Click HERE for to read stories published in the June 12 – 25, 2019 issue of Gilroy Life

Most Gilroy parents try to encourage their kids to stay disciplined and never stop learning. At a young age, most kids discover, what is learned in school often erodes during the course of summer and as school finishes this has been top of mind for many. This erosion can lead to a need for refresher courses and tutoring come school’s commencement each fall.

Planning your financial future is really no different and we’ve seen more and more clients not doing things soon enough which can limit planning options.

Learning financial discipline can feel like torture. When we make money as young adults, most of us spend it quickly, until we develop some self-discipline. As adults, we discover financial discipline can get easier, but paying your dues is necessary. It must be developed, over time, like a muscle. Short cuts don’t exist and too often we find people start planning but fail to keep up with it. Just like in school, sometimes refresher courses are needed to progress and avoid financial failure. As the old adage goes: “No one plans to fail, they just fail to plan.”

Recently, we were sought out by a local couple who had their financial plans on autopilot. The financial person they had been dealing with for several years left the business, so no one was servicing their accounts. Retirement accounts were not matched to the couple’s risk tolerance. Their living trust hadn’t been updated since 1999 and they had no idea if their savings could sustain their lifestyle through life expectancy. They had lots of debt and no life insurance or assets to collateralize a sizeable mortgage balance. To make matters worse, they both had medical conditions that would prevent them from getting any affordable coverage to address long term care needs in their later years.

Furthermore, beneficiary designations on accounts hadn’t been changed since the couple married which meant their former spouses would receive any monies should they pass unexpectedly. While we were able to improve their situation some, much more could’ve been done had they not waited so long.

Just like with subjects in school, the example above proves refresher courses for financial planning are needed periodically.

Examples of items you should review regularly are as follows:

  • Living Trusts/Wills
  • Retirement Accounts
  • Beneficiary Designations
  • Investment Account Structure and Performance
  • Medical Needs — including planning for end of life medical expense
  • Life Insurance
  • Exit Strategies and Succession planning for Business Owners

We encourage everyone who has been procrastinating on addressing planning needs to address them with a financial professional. For those with money in at-risk investments, we advise safeguarding some of that money from market downturn. There are products available that can offer market returns with protection of your principal.

If you haven’t performed a review recently, the time for you and your loved ones to do so is now. You’d be surprised how many families never address planning jointly with next of kin. Words of encouragement can go a long way in these areas, especially for younger generations that may not understand the unspoken obligation to help take care of our parents as the get older in age. As you consider starting to address these areas, remember Newton’s law, “An object in motion stays in motion and an object at rest stays at rest.” Contact a professional and start taking baby steps today.

Brian Harrigan and Bob Price are the owners of Executive Plan Design. They are located at 8355 Church St. and you can reach them at (408) 767-2572.