Five Tips for Your Better Financial Future

What is the sign of a good decision?

It’s assessing and then addressing what is most important to your family and its financial future.

If you are like many Americans, the recent economic downturn has thrown your family budget for a loop. Many have readjusted their spending habits to such an extent that there is now a new normal. For example, they no longer shop as much as or where they used to; they may indulge in a staycation, rather than a true getaway; and items that were previously considered to be necessities have been relegated to the “can’t afford” or “not needed” category.

If you think these are temporary changes, think again. Many economic analysts feel that these new attitudes are here to stay.

Your personal economy

You probably know someone who has been laid off or personally impacted by these challenging economic times. And even if you have been fortunate enough to remain employed, you may have been affected by the fallout from declining retirement plan balances. And, similar to the changing financial attitudes that resulted from Great Depression, the difficult times resulting from what

many now call the Great Recession have forced many families to take a step back and take a long, hard look at their finances—and where they want to be financially in the future.

Tips to help improve your economic future

Here are some tips to help you take stock of your overall economic picture, with actionable steps designed to help improve your long-term financial security.

Tip #1: Determine what is really important.

Take stock of what is really important to you and your family—is the newest electronic game system or cell phone more important than creating a secure financial future?

Start by developing your family’s mission statement. This is easier than it sounds: Simply write out what is important to you as a group. Be sure to include what your long- and short-term goals are, and what you are willing to give up in order to make those goals a reality. Don’t forget that along the way, you may still want to decide what little luxuries your entire family can enjoy (like a

video game system) that you want to keep in your budget – since these can help you feel lessdeprived and even save you money (by keeping you from going out to first-run movies, for example).

Tip #2: Cut back, even if it hurts (a little).

Figuring out what is most important to your family from a financial perspective is a smart move – and a good decision for your long-term financial security. Making even small sacrifices in your spending can help you meet your goals. Look carefully at how you and your family members spend your money so you can identify where you can make small changes to cut back on nonessential

expenditures. And don’t overlook the bigger-ticket items you pay for every month, such as your cable TV/Internet subscriptions and car insurance. Making minor adjustments to these items can free up more dollars than you might imagine, and play a significant role in helping you fund your family’s long-term financial goals.

Tip #3: Become a dedicated saver.

If you are like many families, trying to juggle financial priorities can make saving extremely difficult in tough economic times.

Successful savers use the concept of paying themselves first whenever they receive a paycheck. Over time, adopting that one smart move can help you reach your financial goal of saving for a car, a vacation, or whatever is a priority for your family. It’s the sign of a good long-term decision.

To help make it easier, check with your employer to see if you can have part of your pay automatically deposited into one or more savings accounts. It can make saving automatic—and nearly painless.

Tip #4: Run your numbers.

Do you know if you are on track with your current disability coverage, life insurance, and retirement savings plan(s)? In other words, will these important items provide you and your family with the amount of financial protection you’ll need – when needed? Don’t wait until it’s too late. Take a checkpoint now to assess their adequacy and make the appropriate adjustments.

Taking the right steps today can help to ensure a better financial future for both you and your loved ones.

Tip #5: Get the help you need.

When it comes to Tips 1 through 4, you may feel you need some assistance. Whether you need help in just one area or all four, start looking at your future through a new lens – one that has your family’s financial goals in focus, with a plan to help you get there. Contact a financial professional to discuss ways they can help you put these tips into action—and your financial dreams on track.

© 2010 Massachusetts Mutual Life Insurance Company, Springfield, MA

Provided by Laurence Dresner, ChFC, ATP, a financial representative with The Greco Planning Group, which represents MassMutual and other companies; courtesy of Massachusetts Mutual Life Insurance Company (MassMutual)

Authored by: Laurence Dresner

Laurence Dresner is a Chartered Financial Consultant (ChFC), a designation conferred on individuals who have passed a rigorous series of comprehensive tests and maintain annual continuing education requirements. He's been a financial planner for over fifteen years. Mr. Dresner is also an author, columnist, and public speaker. His book is titled Personal Finance for Clergy. He has written articles that have appeared in Financial Planning Magazine (“Ministering to the Clergy”, Dec 2005), the Journal of Practical Estate Planning (June 2006), local newspapers, and web sites. The Electronic Accountant interviewed him for an article (Nov. 2001) about practitioners specializing in serving clergy titled “Clients of the Cloth”. His newsletter “Your Financial Advisor” is distributed to over 4,000 readers. Mr. Dresner has given seminars at the Academy for Jewish Religion and the Jewish Theological Seminary as well as teaching adult education courses. He has served as a board member on his temple's Executive Committee, Board of Trustees and was the investment manager for his temple's endowment fund. Mr. Dresner is a member of Toastmasters International and several financial industry organizations including the Financial Planning Association (FPA) and National Association of Tax Professionals (NATP).

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