Episode 142: Financial Matters You Don’t Want to Put Off
Today’s Prep:
We can all procrastinate at times. But when it comes to our finances we need to plan ahead. David shares key areas in your finances you don’t want to put off addressing.
Equipping Points:
How much trouble can we get into when it comes to procrastinating these financial matters? For some of these things you only get one chance to get it right, so make sure you handle it now instead of waiting until it’s too late.
Should you defer your taxes? Some like to take the tax breaks now and defer the taxes while others invest in a Roth to pay the taxes. Which is better? Consider the taxes now and know that it is most likely to go up. Your choices today will have a big impact on what kind of taxes you’ll pay in retirement.
How quickly do you need to get rid of debt? David says there are certain kinds of debt you absolutely must get rid of right away. If you are in your 40s and have credit card debt, you need to figure that out right now. You cannot carry consumer debt into your retirement if you want to have the retirement that you’re dreaming of. What about a car payment? Or a home mortgage?
How much time do you have to set up your legal and estate documents? This is urgent, especially if you have a young family. Make sure your beneficiary designations are right, both primary and secondary beneficiaries. If you’re in your 30s and 40s with a young family, cheap term life insurance is critical. You also want to designate beneficiaries for your bank account, your car, and your home in order to avoid probate.
Is delaying Social Security a good idea or a bad idea? How do these numbers break down? David shares examples of what this can look like in retirement. There are reasons to delay it and reasons to start it as soon as you can. You may also want to choose a different time for each spouse if you’re married. There are a lot of nuances to when you start Social Security, so make sure to get good advice on when to start it and see how it fits with your overall financial plan.
Finally, when should you put that financial plan in place? You don’t want to launch into retirement without a plan. If you’re in your 20s, 30s, and 40s, your goal can be relatively simple. But once you get into your 50s, you have to have a plan. You don’t want to get to retirement and have fewer options than you would like to have. Reach out to an advisor to get a plan that suits your goals and needs.
Today’s Takeaway:
“Credit card debt or consumer debt is like rust on your car or termites in your house–it’s eating away at your financial future, you just might not be able to see it.”
– David Dickens
KC Financial Advisors Blog


