When money comes your way, what do you do with it? When you get good news, how do you respond financially? Here are 10 examples of positive events that could shake your financial life.
Everyone has heard of the rainy day fund, correct? It’s that money you are supposed to put away for when something unpleasant happens, like the loss of a job, or something significant in your life breaking down, like a car or your home.
But sometimes people experience events that are financially positive, and those moments need to be treated with the proper respect by doing what you can to make your new landfall last a while.
The staff at U.S. News and World Report suggested 10 moves an investor should make to take advantage of the new largesse hard work or fate has provided. Here are 10 moments when a financial advisor might be able to provide the guidance necessary to make the best of a great situation:
1. Buying a Vacation Home – The perfect storm of events – an influx of funds, a buyer looking to sell, a location you have visited in the past – sets you up to own a summer home. But it is no different from owning your principal residence and can be more complicated if you plan to rent it out when not using it. A financial planner can make more sense of the particulars than a rental agent could.
2. That big raise finally came – It’s raining money at your place today, and you want to know what to do with it. Some of that new income should go to savings, and a financial advisor can suggest how best to accomplish that.
3. Going to the chapel – There is a wedding brewing and two portfolios are about to be joined in some way. Financial responsibilities for children and for each other must be considered, while some thought must be given if one spouse is better off financially than the other.
4. Graduation – It’s a good thing, really, that you or someone in the family is ready to leave college. But leaving college means those student loan payments begin, and there has to be some planning done to make sure those payments are met.
5. The big move – Americans are not moving to new jobs as much as they used to, but some still do it. Whether there is a promotion involved or not, the financial situation changes depending on where you move to. Is the new location more expensive or less expensive a place to live?
6. Inheritance – It’s the most unfortunate of windfalls, because someone important has passed away. If it is a significant inheritance, a financial advisor can help figure out what to do with it.
7. The next generation – The first child, or perhaps the next child, is coming along. Congratulations! Now figure out how you are going to take care of that child down the road.
8. The first job – That cute kid you had 20 years ago has gotten a job out of college, or perhaps he or she waited a bit longer to get that first paying gig. Set them up on a date with your advisor to talk about the very beginning of adult financial planning.
9. The buyout – You’ve reached that stage where your employer is offering you a severance package. That is a one-time payment with huge considerations for your future, whether you are going to get another job or not.
10. Retirement – Hopefully, you have given this moment thought prior to it taking place. Either way, financial considerations abound in what will set you up for the rest of your life.
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.