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Articles: Five steps toward your future path

Is the financial road ahead paved with gold or filled with potholes? Although there are a number of variables, you probably have more control over the eventual outcome than you might think.  Here are five important considerations:

1.  Maximize your retirement plans. Typically, you should plan on replacing at least 75% of your pre-retirement income when you are no longer working. Where will that income come from in retirement?  Most people will have to rely on amounts built up in qualified retirement plans to supplement investment earnings and Social Security benefits.  Generally, contributions to such plans as a 401(k) can grow and compound on a tax-free basis until distributions are made.

In addition, you may benefit from Roth or traditional IRAs, or a combination of the two, to help feather your nest egg.

2. Review your investment mix. Diversification and asset allocation are often the cornerstones of a financial plan. Review your portfolio to see if you have the proper mix of investments appropriate for your stage of life, your tolerance for risk, and your objectives.  Frequently, an investor in his or her middle age will concentrate heavily on the equities markets. Then, as retirement looms, the investor will shift to a more conservative allocation between stocks, bonds and short-term investments to minimize the impact of volatility.

3.  Set your priorities.  It is more than likely that you have to juggle several financial goals at the same time.            For instance, you may be doling out money for a child's college education while you are scrimping and saving for retirement. Establish an order that makes the most sense for your personal situation.   Once you do that, determine if you have remained on track to meet the main objectives and react accordingly.    This may require you to cut down on luxuries or change your lifestyle slightly, but it is generally worthwhile in the long run.

4.  Create a "rainy day" fund.  What would  you  do  if  you  unexpectedly  lost your job or had to deplete your funds for an emergency?  The conventional wisdom is that you should secure enough in the way of assets to sustain your current lifestyle for a period of three to six months.  The idea is to give yourself enough flexibility to cope with unforeseen emergencies without giving up your goals or taking on crushing debt.

5.  Evaluate your insurance needs.  Finally, do not forget about securing sufficient protection to sustain your family through middle age and a lengthy retirement.  This may cover life, health, disability and long-term care insurance. By taking out insurance policies commensurate with your needs, you can avoid a financial disaster at a reasonable cost.

This newsletter/advertisement is produced for our clients, friends and associates through an arrangement with WPI Communications, Inc. for the representatives’ use. Although the editorial content is professionally researched, written and edited, neither our firm nor any of its agents, representatives or associates make any representations regarding the accuracy of the content or its applicability to your situation. The information in this communication is not intended as tax or legal advice. In accordance with IRS Circular 230, the information provided herein may not be relied on for purposes of avoiding any federal tax penalties. Any tax advice contained in the body of this material was not intended or written to be used, and cannot be used, by the recipient for the purpose of 1) avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions, or 2) promoting, marketing or recommending to another party any transaction or matter addressed herein. You are encouraged to seek tax or legal advice from an independent advisor.

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First Minnetonka City Bank
First Minnetonka Investment Center is a registered branch of LaSalle St. Securities, LLC.
Securities are offered through LaSalle St. Securities, LLC., Advisory Services offered through LaSalle St. Investment Advisors, LLC.
 LaSalle St. Investment Advisors, LLC is affiliated with LaSalle St. Securities, LLC.- a registered broker/dealer.
Tam Hubert, CFP® and Kristi Remus are registered representatives of LaSalle St. Securities, LLC.
940 N Industrial Dr., Elmhurst, IL 60126-1131. Member FINRA / SIPC. Not a deposit. Not FDIC insured.
Not insured by any Federal Government agency. Not guaranteed by the bank. May lose value.

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