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Have you ever wondered what will happen to your pension if your company goes bankrupt?  It may seem like a distant possibility, which is possibly why you haven’t considered it before. But in 2018, a wide range of companies filed for bankruptcy – including Toys R Us, Sears, David’s Bridal, and others. The truth is that bankruptcy at a corporate level happens, and so it’s best to be prepared in case you’re ever in a situation where you’re at risk of losing your livelihood, benefits, and your retirement savings due to your company going bankrupt.

Pensions are an often-confusing component of your retirement plan. For years, pensions were the gold standard for retirement benefits across industries. However, in recent years, pension plans have largely fallen to the wayside as bigger companies are moving toward exclusively offering 401(k) plans to their employees.     So, if you have a pension available to you, it’s important to make sure you’re taking full advantage of it.  

Do you have big plans for 2019? It seems like this time of year there are about a million of these articles that flood the internet: “Make next year your best yet!” “How to set resolutions you can actually achieve!” “Tackle all of your 2019 goals and crush the New Year!” Unfortunately, a lot of these articles, blog posts, YouTube videos, and podcasts often fall short for a variety of reasons: they’re too specific, they set unrealistic expectations, they don’t give enough detail, or they offer solutions that just aren’t feasible when it comes time to incorporate them into your day-to-day.

I wanted to take time this holiday season to thank you for listening to The Five Minute Financial Plan - have a very Merry Christmas!

Estate planning as an executive isn’t easy. It requires a lot of conversations between family members, and financial professionals. Even if your intentions are good, and you just want to ensure that your spouse, kids, and grandkids get the most out of your hard-earned wealth, it’s possible to slip up and have a large portion of your estate taxed at high rates. So, let's dive into the estate planning basics (and beyond) for executives to help you find your estate-planning-footing!

For most people who have important financial goals and life ambitions, financial planning is essential. Without planning, there is no way to know what it will take to achieve these goals, which means they are not likely to be achieved. A financial plan provides the framework for all important money decisions so your money can be designed towards achieving your goals on time. You would think that the more money you have, the less you have to worry about how much easier it would be fulfilling your dreams. In reality, the opposite is true.

How much money do you need to retire?  It is the single most important question on most people’s minds; yet, because there are so many variables, it is one of the most difficult to answer. Considering that saving for retirement is still a relatively new concept, even us financial planners are still trying to figure things out. For much of the last century, most people simply worked until they died. This century has seen the demise of guaranteed pension plans, which has shifted the burden of saving on the shoulders of individuals. So, the question has to be asked and, realizing that there are many variables that come into play, you need to have an appropriate target to shoot for.

Vacations can help you to visualize the retirement of your dreams. Visiting different locations helps you to zero in on the lifestyle you want: What type of weather do you prefer? Do you want to be near family? Do you want to be somewhere where you can participate in activities you love like hiking or biking year round? Next time you go to plan a family vacation, think about shaking things up and using the time to picture your retirement. Don't just do Disney all the time! 

You’ve done the planning. You’ve crunched the numbers. Recent stock market movements have carried you over the top, assuring you of a worry-free retirement (hopefully!), but you can’t bring yourself to pull the trigger. Did you ever think you would have to be dragged kicking and screaming into retirement? Well, you’re not alone. Welcome to the “new normal” retirement. 

Most of the articles you read about finding a financial planner today discuss whether or not the advisors you’re interviewing are “fee only.” These articles typically come to the same conclusion – the advisors you’re interviewing should be fee-only. As a fee only advisor myself, I couldn’t agree more with this.    Unfortunately, it’s not always easy for consumers to figure out who’s fee only and who isn’t. The financial services industry can be incredibly confusing for advisors who are part of the financial planning profession. Trying to navigate different fee models and understanding what they mean for you as a client can be even more challenging. So, let’s dive into what it means to be fee only, and why I believe it’s the best way to always put my clients first.  

Target date funds are a go-to retirement investment for many 401(k) plans when an employee doesn’t elect where they’d like their funds to be allocated. Some individual investors looking for an easy way to invest according to their retirement timeline use target date funds, as well. Most people want to simplify their retirement savings as much as possible. The more you can automate your investments to align with your desired retirement date and risk tolerance, the better. Although a target date fund may look like the perfect solution to this dilemma on the surface, it’s important to do a little bit of digging before you commit. 

On June 4th, 2018, Illinois’ Governor signed his first budget package since being in office from 2015. For the 2019 fiscal year, many budget changes were introduced – with three heavily impacting Illinois teachers. These changes are in effect until June 30, 2021 when they sunset, allowing them to be amended but not ended completely. $1 billion in Illinois debt has been authorized to fund these payouts, turning the obligation into one of the state as a whole and not specifically to the pension funds. As these changes are voluntary for teachers to act upon, they break no constitutional laws in being introduced and the cost savings of these measures are based upon how many teachers will elect to act on these provisions.

Leaving a job, for any reason, is a major life event. If you are also leaving a pension, the decision as to what to do with it can have lifelong consequences. The choice of accepting the pension benefit of a guaranteed lifetime income, or cash it out now in the form of a lump sum of cash is not as clear cut as you might think. There are several key factors to carefully consider that should tip the scales one way or the other.

Making partner is a dream for many executives. This journey comes with a lot of varied emotions - you're excited, nervous, and you're not entirely sure what to expect. Often, taking a step back to look at the financial implications of becoming partner falls to the wayside when you're making this big career decision. Let's go over a few factors that can help to determine whether making the leap to "partner" is the right decision for you.  

As an executive, a key element to your financial planning is income tax planning. Your end goal should always be to keep as much of your money as possible, which might mean implementing advanced income tax strategies in your financial plan. Ready to learn more? Let's dive in!

Many executives at the Director level have multiple stock plans as part of their compensation. While this seems fantastic at first glance, it can complicate your retirement plan in the long-run – and make it harder for you to create a flexible strategy that helps you meet your goals. So, what do you do when you have multiple employer-stock plans? What's the best way to leverage them in your financial plan? Tune in to find out!

The current maximum for 401(k) contributions is $18,500 each year if you're under age 50, and $24,500 a year if you’re 50 or older. However, there is a hidden risk with aggressively saving to your 401(k) - you could potentially max it out too early. Maxing out your 401(k) mid-way through the year comes with a variety of drawbacks including: Missing out on your employer's matching contribution programs Stopping contributions for half the year because you feel you've hit your "goal" for annual retirement savings  In this week's episode, we'll cover the dangers of maxing out your 401(k) halfway through the year, and what you can do if you've hit that point in your retirement savings.

Have you taken care of your estate planning? According to the AARP, 60% of people haven't started the estate planning process.  Today we're going over three key tips to remember when you're getting ready to set up an estate plan. 

Do you pay attention to your 401(k)?  Today's podcast is covering five ways you might screw up your 401(k)  - and how to fix it.  You don't want to miss this!

Electing to receive Social Security benefits can get tricky, especially if you want to examine if you should collect on your own record or part of your spouses. In this podcast, we explore the three top rules for collecting spousal Social Security benefits.