Financial Planning

Remember, hope is not a viable strategy…you must plan for your goals.  Wishing you a healthy and prosperous 2017!

1. Create emergency savings.  Life is full of unexpected emergencies, and having extra cash on hand can help keep a serious illness, home repair, or other sudden financial need from derailing your finances. Prepare for unpredictable expenses by putting aside 6 months of expenses in an easily accessible cash-equivalent account.  

2. Make a monthly budget and stick to it.  Budgets may sound like a lot of unnecessary work, especially if you’re financially comfortable. But if you’re not tracking your spending, you may be surprised by how quickly it adds up — and which expenses are costing you the most. As 2017 begins, set a budget and work on sticking to it for 3 months. Track your performance and revise the budget, as needed. Don’t aim for perfection; instead, try for incremental improvement.

3. Save now for retirement.  Contribute 10% of your salary to your employer retirement plan, and give yourself a raise each year. You might try increasing your contributions by 1% each year. A 1% increase may not sound like much, but it could make a big difference over the course of your career.  Also, one of the best ways to boost your retirement savings is to take advantage of any matching funds offered by your employer.

4. Pay down high-interest debt.  Don’t let high-interest debt, such as credit card debt, keep you from getting ahead financially. If you’re carrying a significant amount of debt, make paying it down a top priority this year.

5. Plan now for rising college costs.  Start saving for your kids’ college early, but don’t expect to have it fully funded. Most people pay tuition from their income when the time comes.  Keep this in mind: Your child can get financial aid for college, but there is no financial aid for retirement. While college savings are important, focusing on your own retirement should take precedence. Short-changing your retirement savings could end up costing you big-time down the road.

6. Review your account beneficiaries.  As life changes, you need to periodically review and update these. Since beneficiary provisions are independent of your will or other estate provisions, keeping them current is critical.

7. Update your will.  Do you have one? If you do, how long ago did you check it? Circumstances change, and they need to be accounted for in your estate plan.  Whether we like it or not, death is a certainty. Dying without an up-to-date will can cost your family unnecessary pain and money.

8. You should have life insurance if you are married and/or have children.  If you already have insurance, review your coverage to make sure it is enough for your family’s needs.  Basic coverage through your employer is often not enough.  Term insurance can be inexpensive to buy for healthy individuals.

9. Schedule times to discuss finances with your spouse. If you (or your spouse) rarely get involved in the family finances, now is the time to start. Work together to make financial decisions and make sure that each of you understands the overall game plan for your finances. At minimum, make sure that your spouse knows how to access financial accounts and understands your wishes.

10. Teach your kids the value of money.  Assign certain chores or special projects to earn spending money. Take your kids to work so they know what you do to earn money.

Kathryn Palao, Certified Financial Planner®, Vice President & Investment Advisor Representative at Hudson Financial Services, Inc. in Briarcliff Manor.

Tel: (914) 762-4760.


Investment advisor representative offering securities and advisory services through Cetera Advisor Networks LLC, member FINRA/SIPC.  Cetera is under separate ownership from any other named entity. Hudson Financial Services, Inc. 1249 Pleasantville Road, Briarcliff Manor, NY 10510.

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