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Father's Know Best

| June 15, 2020

By Kristi DeRycke, Registered Assistant

Everything we know about financial independence we learned from our father's.

  • "Anything worth doing, is worth doing well." This drove me crazy when I had to spend my Christmas vacation on a toothpick bridge for physics Olympics. Dad was a foreman for a bridge building construction crew and helped me do the project, but believe me it had to be done well. We need to work very hard at whatever job we find ourselves in. This will help us to get better pay and advance.

  • "You can do anything you put your mind to." We often are our own worst enemy. We talk ourselves out of trying to do better. We let the voice in our head convince us not to shoot for the moon.

  • "A penny saves is a penny earned."This one speaks for itself. We really have two choices if we want to be better off financially and makes ends meet. We can either make more or spend less.

  • "Take out the garbage." Sometime we have garbage. We may be in a house where the payments are too high for what we can really afford. The banks will often say that you can take out more in a mortgage than you can truly pay for comfortably. Maybe it is an investment that has not been doing well that you need to cut your losses and sell.

  • "Mow the Lawn." Mowing the lawn is one of the most boring and tedious jobs there is. It is just back and forth, back and forth until it is down. It also needs to be redone every few days. Very mundane. Saving and investing for our futures is much the same. The get rich quick ideas rarely work. The traditional budget or save a percent of every paycheck, invest regularly through your paycheck and consistently increase contributions over time is much like mowing. Very boring! But guess what. Doing the right thing consistently over time will get you where you need to be.

  • "If you fall, get back up. Be tough."We will all have set-backs in life including financial set-backs. The important thing is to get back up and set things in order.

  • "The early bird gets the worm."The rule of 72 states that any money that we invest will double every 5 to 20 years depending on how aggressive we invest it. If you start investing for your retirement more aggressively early, it will be a chance to double possibly x 5 if it averages 7% annually. That means $10,000 could hypothetically be worth $320,000. However, if you wait until it only has a chance to double x 1 before retirement it would be $20,000. Big difference!*

  • "Check the oil." Take time once a year to check into your finances. Review your investments. We need to take the time to review our finances. Do we have 3 to 6 months in living expenses set aside? Are we paying low fees or are we in expensive funds? Is our blend of stocks, bonds, EFTs, etc. where we think they should be?

  • "If all else fails, read the directions." We need to read resources on finance to know how to put our money to work. Or we need to...

  • "Share the ball."If we are not in a position to make decisions with our finances due to lack of knowledge or lack of interest in doing our own research, we should align ourselves with a financial advisor as a teammate. The important thing is really winning the game and being able to retire as you want, not how we got there.

Happy Father's Day to all of the fathers, step-fathers, adoptive fathers, foster fathers and those that guide other's without an official title!

By Greg Johnson

Happy Father's Day to all the dads in the world! A special shout-out to my father who has been a tremendous influence in my life. I love you and I'm so happy for the time we get to share with each other. Many lessons have been shared over the years by all of our fathers and we may not always have the opportunities to thank them as often as we should, but please take some time this weekend to reflect on the lessons you have learned and give your fathers some love. They deserve it.

*The Rule of 72 does not guarantee investment results or functions as a predictor of how your investment will perform. It is simply an approximation of the impact a targeted rate of return would have. Investments are subject to fluctuating returns and there can never be a guarantee that any investment will double in value.