Time to Smell the Roses

Many years of work, planning, and saving have led us to be in a place where we can settle and enjoy life to its fullest.  It’s taking a little time to realize that we have arrived at a long-term destination.  For so long, we focused intently on the next steps - leaving our corporate jobs, moving to Chicago, and then finding a home the Southwest.  Oddly, now that we have achieved our goals, it’s a little disorienting.

You know that feeling you get after a long road trip, when even after you get to your destination and get out of the car, it seems as though you are still moving?  I feel a bit like that right now. 

The current plan is to live in our community in Prescott for as long as we are able.  We love the area and our home and friends, and have plenty to see and do.  Other than enjoying all that, we don’t really know what’s next.  That’s mildly disconcerting for someone like me, who is a planner.

Eventually we’ll need to have discussions about how to prepare for a point in life where we need assistance.  As we and the huge population of Boomer compatriots age, there will likely be more and more options for appealing situations for our sunset years.  I know we have to figure that out; but not right now.

Right now, we will smell the roses, nurture our health, take care of each other, laugh with friends, breathe deeply of the high desert air, explore our interests, connect with others, and stay active.  We’ll know when it’s time to start planning again.

Managing a Financial Windfall

When substantial, unanticipated money comes your way it can create a once-in-a-lifetime opportunity for you to re-chart the path of your life. Depending on the amount and on your age there are a number of good choices possible, and a few pitfalls you should avoid.

When I was 27 years old and living from paycheck to paycheck, I inherited some money from my Aunt Katee. It wasn’t a huge sum, but it was enough to change my life for the better. I paid off my credit cards and car loan, put a down payment on a townhouse, and bought some furniture. Admittedly, I also splurged a little by going on a cruise with a girlfriend (my first non-family-centric vacation ever). In hindsight, I feel good about all of my decisions. What I feel best about is that I know exactly where the money went – I didn’t just piss it away little by little on frivolous purchases.

Looking back, I would give this advice to young adults who come into a financial windfall:

PAY OFF TOXIC DEBT - NOW
First, pay off any credit cards, or high interest loans like car loans. Resolve not to accrue any more toxic debt if it can be avoided. Put your credit cards away somewhere safe, and use them sparingly and wisely. Cancel department store cards and cut them up.

WRITE DOWN YOUR LIFE GOALS
Spend some time thinking about what you want out of life. Money can’t buy love or happiness, but it can help you attain other goals. Do you want to own a home, start a business, live abroad, share your life with someone, and/or have a family? Be sure decisions you make with your money support your life goals. Understand that your goals may change over time. This is fine; but keep thinking and talking about them.

CREATE A BUDGET
Do you know where your money goes today? Get a handle on it, before you start spending your newly-acquired funds. Determine whether you want or need to revise your budget going forward.

TAKE TIME TO MAKE DECISIONS
You may get plenty of unsolicited advice (and requests) from family and friends. Don’t make major decisions too quickly. This is your money and your life at stake. The money can sit in the bank for a while you think it over and get advice.

INVEST IN YOUR EDUCATION
Nothing will enhance your quality of life long-term like a good education. If you don’t already have your college degree – invest some money toward that goal. There is nothing that can replace having a positive college experience, or that credential on your resume. Aside from what you learn, you will meet smart people who will become influential friends for life, and part of your supportive network. Do not miss this opportunity.

PROTECT YOURSELF
Be sure you are properly insured. You need health insurance, comprehensive automobile and property insurance (including liability coverage). If you’ve been relying on your parents for coverage, it’s time to make the leap to independence. Open an Individual Retirement Account (IRA). You may think it’s too early to plan for retirement, but it’s not.

RETAIN SOME CASH

No matter what you decide to do, you will want to retain a portion of your windfall in liquid cash reserves. Unexpected things happen, and sometimes you need immediate cash that is not tied up in investments.

INVEST WISELY

You will need some advice if you have money to invest. There are a confusing variety of options available. Ask an experienced, trusted friend or relative to recommend a financial advisor.

INDULGE YOURSELF A LITTLE

It’s OK to give yourself a little treat in celebration, but it should be something memorable and lasting – not a budget-busting trip to the mall. Set an amount aside for your planned indulgence and stick with it. Your long-term goals are more important.

A windfall can have a life-changing impact if properly managed. This is your money and your life at stake. Make good decisions and reap a lifetime of rewards.

Ready for 2010

I’m not big on New Year’s Resolutions, per se. But we do like to talk about our plans for the coming year, and set some broad goals. Otherwise, the years just zip by, while we are left saying, “I meant to…” and “Maybe next year we’ll…”. The older we get, the more diligent we need to be at making the most of time and opportunity.

For me, 2009 was a year for reconnecting with friends. I joined Facebook, which turned out to be an unexpected delight. Technology has truly enabled a social revolution. With friends spread all over, our contact is no longer limited to the occasional email or the annual Christmas card. LinkedIn has also provided some surprises, by helping me expand my professional network and resulting in stimulating new contacts and a little bit of consulting work. Of course, reconnecting wasn’t all done online. We made a point of having family here to visit, and traveled to visit friends and family too. It’s been a treat to have the time to do it.

Our other 2009 goal was to focus on continuing to improve our health. We have stuck to our low-carb lifestyle (with only occasional lapses), allowing us to maintain last year’s weight loss. The Man Cave has been outfitted as a retreat and workout room; and the elliptical has been an important part of our workout routines (especially in the cold weather). We visited the doctor and dentist to take care of things, and found health care plans for our post-COBRA life. Lots of progress made.

Tonight – New Year’s Eve – Ron and I will spend part of the evening talking about plans for 2010. My thoughts, going into that conversation, are revolving around a few ideas. I want to pursue another level of fitness; losing another 15 stubborn pounds. There are a few final home decorating projects I would like to complete, including a tile backsplash in the kitchen, and a paint job in the master bath. Finally, although we’ve already been in Chicago for a year and a half, we have a long list of things to do and places to see to fully explore the city.

I’m looking forward to tonight, when we’ll review 2009 and (loosely) plan 2010. New Year’s Eve is a time for nostalgia and excitement about the future. Embrace the opportunity full on.