to find work for
an extended period.
STEP 1: CONTROL YOUR EXPENSES
One of the more effective ways to become financially
secure is to consistently spend less than you make
secure, and that is to consistently spend less than you
make. No matter how large or small an income you
produce, if you spend more than you make, you may
never become financially secure. Instead, you may
constantly find yourself under an increasing load of debt,
hoping for some future windfall that may never occur.
Whatever you are spending, chances are you can spend
less and still be happy. There are families that live
comfortably on $20,000 per year, and there are families
that cannot afford to live on $200,000 per year. If you
are spending more than you earn, you could easily find
someone who would look at your spending and consider
a lot of it wasteful. The key is to look at your spending
through the eyes of that person and see where to cut
back.
One great way to bring your spending under control is
to keep track of each expenditure you make on a piece
of paper or in a computer spreadsheet. This causes you
to think about what you are doing as you are spending,
and it gives you the opportunity to look back at your
spending from time to time to see if your spending is
productive or wasteful. Another way is to take money out
of every paycheck before you spend money on anything
else, put that money in an account that you never touch,
and figure out how to live on what remains.
Also, if you have a credit card balance that you cannot
immediately repay in full, may be time to get rid of
your credit cards. You may want to make it a priority to
pay for everything in cash and have some money left
over every month to pay down your existing credit card
balance.
STEP 2: GET ON A PATH TO INCREASE
YOUR INCOME
There are lots of schemes to get rich quick, but deep
down inside, we all know that they do not work. So
what can work? Find a career that you enjoy, work
diligently, and continually seek advancement.
In 2004, the U.S. Senate unanimously passed a
resolution declaring April to be National Financial
Literacy Month, with its goals being to teach
Americans how to establish and maintain healthy
financial habits. This article outlines four healthy
financial habits that have stood the test of time
and that collectively can lead to financial security.
Here are four beneficial financial principles with which
your grandparents would agree, and collectively they
can be clear path to financial security.
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This material has been prepared for informational and educational purposes only.
This information is not intended to give legal or tax advice.
Financial
Information
Ahead Four Steps to Help You Stay on the Road to Financial Security
April is Financial Literacy Month:

2. If you like working in a field, stick with it, but
continuously seek advancement. Learn the skills you
need, form the relationships you need to form, and take
the chances you need to take. By doing so, you are
more likely to eventually reach financial security.
STEP 3: REDUCE YOUR DEBT
AND BUILD SAVINGS
Make eliminating your debt and building your
savings a central goal of your monetary life. For
example, if you have debt other than a mortgage,
you may want to set a goal for yourself to have it all
paid off within a year. If you make that a priority,
chances are you can do it. If you have a mortgage, try
setting a goal to have it paid off within ten years. Once
you are totally debt free, set a goal to add a particular
dollar amount to your savings every year.
Whatever the goal is, if you make it a high enough
priority, you are very likely to achieve it. And, after you
meet your first financial goal, you will have instilled in
yourself a very good habit, so it will get easier to set and
achieve the next goal.
In any case, if you work for an employer with a 401(k)
plan and a company match, consider putting enough
in the plan to get the entire match. That is free money
from your employer – a strong incentive to save – and
retirement is sooner than you think.
STEP 4: CONTROL YOUR RISKS
How many times have you heard a story about a family
that did not have insurance? What a tragedy that is! You
can follow all the right steps to success, yet one health
crisis or automobile accident can put you right back at
square one.
Thus, true financial security can benefit from the
proper the proper use of insurance. Health insurance,
for example, will protect your finances in the event of
an expensive catastrophic illness. Make sure you have
adequate disability, homeowners, and automobile
insurance. Maintaining a higher deductible can help you
keep your insurance premiums more affordable. When
you get married and each time you have a child, you may
want to consider increasing your life insurance. Consider
buying personal umbrella liability insurance to protect
yourself from lawsuits.
When you are nearing or in retirement, you may face
new risks, such as the risk of outliving your retirement
savings or the risk of needing costly assisted living care.
Long-term care insurance and annuities can help you to
control those risks.
Not all insurance comes from a commercial insurance
company. For example, you may consider self insuring
the risk of unemployment. Consider making it a priority
to build an emergency savings fund equal to three or
more months of expenses so that you could survive
without any income at all, or in case you have an
unexpected expense. An emergency savings fund can
prevent a short-term setback from significantly derailing
your financial security.
Lifelong career success does not come easily
to anyone. In any field of employment, there are
people making a comfortable living, but what those
people have in common is that they enjoy what
they are doing so they put in a consistent effort,
overcoming the inevitable obstacles that stand in
the way of success.
This material has been prepared for informational and educational purposes only.
This information is not intended to give legal or tax advice.

3. Additional considerations at each life stage
The above plan, consistently followed, has an excellent
chance of getting you to your goal of financial security.
The following additional guidance is consistent with these
four steps, tailored to each stage in your life cycle. You
may find the following ideas helpful.
In your 20s, start an excellent life-long habit by
keeping your expenses down. Buy a modest house and
start pre-paying the mortgage. Buy a used or inexpensive
car for cash, and keep it until it falls apart. Build up
enough savings in the bank so that you can go three
or more months without any income at all. Start
contributing to your employer’s 401(k) plan, and make
sure you put in enough to get the full employer match.
Get a job that you enjoy, soak up as much knowledge as
you can, and seek to advance.
In your 30s, you may be able to afford a nicer house
and nicer cars, but stick to houses that you can pay off
within ten years and cars that you can purchase for cash.
Max out your 401(k) contributions, and open a 529 plan
to start saving for your children’s college expenses. By
now, you should know enough to really advance in your
career, or perhaps open your own business.
In your 40s and 50s, stick with the program.
You should be well on the path to being totally debt
free, including owning your house free and clear, and
you should be saving for retirement. Do not go into debt
to pay for your kids’ college. They should pay a share,
because in the short run, it will make success in college
more important to them, and in the long run, it will teach
them the value of money.
In your 60s and 70s, you situations start to change.
Consider long-term care insurance, because assisted
living care may be the one thing that can unexpectedly
bankrupt you now. If you have been taking investment
risk, you may want to pare back. If you have no monthly
pension and are in good health, consider buying an
annuity that provides a guaranteed income for life to
ensure that you never run out of money. And, if you are
house rich but cash poor, you might want to look into the
option of using a reverse mortgage to tap into your home
equity.
Annuities are designed to meet the long term needs for
retirement income. They provide guarantees against
the loss of principal and credited interest due to market
decline, and the reassurance of a death benefit for
beneficiaries. Contract owners have a variety of income
options, including lifetime payments.
Please contact me for a complimentary review.
Regardless of your life stage, it is never too late
to start working on the four steps outlined above
to achieve financial security. The best time to start
with the right habits is now.
This material has been prepared for informational and educational purposes only.
This information is not intended to give legal or tax advice.
By contacting us, you will receive information regarding
insurance products which may be available for purchase.
Ronald M Jennings, Sr. LUTCF
866-601-4811 EXT. 101
jenningsbg@gmail.com
18889 Waring Station Rd #214
Germantown, MD 20874
State Insurance License #