By Anastasia Megdanis
No matter who you are, where you are from, or what you believe, one thing is for certain, the time to start saving and financially planning was yesterday.
Brien Smith, CFP®, certified financial planner and owner/founder of Traditions Wealth Advisors in College Station took the time to explain why financial planning is so important and how anyone can start to take action in a positive direction.
“Savings is at an all-time low while at the same time, the only fall back for people that don’t save for retirement is social security, and that is also at an all-time low and is predicted to go bankrupt in 10 to 20 years,” says Smith.
Smith explains that there are not enough people contributing to social security as there are receiving its benefits. “The numbers used to be 17 or 18 contributors to social security for every one retiree; now it’s only about two contributors per retiree so the math is not working out at all,” he says.
At Traditions Wealth Advisors, because of Smith’s Certified Financial Planning qualification and the fact that his firm is fee-only and independent, he can offer his clients a wide range of services. Smith is able to advise clients of any net worth, but specializes in high net worth clients, on the best course of action for their financial future.
While services for retirement, estate, investment, business, college, or divorce planning and much more can be offered by a CFP, Smith notes retirement planning as the most popular concern among clients.
“If most people these days don’t have about a million dollars saved up in an account, even with social security on top, it’s going to be very difficult for them not to run out of money,” says Smith. “This is because healthcare is the number one expense and it’s huge, especially later in life.”
Even if such numbers are not realistic for many, the urgency to save and plan your financial future is still there. This is why Smith founded the nonprofit organization, Spirit Stewardship Ministries — to provide financial planning services for free and/or at a discounted rate to those who need it.
Smith emphasizes that it is never too early to start saving. “It seems like, unfortunately, the people that need our help most at the firm don’t come to us, and the people that need our help least have already started saving and are already doing a lot of the right things,” he says. “They come to us to confirm that what they are already doing is the right thing.”
If you start saving as early as possible, you will relieve your future self of stress down the line, because the extra time allows for smaller monthly or yearly savings needed. The younger generation, especially college students who will be entering the job market soon, are advised to start thinking about plans to start saving. Even without a full-time income yet, there are positive steps students can take towards a stable financial future and it starts while they are in school.
Even if you think it is too late or that social security will be enough down the line, there is no harm in being prepared. By saving, you are helping yourself and those around you in a very significant way. It may not seem necessary to some or they may choose to allocate their funds elsewhere, but the best investment someone can make is in themselves. There are many uncertainties in life, but your ability to sustain it should not be one of them.
Three habits you should get into according to Smith
- Try not to get into debt: This is easier said than done, but try your best. Studies show that when people use their credit card, they overspend by 20 percent more than if they weren’t to use it.
- Live within your means: Don’t go into debt in order to try and maintain a certain lifestyle.
- If you have to get a credit card, try to get one with a low interest rate and a low maximum: If you have a low maximum, it will prevent you from burying yourself too deep in debt and keep your credit score up.
