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Kelly Ruggles is the author of "The Financial Playbook" for Retirement.
Kelly C. Ruggles, Financial Planner and Educator

Chapter 1- Financial Planning

It amazes me how little, if any, financial planning most people have conducted. The old saying, “No one plans to fail, they just fail to plan” comes to mind. Engaging a professional in your planning process is not only helpful but in many situations paramount to the most positive outcome. After reading this book and doing some research of your own there’s no reason you can’t take an active role in your own financial planning.

Developing your financial plan:

If you plan to live on what you save or have already saved, consider the following:

  • Your health
  • Number of retirement years
  • Expenses to maintain your desired retirement lifestyle
  • Your sources of retirement income and dollar amounts from each
  • Possible need for future long-term care
  • Future economic variables (including inflation, property values, interest rates, taxes)
  • Your investment risk 

Financial planning doesn’t need to be complicated or difficult. In fact, financial planning is simply: 

(1)       Evaluating your present financial situation

(2)       Deciding what your goals are

(3)       Making a road map of how to achieve those goals.

Your present financial situation:

To begin the planning process, list your current financial information - the things you own or have equity in and your income.

Assets and income: 

  1. Income:  earned, investment and other.  Your last year’s tax record is a good resource 
  2. Your home - Other Real Estate: locations and amounts
  3. Automobiles:  how many, what kind, and amounts
  4. Banking: location of checking, savings, money market and certificate of deposits and amounts
  5. Stocks, bonds and mutual funds: location and amount
  6. 401ks, IRAs, annuities – other investments:  location and amounts
  7. Jewelry, artwork, collections, etc:  You might be surprised to discover how much these items are worth. You may choose to have especially valuable items appraised professionally.
  8. Computers - etc: locations, types and amounts
  9. Home furnishings: locations, types and amounts
  10. Sporting goods: Fishing equipment, boats and other sporting items such as your golf clubs, locations, types and amounts 


Determine your liabilities:

  1. Mortgage
  2. Car payments
  3. Credit cards
  4. Debts of any kind 

This gives you a general idea.  For now you can make a guesstimate, but for your own protection and potential replacement, put everything in writing and take pictures and/or videos. A secondary reason to list all you own of value is in the event of fire, a hurricane or theft you will have a record for insurance purposes. Keep an extra copy of this information in a safe location other than your own home if possible.  This may also be a good time to re-evaluate your homeowner’s insurance policy to ensure you have enough coverage to protect everything you would need to replace in the event of a disaster.

Your goals:

If you have never done so, writing down your goals can be one of the most powerful tasks you will ever do. This does not have to be a complicated process. Simply write down your thoughts and you will be surprised at how much you can achieve. Thousands of books and articles have been written on this subject. When you write down what you are trying to accomplish these thoughts are seated in your subconscious. Your ability to accomplish your goals goes up dramatically.

For example:

Are you trying to retire as early as possible? If you’re already retired, are you trying to generate more income and build wealth? Maybe you’re trying to ensure that your children and grandchildren are provided for after you pass away.

Your financial strategy:

Your financial strategy will depend on your goals. It’s important to have a plan you can execute and stick with. Changing your financial goals and plans often because of external input such as ads and tips for new financial services, stocks and annuities will most likely be harmful rather than helpful in the long run.


There are obstacles to overcome and one comes in the form of taxes. The government is good at passing laws to ensure it receives a healthy portion - and then some - of every single dollar you earn, save, and invest. Of course, you can’t avoid paying taxes, however you can minimize them in the planning process.

Often the help of a good financial planner can be invaluable in this part of the process.

Choosing a Financial Planner 

In choosing a financial planner there are many important considerations. In general you want to make sure the planner:

-     Is competent

-     Is someone you like

-     Is someone you can trust

-     Specializes in your age group

-     Represents more than one firm’s investment options


Life is never fair for new advisors: New advisors need clients to gain experience to become proficient. It’s not to your advantage for them to gain their experience through you. I see this often in large brokerage firms as one advisor retires or leaves the business. Their clients are then shuffled off to a new inexperienced advisor. This is not acceptable and you should look elsewhere at once if this happens to you.


Many people don’t bother to check the credentials of a financial planner they’re considering. It is always good to do this. This is not as essential if the advisor has come to you by means of a recommendation. Often the best credentials are experience.  

Conflicts of interest

This criterion should be clear. There is a conflict of interest if a financial planner uses only funds owned or controlled by his or her firm. This is common with many brokerage firms.

       Be honest

Many investors don’t give their financial planner all of their current information. Without a complete picture of current income, assets and liabilities any plan that is drawn up may not be useful.

For instance, if you’ve fallen into credit card debt, you may feel too embarrassed to disclose this to your financial planner; however, he or she may have great ideas on how to help you. Again don’t be embarrassed - financial planners have seen it all. If you don’t disclose all the information your planner needs, your plan will not be complete because it is not based on a true picture of your situation.

If you have a financial planner that you’re displeased with, you may be considering switching to someone new. Here are some points to ponder:

1.   Does your advisor try to force you into making certain investments after you’ve told him or her you don’t understand them?

2.   Does your advisor listen to you? Do you feel he or she understands you, your goals and motivations?

3.   Are your investments truly tailored to your goals and needs? Does your advisor use a “cookie-cutter” or “one-size fits all” approach based on their personal forecasts or those of his or her firm?

4.   Is there a high rate of turnover in your account? Compare a statement from a year ago and see how many investments are still currently in your portfolio. The problems with turnover are at least twofold: transaction fees and short-term gains are taxed at the highest rates. Investing is covered in more detail later in this book.

5.   Are you being steered towards funds or investment products that generate the most profit for your planner or his firm? A dead giveaway here is the appearance of the firm’s name in the fund. It may be a perfectly good fund, but compare its performance against similar funds.

6.   Does your planner make it his business to thoroughly understand your finances? Has he or she asked about your other investments?

7.   Does you’re planner seem knowledgeable about estate planning and how to minimize taxes while achieving your goals?

You should not be confused about your financial matters. You should understand everything he or she explains. If you don’t or if technical terms and jargon are used repetitively, consider finding a different advisor.

Financial Advisor Don’ts

1.   Don’t make your investment or insurance check payable to the advisor unless it’s for his or her fees.

2.   Don’t place any funds in any investment opportunity that is controlled by the advisor.

3.   Don’t let your advisor place any of your funds in an investment that is not liquid, such as oil, gas, real estate or equipment leasing.

Your Financial Plan for your estate

Although I receive many calls from people who want advice pertaining to investment of money, I have found that they often are not stopping to consider one of the more important aspects of their financial situation - their estate and tax planning. A few percentage points difference of return is not as significant as paying the government unnecessary money. For example if you earn an extra few thousand dollars on a $50,000 investment, but your beneficiaries will be forced to pay the government estate or income tax at your death, what have you really gained?

Sometimes people think that estate planning means losing control over your assets. In fact, estate planning is actually about maintaining control over your assets. If you do not plan your estate, the government will plan it for you. If you take control, your money will be directed the way you want it, and not just to pay more than your or your beneficiaries’ fair share of the interest on the national debt or other governmental programs.

Good estate planning isn’t just for your heirs, although they will thank you for your foresight. It is also for your benefit. You often can pay less income tax, have more income now and pass more to your heirs and or charity with good planning.

One more aspect to keep in mind is that estate planning isn’t just for those whose estate is worth one million dollars or more, but for everyone who wishes to have control over his or her assets.

Next Chapter: Retirement Planning

Financial Concerns for Retirement by Kelly C. Ruggles

©2007, Kelly C. Ruggles | Sitemap | Disclosure | Kelly Ruggles Bio
Kelly C. Ruggles, President of American Reliance Group, Inc., is a registered investment advisor. Mr. Ruggles is the author of "The Financial Playbook" for Retirement.

Mr Ruggles does not intend to provide personalized investment advice through this publication and does not represent that the strategies or services discussed are suitable for any investor. Investors should consult with their financial advisors prior to making any investment decisions.