Spooky Finances: Take a Hard Look at Financial Realities


Are your finances a trick or a treat? It's October, and I can't help but smile thinking about some very scary trick-or-treat moments from my youth. What lurked around the corner? Another yummy snack or a pack of middle-school bullies hooting and hollering with shaving cream (destined for my face) in hand?

I don't know whether I've ever duplicated the speed I achieved that Halloween night; fear can be a powerful motivator.

In the spirit of the season, I'll share a roundup of four scary personal finance stats that may startle you into a course correction of your own.

1. Consumer debt in the U.S. is greater than $14 trillion. If you are like me, your memory of the Great Recession and its across-the-board impact on our economy still sends shivers down your spine. Earlier this year, consumer debt surpassed the accumulated debt Americans carried back in 2008. I don't have a crystal ball, but here's hoping all that debt doesn't trigger another slide. Let a little fear inspire you to map out a path to a debt-free future. And don't be scared to get help. A credit counselor affiliated with the National Foundation for Credit Counseling could provide you the edge you need to get to a better place.

2. More than 80% of Americans have this retirement plan: Keep working. When the Employee Benefit Research Institute surveyed retirees and workers during 2019's annual Retirement Confidence Survey, they disclosed a shocking disconnect: 34% of workers planned to work beyond age 70, but only 6% of retirees actually did. Don't base your retirement plan on false assumptions or use those assumptions to justify avoiding the heavy lifting -- saving, investing and planning -- to prepare you for retirement.

3. Sixty percent of millennials experience financial infidelity. That's according to a 2017 survey from the financial wellness resource CentSai. In other words, they experience things like lying or being lied to about spending, hiding accounts or outright stealing. Obviously, that type of behavior is flat wrong but, on a more functional level, when was the last time you had a frank financial chat with your significant other? Now's the time. I always say, money is a team game. You can't be in the game if you don't know what's going on. And you should, of course, be a good teammate.

4. Only 25% of Americans have a written financial plan. As a financial planner, I find this element of the report (issued as part of Schwab's 2019 Modern Wealth Index) particularly frightening. Sure, I understand not everyone needs a formal written plan, but the same report indicated that fewer than half of respondents had specific financial goals. You don't need to be a financial planner -- or a rocket scientist -- to realize that's off-base. Map out your goals, and build your plan today.

This year, instead of running for the hills like I did when confronted with a scary situation, tackle your financial challenges head on!

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