It’s easy to put off thinking about retirement when you’re young and life is good, but like most things, the sooner you start the better off you will be. There are many different aspects of retirement, because of emotions and lifestyle choices, no two plans will be the same. Every individual will have different needs and wants for their retirement years. You will need to determine your retirement goals, and then structure your plan around those using different financial strategies for saving, investing, and (once you retire) distributing your money.

You will need to identify sources of future income and start transferring money to those accounts. One of the easiest ways to kick start your retirement plan is to participate in any employer sponsored retirement programs like a 401k.

The timeline for retirement planning starts as early as your first job or your first saved or invested dollar. Young adults at the beginning of their careers typically don’t have as much money to invest, but with time on their side, they only need to invest a small amount to amass a large amount of money. When compared to someone even ten years older, that person would need to invest nearly three times the amount. This is where compounding shines.

By your mid thirties you may have more money coming in, but there's usually more money going out as well as families and responsibilities grow. This is a pivotal time to be a little more aggressive in putting money into your retirement accounts. Again, the interest and growth on these assets will begin to provide more security once you retire.

By your fifties you should be trying to max out your contributions to your 401k or IRA. Towards the end of your career you will want to focus on being more conservative with your investments. You should also assess what your Social Security benefits will be, and begin learning about those benefits, including how and when to access them.

Retirement planning is an ongoing effort. As life changes, flexibility is key, pivoting when needed. Remember that these retirement years are the “golden years.” Plan accordingly so you can enjoy them.

We’d love to answer your financial questions, I know what y’all are thinking- its just a silly or dumb question. We’ve all said that before, right? I really cannot remember the last time someone asked a truly “dumb question,” even though that is what they said just before asking their question! . Send your question(s) anyway here: questions@yieldfa.com and we’ll respectfully answer them in a post!

“There is only one success - to be able to spend your life in your own way.”

-Christopher Morely pg.129 The Maxims of Wall Street by Mark Skousen

Have you ever gotten to the end of the month and wondered where all your money has gone?

One of the primary steps to becoming financially secure is to gain an understanding of your cash flow and set yourself a budget. To begin you should understand where you stand now and visualize where you want to be financially in the future. There’s no point in setting out on a journey if you don’t know where you're going. Creating a cash flow budget is not always easy, it can take some time, but if you take it step by step you’ll be able to create a functional budget and use it as a road map to your financial goals.

The first step you need to take is to calculate all your money coming in. Then tally up all the money that you spend. These two numbers will give you your net cash flow.

Total Income - Total Expenses = Net Cash Flow

Ideally, you need to have a positive cash flow. This means there is money left over to be saved, invested, or can even be used to treat yourself. If you end up with a negative cash flow, it’s an indication that you are living beyond your means and are incurring debt. This is a dangerous place to be, and can be difficult to free yourself from if the negative cash flow continues. The only way to get out is to assess your spending habits and make proper adjustments.

Cash flow management really comes down to understanding the different components that make up your financial picture and acting accordingly. Once your cash flow has been established you can turn that information into a budget. This next part is easiest if you categorize your spending. Start by identifying your components of income-things like your paycheck or investment sources.

Then list the components of your spending; there are different categories of spending that will help you to determine all of your expenses.

• Fixed and periodic expenses are things you must pay each month like your rent/mortgage, loan payments, recurring bills, and payments like utilities, cell phones, or memberships.

• Variable, or discretionary expenses are the things we have more control over like groceries, eating out, retail/online shopping, vacations, etc.

The final component of your budget is savings. The better you are at managing the other categories, the more money you will have to save. Money saved and invested allows you to grow your money, which results in more financial security.

Designate the amount needed to cover each category, and stick to it. By cutting back on discretionary spending you can turn your financial course around. If you have a negative cash flow this is where you will really start to see a difference.

Maintaining a budget will help you when making financial decisions and gives you set parameters to live within. It’s a good idea to revisit and assess your budget at least quarterly. This allows you to stay on track and make course corrections when needed. Remember, budgeting is an ongoing, active process.

When in doubt don’t hesitate to ask for help with your finances. It’s always better to be certain that you understand than to have a mistake snowball into a larger problem. If you have financial questions we’d love to hear them. Send your questions to questions@yieldfa.com and we will write up a post to answer them!

“It’s not what you buy. It’s how much you pay for it.”

-Carl Icahn pg.36 The Maxims of Wall Street by Mark Skousen