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By JERRY LYNOTT [email protected]
Monday, January 06, 2003 Page: 1D
With age comes wisdom, the saying goes. But, it goes without saying, it’s
wise at any age to seek help with personal finances.
Retirees’ needs differ from those of college students. Newlyweds have
different priorities than parents planning for their children’s future.
Certified financial planner Thomas R. Bucci of Kingston said anyone can
benefit from professional help to make the right financial decisions as their
lives change.
The new year is a good time to start.
“The new year offers a time to set or re-evaluate financial objectives or
goals,” Bucci said.
For 20-year-olds, it’s not too early to begin to accumulate capital and
assets, Bucci said.
But that age group “should be wary of loading up on too much debt,” which
can have long-term consequences for savings and credit.
Risk management or insurance becomes more important for people in their
30s, Bucci said. For families, saving for college and estate planning move
into the forefront.
The 40s become the peak earning period, Bucci said. Capital accumulation
should continue with an eye towards tax planning and the focus on retirement
should sharpen.
Retirement planning and investments should get more attention from people
in their 50s. People should make sure their plans are “going to get them
where they need to be,” said Bucci.
When retirement comes in the 60s, ensuring consistent income with a low
level of risk is the focus, he said.
People in their 70s should look to estate planning, which includes gifting
to their children and grandchildren.
Guidelines are one thing, trying to follow them is another.
“Managing your finances today is rocket science,” said Steve Rhode,
president and co-founder of the nonprofit financial management organization
Myvesta.
Consumers don’t have access to information to make the best financial
decisions possible, said Rhode, adding that’s all the more reason to seek out
professional help.
You have a doctor to take care of your ills, an accountant to do your taxes
and a mechanic to fix your car, he reasoned. Finances demand the same
attention and Myvesta can do that, said Rhode.
How do you know you’re getting the best deal on your cell phone, he asked.
Can you get a better interest rate through your credit card company? What
about your car insurance or mortgage? Are you prepared for retirement?
“Everyone is well-intentioned” when it comes to managing personal and
household finances, Rhode said.
“People think they’re doing well by themselves. The reality is the exact
opposite.”
Take people in their 50s, as an example. They realize they’re close to
retirement and start overinvesting to try to catch up, he said.
But at that period in life, they should have the security of knowing they
have a retirement plan in place and the opportunity to enjoy themselves.
Retirees want to be able to manage their money and make it go as far as
possible, he said.
Someone who is in college and away from home for the first time also wants
to be smart in his or her spending habits. In addition college students have
to protect themselves against identity theft and even roommate theft, said
Rhode.
An annual credit report can detect identity theft, said Rhode. It also
serves as starting point to sound financial management.
Start with a consolidated credit report rather than individual reports. The
consolidated report is quicker and more current.
Look for instances of identity theft in which someone opened an account in
your name. Look for inaccurate information and look for old accounts that are
still open but no longer used – a department store charge account for example.
Closing old accounts can improve your credit score, said Rhode.
But be careful in deciding which account you close, he warned. An old
account can help because credit score considers how long the account has been
held.
One can be financially responsible and spend money without feeling guilty,
said Rhode. “It’s all about balance.”
Jerry Lynott, a Times Leader staff writer, may be reached at 829-7237.