Organizing that Financial Junk Drawer

If you have a junk drawer at home like mine, you probably have the typical pens and pencils, sticky notes and paper clips, a few batteries, and maybe some old cell phones. There are probably a few business cards from people you don’t remember, and, if you’re like me, you might even have some old shotgun shells sitting in the back of the drawer.

For many people, this is similar to their financial situation. Especially when it comes to financial planning for pre-retirees, there’s a mix of uncoordinated pieces scattered around in a financial “junk drawer.”


Pre-Retiree? Take a Look in There

So how do you end up with this financial junk drawer and how can you turn that odd assortment into a fine-tuned operation? Over the past 25 years, we’ve done retirement & financial planning for hundreds of pre-retirees. These are usually people in their late 50s and 60s who worked for large companies like FedEx, MLGW, International Paper, AutoZone, DuPont, Kellogg, or maybe the city or county school systems, or even government agencies.

What we find in working with them is that most of them did not inherit their wealth, but they worked very hard over their careers. Many of them put in 40 to 50 hours a week at work, in addition to raising their kids, going back and forth from school and sporting events and being involved with their churches or communities.

Over the years, their lives got so busy taking care of everyone else, that they weren’t able to put that same level of attention into taking care of their own financial situation. They ended up putting their financial lives on “autopilot”.

Most of them have done well financially, and because they were savers, they’ve accumulated a fair amount of financial assets over the years. However, because they were so busy and not able to be intentional, they end up having their finances scattered around this proverbial junk drawer.


What’s in Your Wealth Drawer?

So how does this happen? While working you might accumulate a variety of retirement accounts by contributing to the typical 401(k)s or 403(b)s, IRAs or maybe a Roth IRA. You likely have also paid into a pension or Social Security, and along the way may have purchased stocks and mutual funds, bank accounts, CDs, gold, or some other collectible. Many are fortunate enough to have been given stock options with their company or have deferred compensation plans. Some also have an annuity or a life insurance policy.

Looking further, there are other areas where it might be even less intentional to build wealth in your financial junk drawer. For instance, for many Americans, their largest asset is their home, which was typically paid for through years and years of dedicated mortgage payments, which slowly allowed your home equity to grow. For others you might have purchased some type of life insurance policy and kept making those premium payments, again, accumulating another valuable financial asset.

As you can imagine, over a 30 – 40-year career, you’ve ended up with a lot of financial “stuff,” but it may not be very organized, and you might not be quite sure how all of it fits together.


Time to Get Organized

As you near retirement, it’s time to organize this financial junk drawer. You will now need to rely on these assets and financial instruments to meet your future needs once you no longer are earning income from work. Retirement planning is the process of organizing this financial junk drawer into a simple plan. At the end of the day, these are the assets that need to answer the question: “If I retire, am I going to be okay?”

If this describes your situation, and you are ready to clean out your financial junk drawer, maybe it’s time to sit down with someone who has helped hundreds of others prepare for their retirement years. Someone who can help you get organized, and help you put all the components of your financial life together into a simplified plan to help you determine if you are, in fact, ready to retire.

Your retirement years should allow you to focus on those areas that are most important to you and your family; those areas that truly give your life meaning and purpose.

Let’s get in touch today and put together a plan to help clean out your junk drawer.

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