1. Thoughts on Lifespan Financial Planning Peter Raeth, Ph.D. Career Development Facilitator http://InformationAnthology.net/CareerMentor

2. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor What we will talk about Getting started Getting started Avoid debt Avoid debt Managing life Managing life Financial foundations Financial foundations Future planning Future planning

3. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor A layman’s advice from experience I am not a financial advisor, just a common layman I am not a financial advisor, just a common layman Seek advice from a trusted fee-based certified financial advisor Seek advice from a trusted fee-based certified financial advisor Want to share thoughts from personal experience Want to share thoughts from personal experience Will offer ideas most don’t consider until too late Will offer ideas most don’t consider until too late Hope to help others grow financially from their lifetime of work Hope to help others grow financially from their lifetime of work

4. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor New Graduates You graduate and find a job You graduate and find a job What do you do with that first pay check? What do you do with that first pay check? Likely more money than you have ever seen at a single time Likely more money than you have ever seen at a single time Represents opportunity, not invitation to spending Represents opportunity, not invitation to spending need to live below your income need to live below your income not necessary to chase fads or follow the crowd not necessary to chase fads or follow the crowd newspaper shows where the crowd has ended up regarding debt newspaper shows where the crowd has ended up regarding debt Many people graduate and promptly go into such debt that they will be years paying for things that depreciate much faster than the debt can be repaid Many people graduate and promptly go into such debt that they will be years paying for things that depreciate much faster than the debt can be repaid Big difference between needs and wants Big difference between needs and wants not at all the same things not at all the same things don’t kid yourself into turning wants into “needs” don’t kid yourself into turning wants into “needs” Be excessive in satisfying wants and you will always be poor Be excessive in satisfying wants and you will always be poor

5. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Be Master of Debt – Not Mastered by Debt Don’t be suckered into the slavery of debt Don’t be suckered into the slavery of debt You can’t easily wash your hands of debt You can’t easily wash your hands of debt very hard to get out of debt caused by excessive “want” satisfaction very hard to get out of debt caused by excessive “want” satisfaction Instead of spending, save and invest Instead of spending, save and invest Establish your financial foundation Establish your financial foundation thereby your financial freedom thereby your financial freedom You are NOT free to choose if you are enslaved by debt You are NOT free to choose if you are enslaved by debt since your first focus has to be earning money now to pay past debts since your first focus has to be earning money now to pay past debts You can’t make the choice, for instance, to start a new career You can’t make the choice, for instance, to start a new career Slaves to debt have to focus on near-term income Slaves to debt have to focus on near-term income It becomes a vicious cycle It becomes a vicious cycle

6. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Manage professional life like a business Basic Activities Basic Activities plan for future plan for future execute plan execute plan revise plan as needed revise plan as needed perform due diligence perform due diligence provide to market provide to market maintain what you provide maintain what you provide improve what you provide improve what you provide manage income manage income manage expenditures manage expenditures make profit make profit invest profit wisely invest profit wisely  Watch cash flow – if you want to leave a job, be sure you have a way to replace that income first – ensure income exceeds outgo – prepare for future financial events

7. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Basic Financial Foundation Insurance Insurance Health Health – extremely expensive to cover on your own – for instance: one car accident can wipe you out financially Life Life – to protect your family and your estate Disability Disability – it happens – I myself have been on medium-term disability due to eye surgery Auto Auto – covers your health and the other party’s – also covers damage to material things Possessions Possessions – no need to lose everything because of an accident Home Home - a major purchase needs to be protected

8. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Basic Financial Foundation (more) Savings (liquid) Savings (liquid) 4 to 6 months operating capital without working 4 to 6 months operating capital without working don’t let layoff put you into foreclosure or bankruptcy don’t let layoff put you into foreclosure or bankruptcy Investments (less liquid) Investments (less liquid) balanced for your point in life balanced for your point in life a good fee-based financial advisor can guide you in this a good fee-based financial advisor can guide you in this don’t just “play the lottery” don’t just “play the lottery” don’t respond to pump-and-dump emails don’t respond to pump-and-dump emails if nothing else, read Value Line if nothing else, read Value Line aid to due diligence aid to due diligence available at most libraries available at most libraries highly regarded investment newsletter highly regarded investment newsletter

9. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Future Planning What outcome do you want to achieve in life? What outcome do you want to achieve in life? Educate yourself so you can make good choices Educate yourself so you can make good choices Where are you now financially? Where are you now financially? Where do you want to be, when, doing what, having what? Where do you want to be, when, doing what, having what? Work with a trusted fee-based financial advisor Work with a trusted fee-based financial advisor Develop a solid plan Develop a solid plan Review that plan annually – Keep that plan up to date Review that plan annually – Keep that plan up to date Be sure to address negative possibilities Be sure to address negative possibilities Plan too for life’s big events Plan too for life’s big events Implement the plan – Don’t let “gotta have” get in the way Implement the plan – Don’t let “gotta have” get in the way Adjust plan over time according to results, conditions, events Adjust plan over time according to results, conditions, events

10. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Let Time Work for You

11. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentor Plan Necessary Debt vs. Income Want majors debt paid by age 55 Want majors debt paid by age 55 Want minor debts paid at end of each month Want minor debts paid at end of each month Develop self-sustaining income Develop self-sustaining income independent of work hours independent of work hours wise investments necessary wise investments necessary consult trusted fee-based financial advisor consult trusted fee-based financial advisor pick this person carefully pick this person carefully due diligence absolutely necessary due diligence absolutely necessary you can’t just work blindly you can’t just work blindly Self-sustaining income gives you freedom to choose Self-sustaining income gives you freedom to choose

12. Copyright 2011 by Peter Raeth, Ph.D., http://InformationAnthology.net/CareerMentorSummary Recognize the vast difference between needs and wants lest you become a slave to debt. Be excessive in satisfying your wants and you will always be poor, perpetually unable to do the things you really enjoy. Your financial foundation must be firm and free of debt. Recognize the vast difference between needs and wants lest you become a slave to debt. Be excessive in satisfying your wants and you will always be poor, perpetually unable to do the things you really enjoy. Your financial foundation must be firm and free of debt. Seek advice from a trusted fee-based certified financial advisor. Do your due-diligence before selecting such an advisor. Seek advice from a trusted fee-based certified financial advisor. Do your due-diligence before selecting such an advisor. Use insurance wisely to cover unexpected events. Important categories of insurance are: health, life, disability, auto, possessions, home. Use insurance wisely to cover unexpected events. Important categories of insurance are: health, life, disability, auto, possessions, home. Have all major debts paid by age 55. Pay minor debts monthly. Use credit cards only for convenience. Do not carry credit-card debt. Have all major debts paid by age 55. Pay minor debts monthly. Use credit cards only for convenience. Do not carry credit-card debt. Time is your friend. Let it work for you. Put a plan in place, follow your plan, and review your plan annually. The earlier you begin the better. To earn self-sustaining financial stability, establish a productive career based on a strong study/learn/work/produce ethic early in life. Time is your friend. Let it work for you. Put a plan in place, follow your plan, and review your plan annually. The earlier you begin the better. To earn self-sustaining financial stability, establish a productive career based on a strong study/learn/work/produce ethic early in life.