What Do I Do When . . . ?

Wouldn’t life be easier if this question could be answered at every turn, every bump, and every curve of our lives? This book is intended to provide some of those answers. Or shall we say, at least provide quick action plans in the estate or financial circumstances described in each chapter.

Of course, the law varies from state to state. You are encouraged to discuss this book with your legal and financial advisors. None of the information contained herein is intended to serve as a substitute for legal advice.

Chapter 1

"What do I do when I graduate?"

Congratulations! You have worked hard, played hard, and come to the end of your education tunnel. Into the light you cross, the light being the real world. Now that you are on your way in your professional career, here is your action plan.

ACTION PLAN

1. Sign a Will – You are not too young to have a will. Every adult individual should have one. It can be simple. It is nonetheless crucial.
2. The Executor – In your will, choose an executor whom you trust to administer your estate. Often college graduates will select one of their parents to serve in that capacity. We do suggest naming a successor executor other than your parents, just in case a common tragedy should take both of them from you.
3. Life Insurance – Examine your need for life insurance. Term policies are generally the most economical. Start with any professional group to which you belong for group rates.
4. Beneficiary Choice – For your life insurance policies, employer sponsored retirement plans, and IRA accounts, be sure to list individuals as your primary and secondary beneficiaries. Do not leave these two positions blank or indicate that your estate is the beneficiary. These two selections are the least advantageous from an income tax standpoint.
5. Insure Your Digs – Obtain renter insurance on your dwelling and its contents. Be sure that the coverage is adequate to replace the full value of your contents and valuables. Review the insurance contract as you would any important legal document and understand the exclusions.
6. Be Generous to Yourself –Maximize your contributions to your employer sponsored retirement plan. Learn to live with less income in favor of this action.
7. Full Tort – Be certain to select "full tort" coverage for your automobile. You may wish to consider a higher deductible; however, you should not consider any coverage less than full tort.
8. Credit – Watch Your Step – If you should become overextended in your payment of consumer debt (particularly), do not fail to make a payment in any one-month. If necessary, contact the creditors so they can note in their file that you are making an effort to enter into a payment schedule. Note that you can call and request different due dates for credit cards so that it more closely coincides with your paycheck. If you’re swimming under water in this regard, do your homework in the county in which you reside. Often there are consumer credit counseling services located in the counties that will assist in reducing your monthly payments and consolidating your payments into one monthly obligation. Make every effort not to blemish your credit rating by ignoring obligations.
9. Turn a Decline into a Review – If you are declined for a credit card, review your credit report. Often there are irregularities and mistakes in the credit report that can be corrected by simple correspondence back to the credit rating agency. Keep a close eye on this report, as it will determine your financial qualification in the future.
10. Less is More – Minimize the multiplicity of your major credit cards. Aim at minimizing the total number of credit cards that you have outstanding rather than accepting every offer of credit or applying to several different bank sources.
11. Just Say No – No matter how nicely someone asks you, do not co-sign for a loan. Many a tear has been shed from a co-signer who became financially responsible for a debt never believing that that occurrence would arise.
12. You Are Number One – Regardless of your size of paycheck, pay yourself first. This refers to setting aside an amount per month that will become your forced savings. This habit can expand as you move into higher income brackets and the savings that you set aside can then become capital ready for investment.

Good habits should start early. View yourself as a business in and of yourself. Paying yourself should be the most important lesson that you hold dear. Saving particularly in qualified retirement plans and IRA’s, is not only wise but necessary considering the tenuous future status of social security. The compounding affect of dollars saved early in a career is often referred to as the eighth wonder of the world. We will leave you with this thought: financial and estate planning can be a part of your life no matter what income level you find yourself. You will never be able to recapture the time that is nigh for planning, for saving. It’s your future.