CaseyChang
年龄: 45
注册时间: 2005-03-15
帖子: 4
来自: New York
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Financial dieters make progress
Maybe it was realizing that yes, we need help.
Maybe it was getting a chance to get free financial advice from professionals who usually charge hundreds of dollars for their time.
Maybe it was understanding that public exposure would force them to quit putting off decisions and act.
Whatever the reason, the participants in Financial Diet Challenge have made amazing progress toward reaching their goals, whether it was reducing credit card debt, boosting retirement savings, investing a better way, saving for college or paying off student loan debt. (Mindy's Diet Diary Week 6: Painful, but worth it)
Here's a look at where everyone is at the end of the first phase of the Financial Diet. We'll return in three months to check up on them again.
The Starmers
Putting their money where it needs to be
Jeffrey and Christina Starmer, with Chloe, 9, and Lyman, 22 months, are investing in mutual funds.
Christina and Jeffrey Starmer of Jacksonville started the Financial Diet Challenge amid some fiscal confusion. "You can only watch Suze Orman so much," Christina said at the time.
Now, "We're doing much, much better," she says.
They have followed almost every recommendation of their planner, Kathie Day of The Enrichment Group of Miami. "We're finishing up one life insurance policy, and our will is almost done. We've stopped (investing in) DRIPs and moved around our savings to clear up three credit card bills." DRIPs are dividend reinvestment programs that let you buy individual stocks directly from the companies.
Now, the Starmers are investing in mutual funds, which spread the risk by investing in many stocks and other investments. Their personal finances had gotten entangled with their business, Basket Case to the Rescue, two gift-delivery shops they own in Jacksonville. Now, "We've also set up a separate line-of-credit loan for our business," she says.
And overall?
"We feel at ease."
The McClarrens
Getting a grip on where their money goes
Randy and Jennifer McClarren, with Kelsey, 8, have reallocated Randy’s 401(k) investments.
Randy and Jennifer McClarren of Fort Worth had a lot of financial questions when they started. How could they save for retirement and be able to afford a second baby? How should they save for their daughter's college education? How can they get a handle on where their money goes each month?
"We have a lot of little decisions to make," Randy said at the time.
In the weeks since they met with financial planner Timothy Wyman of the Center for Financial Planning in Southfield, Mich., they have made some of them. They've:
• Opened a 529 plan to save for college expenses for their 8-year-old daughter, Kelsey.
• Opened a Roth IRA for Randy.
• Contributed the maximum amount they can in Roth IRAs for 2004 and 2005 for both Jennifer and Randy. (They made that move before the April 15 income tax deadline.)
• Reallocated Randy's 401(k) investments, particularly by selling some of his company stock, which made up 36% of his retirement plan. Now, his company stock is 7%.
Are they doing everything Wyman advised them to do? "Of course," Randy says. "And we're waiting to do more." Of Wyman's advice, he says, "We got very good general guidelines, and we're looking into things in more depth."
What about doing that bugaboo budget, which has always been a tough exercise for them?
"We're still working on it," he laughs.
The Sharkeys
Saving for retirement over college
The Sharkey family is going to focus on 'socking away more' in their retirement accounts, says dad Greg.
Before the Financial Diet Challenge, Greg and Ginny Sharkey of Granville, Ohio, faced two main issues: saving for retirement and saving for college for their four children, ages 6 to 14.
They were trying to do both equally, and "we just really struggle," Greg said then.
After meeting with planner Andrew Keeler of Everhart Financial Group in Dublin, Ohio, they've begun reassessing their goals.
"It was an eye-opener," Greg says. "As Andy said: 'They don't give scholarships and grants for retirement.' "
The family is going to focus on "socking away more" in their retirement accounts, he says. "I think it's fine for our kids to have some manageable debt when they get out of college. We can help them some, but not for everything."
One of Keeler's key ideas was for the Sharkeys to "hide" some of their savings in an account that was more difficult to access than their savings account at the local bank. They've done that. "We put some money into a money market account with Vanguard," he says. "It'll be a place I can't get to it so easily."
One piece of advice they're not going to take: moving their two youngest children's college money from a 529 plan that invests in Putnam mutual funds to Vanguard funds. That's because the Putnam funds are allocated 85% in stocks, 15% in bonds. The Vanguard funds are more conservative with a higher percentage in bonds.
"Maybe as they get closer to college I'll shift more into bonds," he says. "But my 6-year-old has 12 years before she goes to college, and I want that money to grow."
The real success of the Financial Diet for the Sharkeys, though, was in making them realize that they have to re-evaluate their financial decisions more often — at least once a year.
"I think that, like a lot of people, Ginny and I make decisions, and it's a one-time event. Then we don't look at that decision again," Greg says. "It was very useful to get the advice that you have to look at these things more often, see how it's going."
The Daos
Paying off student debt and buying a house
Vuong and Lori Muscanere Dao have opened a Roth IRA and gotten life insurance and disability insurance.
In April, Vuong and Lori Muscanere Dao of Dallas were married. Vuong found out that his residency after he graduates from medical school Saturday will be in Little Rock. (They'll both be doctors when Lori graduates next year.) They put down money to buy their first home.
But those major life events were nothing compared with the huge financial reality they faced: How to pay back $202,500 in student loan debt. "We just don't know how to start," Vuong said at the time.
Working with planner Shashin Shah of Financial Design Group of Dallas, they've made some key moves to get going with their new lives together. They have:
• Opened a Roth IRA.
• Gotten life insurance and disability insurance. The latter is particularly important for doctors who work with their hands, Shah said.
• Are considering how to set up three accounts for their new family: one for both paychecks to go into, one for household expenses and one for savings, as recommended.
• Met with Shah again to fine-tune plans to pay back their student loan debt.
They've made one decision that their planner was against. They've decided to go ahead and buy a house in Little Rock, even though they're not sure Lori will get her residency at a hospital in that city, too. Planner Shah had urged them to wait. "We felt the benefits outweighed the risks," Vuong said. "It was just too good a deal."
Juanda Smith
Dealing with debt
Juanda Smith is using money she stashed in a Roth IRA to pay a portion of her debt.
Juanda Smith of Atlanta started the Financial Diet Challenge with a wretched credit score and loads of debt she'd racked up in college. She knew she had to do something but didn't know what.
"I want to get this straightened out," she said in mid-April. Now she is.
Juanda has taken advice she got from planner Elizabeth Jetton of Financial Vision Advisors in Atlanta and ratcheted it up a notch.
"I'm taking very aggressive steps in cleaning up my credit," she says. She's using money she stashed in a Roth IRA to pay a big chunk of her debt, and she'll take her tax return money and put almost all of it toward repayments. "I really want to buy a house in the next year, and I realized the interest I was gaining on my IRA wasn't as much as what I owed on my credit cards. So I want to be able to pay off from $5,000 to $7,000 in the next month."
A savings account she set up for emergencies has proven invaluable already, she says. She's been putting about $400 a month into it. And she's added some extra, too, so she's got more than $1,000 now.
"I'm using that to pay off smaller items on my credit report, like $200 here and there." After she brings her more than $50,000 in debt down a bit, she's going to consult a debt counselor to consolidate and get a lower interest rate.
The "emergency" fund has been helpful for fun reasons, too. "I'm going on vacation over Memorial Day, and it's great. I'm not worried about overdrawing my (checking) account because I can use money from my reserve account, and it doesn't affect my cash flow."
It's a lot to stash away each month but "once you're doing it, you don't even miss it," she says.
Her new goal is to raise her credit score dramatically by the end of the year.
"It was so debilitating when I first joined the series," she says of her big credit debt. But the Financial Diet Challenge helped "jump-start me into taking an aggressive approach."
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