Your Family’s Financial Future.

20 Sep

We heard from experts in banking, financial planning, and estate planning on the basics of planning for your family’s future.

Momtime’s own Casey Stringham had a career in personal, business and private banking for high worth individuals in Nashville, and managed a bank in Denver.  Scott Gajeski is an investment advisor with US Bancorp’s Private Client group.  Erica Johnson is an estate attorney with Ambler & Keenan.

Budgeting and Financial Planning:

  • Create a budget by writing down your expenses for a month.  Use these numbers to determine a realistic budget for yourself (if you can’t live without a daily Starbucks, where else can you cut spending?).
  • Pay yourself first: i.e. make sure you put away money in savings. Contribute to your 401k and IRA.
  • Pay down debt.  Prioritize what to pay off first based on interest rates and tax deductions.  Credit cards usually have the highest interest rates and cannot be deducted from your taxes, so pay those off first.
  • Have an emergency fund (6 months’ worth of expenses in case you lose your income).
  • Manage your credit score and credit history.  Pay bills on time, don’t carry too much credit (such as store cards you don’t use anymore), and have a variety of credit – student loans, mortgage, credit cards, etc.

Investing and Retirement Planning:

  • In your 30s make sure to do the minimum contributions for your 401k and IRAs. Check calculators on
  • In your 40s (or when you are approximately 15 years away from retirement) start your retirement planning: examine the investments you made in your 30s to see if they have made money for you.  Change your investments to meet your retirement goals.
  • If you have multiple 401ks from previous employers, consolidate them into one IRA (either a traditional or ROTH). Use an “election form” to move the money.  If your 401k does not have an election form available, request a direct roll over to another financial institution.
  • It is better to convert old 401ks into an IRA because it gives you control over your money instead of giving your old employer the control.
  • Meet with a financial planner to determine if you need someone to manage your investment (stocks) and retirement accounts.  You may be able to do it yourself, but at least get a “check up” from an expert to see where you stand.  Most financial planners and investment advisors offer a free consultation.  Ask friends for recommendations or ask to meet with your bank’s investment advisor as a starting point.

College Planning:

  • If you are financially able to set aside the total cost of tuition NOW, put it in an account that will grow at least 7% annually (4% tuition increases plus 3% inflation).  If you don’t have the money now, you will have to grow whatever you have at more than 7% annually.
  • 529s are the most common investment account people use for college planning.  Anyone can contribute to it, but the money must be used for education.  If your child decides not to go to college or gets a full scholarship, the money has to be transferred to someone else (another child, a relative, etc.) who will be attending college.
  • You can also set aside money in a ROTH IRA or use life insurance to pay for college tuition.

Estate Planning:

  • Click to view Erica Johnson’s presentation on Estate Planning 101.
  • If you do not create a will or trust, when you die your surviving family (spouse, children, parents, or extended family members in that order) will have to go through lengthy and expensive court proceedings to distribute your assets.  You will save your spouse and children a lot of hassle by setting up a will (and trust if you choose) before it’s too late.
  • You should also designate a guardian for your children in the event you and your husband are unable to care for them.  Again, it saves a lot of drama if you designate this person now, rather than leaving it for family members to decide after you are gone.
  • Most people designate their spouses as their Durable Power of Attorney (to handle financial decisions) and Medical Power of Attorney (to handle all healthcare decisions), but you can choose a sibling, parent, or whomever you feel will have your best interest at heart.
  • A living will is important for family members and doctors to know your wishes if you are ever incapacitated and unable to communicate.  It covers how long you want to be on a feeding tube, on life support, etc.
  • Beware of downloadable estate planning forms available on the internet – at the very least you should have an estate attorney look over your documents to ensure your wishes have been communicated according to state laws.
  • Check with your (or spouse’s) employer if they have a legal plan you can subscribe to.  Typically you pay a monthly premium in exchange for legal coverage from a directory of attorneys.  This can be an affordable way to create estate planning documents if this benefit is available to you.

If you have further questions, please click the speakers’ names at the top of this post to contact them.  Even if you do not want to use their services, they are happy to refer you to others in their fields.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: