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Living for Today and for Tomorrow

Life is about finding the right balance, whether it be with diet, exercise, or your finances.  Do we sacrifice today for a richer future, or do we live it up today and worry about the future when it gets here?

Most of us are trying to manage multiple goals at the same time; that is true in our financial lives also. Enjoy life today; pay off debt; save for future goals….retirement, children and their education; build emergency funds; or build funds for a future large purchase.

Do Americans have financial balance in their lives? The results of a recent survey from Bankrate indicate the answer is no. Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses--enough to help cushion the blow of a job loss, medical emergency or some other unexpected event--according to the survey of 1,000 adults. Meanwhile, 50% of those surveyed have less than a three-month cushion and 27% had no savings at all! Only 48% of respondents to a Federal Reserve study said that they would completely cover a hypothetical emergency expense costing $400 without selling something or borrowing money. I wouldn’t be able to sleep at night in that situation.

Even households earning at least $100,000 are finding themselves pinched, with 1 in 4 saying they sometimes live from pay period to pay period.

Hopefully these statistics are a wake-up call. I hope that in the future, we see Americans develop a healthy relationship with money. Balance is what’s required. I believe that thrift is a virtue, and I don’t intend to abandon it. But thrift can also be a vice if taken to an extreme. It’s not wrong to spend money on yourself, if you can afford it. Money is a tool, and it should be used to bring us joy, when possible.

A healthy relationship with money is creating a balance between needs, wants, and savings. These three change at different points in our lives. Younger/working readers may want to have a greater portion going to savings; older/retired readers may actually be depleting their savings in retirement, which is OK provided it won’t leave you broke. When most people look at their spending, they typically find a greater portion than they realized was going into the “wants” category. A budget is a great tool to evaluate the needs, wants, and savings categories.

We have created a unique planning process, WealthWATCHSM  Life Stage Mapping to assist us in developing a personalized financial plan. WealthWATCH Life Stage Mapping begins with a realistic assessment of your financial situation in context of general life-stage requirements. Our experience in advising thousands of hard-working people suggests we all travel down similar roads, even though we may have different destinations both financially and emotionally.

We have identified five distinct stages most of us pass through during our adult lives. While each of us and our personal situations are unique, there are similarities we typically face in these five distinct life phases.

The uncertainty of knowing just how much money one will need over decades of retirement is at best an educated guess. So, we plan based on averages. We decide on what the desired lifestyle will probably cost, make an assumption about inflation, causing adjustments to future purchasing power, and then go on to estimate a joint lifetime survival estimate. Using these factors, we can at least come up with a "number” as to how much we will need for the rest of our lives to maintain our current lifestyle.

During the years prior to retirement, we are faced with how aggressively to save versus spend. Sometimes it is obvious that we will easily reach our goals and can spend more of our income. Sometimes the opposite is true. This process requires periodic reappraisals of whether or not we are likely to reach our accumulation goal.

All you need to do is to take some time to figure out what is important to you now. Be sure to write everything down on a list. What is important to you today? Getting out of debt? Buying a house? Traveling? Next, you need to think about what you want your future to look like.

The quest to achieving financial balance is about more than money. It’s also about meaning. Money is important, yes, but it’s not the only thing. Money is a means, not an end.

Each of us has parts of our lives that feel unbalanced. When we experience this lack of equilibrium, it’s important to do something about it, to make changes. From our experience, however, the most effective changes are small — they’re incremental. When we overcompensate for an imbalance, we sometimes just make ourselves miserable in a different way.

As you can see, living for today or saving for the future isn’t an either-or situation. You can easily do both, especially once you take the time to figure out what is important to you. Interested in a complimentary consultation? Give our office a call today.

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Credit Unions vs Big Banks

By Lineweaver Financial Group
July 26, 2019 Category: Credit Unions, Pse, Big Banks, Savings, Checking, Banking

Often times, credit unions grow up around a community, or a place of business, and the PSE credit union is no exception. The PSE Credit Union has been around since 1955, and originally started as the Parma City Employees Credit Union, and now, anyone can become a member. Many people understand the difference between credit unions and big banks, but what is it specifically that sets them apart? At the PSE Credit Union, its that they are a not-for-profit business, as opposed to the big banks, which are for profit. Instead of having to appease their shareholders, their goal is to serve their members. In their eyes, whats best for a banks shareholders isnt always best for the customers as a credit union, whats best for theircustomers their primary goal. This can often translate to better service and member satisfaction. For example, according to the most recent annual American Customer Satisfaction Index, credit unions scored an average of 86% for customer satisfaction, while the average

Economic Commentary: Q3 2019

By Lineweaver Financial Group
July 02, 2019 Category: Economic Commentary, Review, Q3

Investment Directions - Staycation or Vacation? Sell in May and go away is an old maxim for investors. Evidence is mixed on its validity, but given this years rally, the temptation now is understandable. Our take: consider taking some profits and rotating into exposures that offer more resilience if volatility returns. Think of it as the investor version of a staycation and catch up on chores. With that in mind, our take on the major investor themes for the weeks ahead: U.S. Equities: Reverting to Technology We remain overweight U.S. equities, and one of our favored sectors is technology. Even with strong performance this year, we believe the sector remains appealing. Technology firms tend to have strong balance sheets and enjoy support from longer-term trends, attractive qualities in a late economic cycle. Furthermore, tech stocks have historically fared well through various yield curve regimes. Developed Markets: Europe Poised for Revival? Investors in Europe have had little reason

Healthwatch: Tips for Lowering Your Risk of Dementia

By Lineweaver Financial Group
July 02, 2019 Category: Dementia, Healthwatch, Health, Q3

Theres no effective treatment for dementia, which affects 50 million people worldwide, but the World Health Organization (WHO) says theres much that can be done to delay or slow the onset and progression of the disease. In May, WHO issued the following recommendations to reduce the risk of dementia globally, and combat cognitive decline: Regular physical exercise Dont use tobacco Drink less alcohol Maintain a healthy blood pressure Eat a healthy diet, particularly Mediterranean foods Avoid dietary supplements such as Vitamins B and E WHO said there are 10 million new cases of dementia every year, and this figure is set to triple by 2050. The disease is a major cause of disability and dependency among older people and can devastate the lives of affected individuals, their careers and families, the organization said. Although the report stressed that social participation and social support are strongly connected to good health and individual well-being, it said there was insufficient

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