Did you get a raise this month? You probably did if you are an employee. And there is a good chance you did if you are a business owner. Now the question is, What are you going to do with these extra crumbs? Will you spend them or will you use them to make a feast for the future?
Idea #1…Take care of you. A married person earning $75,000 per year with two children who is paid twice a month just received an extra $56 on the bottom line. That adds up to $1,344 per year. Imagine this same couple saved every penny of that for the next thirty years: at an 8% return, this couple would have approximately $168,000 more for their retirement.
Our advice: pretend you never saw these crumbs and put them toward your future! We have yet to meet anyone who thinks they have more money than they need for retirement.
Idea #2…Stop worrying. Pay for the one thing that keeps you awake at night. Are you worried what would happen to your wife and children if you died or became disabled? Are you worried about running out of money? Are you worried about your kids having to feed you, bathe you and wipe you or spend their life savings paying someone else to do it? Are you worried about your family fighting over your estate after you are gone? Furthermore - what if you your biggest fear came true when you could have avoided it all together?
Our advice: let us help you make a solid plan with the crumbs you didn’t know you had!
Idea #3…Don’t forget where you spent it. If you have all of your planning in order and know you will not need for money in the future, spend it only on things that mean something. Fancy cars, gadgets or clothes are only exciting until the “new” wears off. Spending your money on experiences and other people are investments in memories you will have forever and gifts that give back. A few years ago, we met with a lady who absolutely cherished her granddaughter and her granddaughter’s passion for music. Her hope was that her granddaughter wouldn’t grow out of this. She wanted to set up an account that her granddaughter could use in the future to fund her passion. After talking a bit, we learned she also had a passion for music. Rather than setting up a fund for something that might not even be there in the future, we encouraged her to help her granddaughter grow her passion today. That summer, the two of them traveled to New York and went Broadway, Radio City Music Hall, Carnegie Hall and Juilliard. Her granddaughter’s passion exploded since that trip. Her ambition is to get a music scholarship and eventually teach other young people, spurring that same passion her grandmother ignited in her.
Our advice: think outside the box with your crumbs!
We are a little over one month into tax reform. We have seen crumbs anywhere from a couple thousand dollars to over six figures. This isn’t to say it didn’t take a little planning to find them, but we found them. The best thing you can do in 2018 is to find your crumbs and make a feast for the future!