Michele Clark
Clark Hourly Financial Planning - Chesterfield, MO Advisor
17295 Chesterfield Airport Road, Suite 200
Chesterfield, MO 63005 USA
Work 636.375.1813
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Financial Resolutions

December 28th, 2012

I believe that just about everyone has some sort of financially related To Do item sitting on their To Do list.  And they have every intention of taking care of it.  However, so many other more time critical things seem to keep the financial items from getting to the top spot of the list.

If you are going to resolve to get some of your financial To Dos To Done, what actually matters - how it got done or that it got done?  I will come back to that thought in a minute.

When people come to see me they have accumulated a list of tasks, and it is so easy to see how  that happens in our busy lives.

You take a new job – a nice jump up the career ladder.  Something needs to be done with that old 401(k).  But what?   You’re busy with the new job right now.   So you put it on The To Do List.

Your income is higher now with the new job, should you have more life insurance?  Or is the life insurance at work enough?  You did buy some whole life from that guy that came to the house when you first got married.  Is that still the right policy for you or not?  So you put that on The To Do List.

Your kids are getting older, and you haven’t saved as much as you had intended for college.  How much can you afford to put away for their college vs. how much should you be saving for our own retirement?  Well, the kids are in middle school, you have a couple more years, so you put it on The To Do List.

At work they keep changing your investment choices and you don’t know what to pick.  You don’t have the tools to see all of your investments together and create a diversified portfolio that incorporates all of your accounts, but you know that you need to do it one day.  But you don’t have the time right now.  So you put that on The To Do List.

Sometimes when potential clients meet with me in the free Get Acquainted meeting they tell me that they feel bad about not taking care of these things themselves.  I stress to them, that I do not want them to feel that way.  I tell them that when I have electrical problems at the house, I call an electrician.  And when I have serious plumbing problems I call a plumber.  I have had a handy man come to the house a few times to work though lists of little things that were annoyances.  Sometimes you call in a professional to help you with your list.  And it feels great to work on that list.

So if you are making a resolution to get your financial To Do items To Done, make a plan to either do them yourself, or to contact a professional to help you do them.  Because when you mark them off the list, what actually matters – how it got done, or that it got done?

Resolve to take action today!

Have a Wonderful New Year!

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Missouri A+ College Scholarship Program

September 14th, 2012

What is the A+ program?

The Missouri Department of Higher Education has an offering called the A+ Scholarship Program.  If your High School participates in the program, a student can enroll, and by fulfilling certain requirements can earn reimbursement for tuition and general fees for a two year degree at a participating community college or vocational/technical school.

Sign up for the program even if you do not plan to go to community college!

Getting your two year degree and transferring the credits to a four year college is a terrific way to save money on college costs.  However, if that isn’t in your plans, and you are going to go straight to a four year college, and you are a Missouri student, you should still enroll in the A+ program.  Why?  Because there are many four year colleges that are offering scholarships to A+ qualified students, but your high school transcript must indicate that you are an A+ qualified student.  Also, in the summer after high school graduation and before college, some students use the A+ scholarship money take general studies courses, such as math or language arts, at the community college to get a jump start on college, and doing so in smaller more intimate classroom settings, for topics that may be more challenging for them.

What are the requirements to qualify while in High School?

According to the Missouri Department of Higher Education (MDHE) website:

  • Have a written agreement/enrollment form with your school.
  • Have a GPA of 2.5 on a 4.0 scale.
  • Have an attendance record of at least 95%.
  • Graduate with at least 50 hours of unpaid mentoring/tutoring of students, in our school district this is organized by the school.
  • Beginning with the class of 2015, have achieved a score of proficient or advanced on the Algebra I end of course exam.
  • Must apply for financial aid using the FAFSA form.
  • Attend an A+ school for 3 years prior to graduation; exceptions are made, see the MDHE website.
  • Maintain a good record of citizenship and avoid drugs and alcohol.
  • Be a US citizen, permanent resident, or lawfully present in the US.

What is and is not covered

The scholarship covers tuition and general fees but does not pay for books, supplies or lab fees.

It is quite a good deal and an opportunity for families to save thousands of dollars if they use it exactly as it was set up and go to a community college or technical/vocational school.  Or save hundreds if not thousands of dollars, depending on the type of scholarship you get, at the four year colleges that are offering A+ students money to skip the community college and come straight to them.

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Garrett Planning Network Retreat

August 31st, 2012

The Garrett Planning Network 12th Annual Retreat was recently held in Denver Colorado.   I am a member of the Garrett Planning Network.  It is a group of about 300 financial planners that offer financial planning on an hourly basis, each member owns their own firm.  I have written about the Garrett Planning Network before.

I attended the conference and earned continuing education credits by going to various educational programs, which I need so that I can keep my designations and licenses such as:

  • CERTIFIED FINANCIAL PLANNER
  • CHARTERED RETIREMENT PLANNING COUNSELOR
  • NAPFA Registered Financial Advisor

During the four day conference I attended various educational programs such as:

  • Factors That Have the Biggest Impact On Your Client’s Long Term Financial Plan
  • Understanding Longevity
  • Paying for College
  • Curing Social “In-Security” Part 1 and 2

Kent Smetters, PhD, the Boettner Chair Professor, at the Wharton School, at the University of Pennsylvania, and former Deputy Assistant Secretary for Economic Policy of the United States Treasury, gave the Keynote address. Dr Smetters provided comments on the impact of using one model portfolio for all of a client’s investment goals vs. individual goal-based asset-liability matching.

Throughout the year, the Garrett Planning Network, has three or four conference calls each month.  One of the most beneficial outcomes of my annual trip to this retreat , is getting together with this group in person.  They are a terrific group of professional financial planners who, like me, work with clients on an hourly basis.  We share ideas and act as a resource for each other all year, so it is so nice to get together once a year and see each other.

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Retirement Plan: 10 Expenses to Consider

June 24th, 2012

Part of the process of determining if you can afford to retire, is to run the numbers to see if the amount of money you have saved plus any expected income you may receive from pensions and Social Security will cover all of your expected expenses throughout retirement.

After working with people for so many years, the one thing I have noticed is that many people have faithfully kept spreadsheets of their day-to-day living expenses and have used those figures to help create their retirement plan.  People often come to me to check their thinking, when they are a few years away from retirement, to make sure they are on track to retire.

However, I often discover that people overlook the irregular expenses when planning for retirement on their own.   And it is the irregular expenses that can derail a retirement plan, and cause stress and sleepless nights.  The tricky thing of course is trying to see into the future and figure out what possible expenses can occur.

Here is list of some of the potential items that you might consider adding to your retirement plan.  They won’t all pertain to you, but I hope they will get you thinking about what your retirement could look like, and help you plan for your future.

Replacing cars

I often hear people say that they will just use the same car throughout retirement.   And if you do not work with retired people on a regular basis like I do, I can see where you might think that.  When you are pre-retirement age, retirement seems like a phase of life that is a mysterious unknown.  So I ask them how often they replace their car, and I usually hear answers like every 6 years or every 10 years, and everything in between.  A married couple that retires at 65 and drives until 85, replacing cars every 6 years,  will buy 6 cars in retirement.  I wrote a blog about the impact of inflation on car prices in retirement, many people are very surprised when I show them the expected price of the last car they will buy in retirement.

Travel for fun

When I ask people what they want to do when they retire, travel is one of the first things people say.  If you see travel in your future, think about how often, and what type of travel, do some internet searching to get a ball park estimate of the cost that would be involved.

Travel to see the grandkids

Don’t forget about travel to see the grandkids, I mean your adult children.  Who am I kidding?  You are taking a trip to see those adorable grandkids!  If your family is like so many these days, you might have to hop on a plane to feel those little arms wrapped around you.  With Skype, you don’t have to be there to see them anymore.  But no technology can replace an in-person visit.   Trust me; you will want to plan for this expense.

50th Wedding Anniversary Celebration

In this day and age, fifty years of marriage is an especially wonderful milestone.  Some families have a dinner reception, inviting extended family and close friends, which can be the size of a small wedding reception.  I have also seen couples treat families to Disney vacations or to cruises.  If you have dreams of recognizing a milestone with a special celebration, don’t forget to plan for it so that when the time comes, you can relax and enjoy it.

Medicare

What?  It isn’t free?  No, I am sorry to have to tell you, it isn’t.  And I find that I am often the first to break this news to people.   Because if they have never had to help a family member through the process of signing up for Medicare and they are more than a few years away from retirement, then researching “How does Medicare work?” usually hasn’t crossed their mind.   Luckily there are some good resources such as www.medicare.gov and for Missouri residents www.missouriclaim.org.

Long Term Care/Nursing Care

In 2012 the average annual cost of care in a nursing home in Missouri is approximately $55,000.  The cost of nursing care has been increasing considerably faster than inflation.   One way to offset the risk to your portfolio is to consider Long Term Care insurance that would cover a portion or all of the cost of care, depending on your risk tolerance and the affordability of the premium.  I am a fee-only advisor so I do not offer insurance products, but I have recommended that some clients get Long Term Care insurance.  Other clients have been able to self-insure, each situation is different.  But you do need to consider the impact a stay would have on your portfolio.  To learn more read my blog post Long Term Care Insurance: Protect your nest egg.

Big delayed purchases

Have you been dreaming of a cross country trip in a motor home?  Or does the water call your name so a boat is more to your liking?  Don’t forget to set aside some money for upkeep and repairs.

Home Improvements and Major Maintenance

If you are in your forever home, factoring in the large inevitable maintenance projects such as replacing a roof or HVAC system will help prevent money stress later on down the road.  Also, after a few decades, kitchens and baths tend to need updates.  Remodels with an eye toward aging gracefully in place are also becoming quite popular.  Consider the age of your home and prior remodels when planning future income needs.

College and Wedding/Rehearsal Dinner

Depending on the age of your children, you may have college and wedding/rehearsal dinner expenses in retirement.

Care for a Family Member

Will a loved one be financially dependent upon you, such as a parent or a special needs child?  If so, you might consider meeting with an elder care attorney or estate planning attorney that specializes in special needs trusts.

These are a few areas to consider in addition to everyday living expenses when you are creating your retirement plan.

 

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Financial Doing: Because if it’s just Financial Planning, it will never happen!

June 1st, 2012

I have a theory that just about everyone has important financial To-Do items sitting on their To-Do list.  However, those financial To-Dos often just sit there because there isn’t a looming deadline to make them seem urgent (“Save for college and retirement?  Oh that’s so far away!”).  You can read more about my philosophy in      It’s on your To-Do. Let’s get it To-Done!

Let’s say you decide to address those To-Do items so you create a financial plan.  Well a plan will not help you if you do not implement it!  So let’s take you from Financial Planning to Financial Doing!  For those of you who have taken the step of creating a plan, I would like to give you some easy things to do so that you can get some momentum going on your path to Financial Doing!

Here are some quick things you can do and knock off of your To-Do list…

Social Security

If you are under 60 years old, the government does not mail you a Social Security Benefits statement any more.  Learn how easy it is to pull up a copy of your statement online in my blog post Full Social Security Statements Now Available Online.

Annual Credit Report

You know you should get your free copy of your credit report each year, but with so many advertisements you aren’t sure where to go.  I clear up the confusion in my blog post Annual Credit Report: Where to go to get your free credit report.

Lost Money

This one is just a “no brainer”; it takes only a few seconds to check to see if you have lost money.  One in ten Missouri residents does.  Are you one of them?  Missouri Unclaimed Property: Are you due some money?

Take the first step today to change your Financial Planning to Financial Doing, I promise, it will feel great to finally start attacking the To-Dos!

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