A Decision Not Made Is Still a Decision
In this vlog, I would like to focus on the decision-making you have regarding your investments and/or finances. For those who put off investment decisions, they should consider the admonition offered by motivational speaker, Brian Tracy. He stated “Almost any decision is better than no decision at all”. This admonition is important to consider when it comes to your investments and financial decisions.
For those who did not take any action with their finances, it often comes with consequences that are not easily recognized which impacts their future financial security. In general, they would not see the impact from not making decisions immediately or ever. However, they could realize the consequences in long term if they truly analyze the decision they made back then.
Now, I would like to give you some examples of what decisions that are being ignored.
- You have access to your employer’s retirement plan and you fail to enroll/participate.
- By not participating in your employer’s retirement plan, you probably miss out your employer matching contributions. Ignoring it causes you to miss out “free money” offered by your employer.
- You choose to not select investments within your retirement plan for the contributions you make. By not picking investments, it would not help you to achieve your vision for retirement in future.
- You decide not to withdraw from your retirement plan such as defined contribution plan which includes 401(k) or Thrift Savings Plan (TSP) or Traditional IRA to satisfy the required minimum distribution (RMD) when you become age 72. If you did not set up your withdrawal plan to satisfy RMD, you will face a penalty. That is something you want to avoid.
- Since you set up an account, you chose investments during that time based on articles they have read or based on the recommendations of a family member and leave it to accumulate for a long time. By doing that, it might not fit your actual needs and objectives regarding your retirement plan or financial plan. So, investment selection should be consistent with your time horizon, risk tolerance, and goals. You should not ignore those but to ensure those do fit your goals.
- By not periodically reviewing your portfolio, financial plan, and overall financial situation, this could cause your progress to not reflect your current investment objectives and financial planning goals. It is better to review periodically.
Now, whatever your situation, your retirement investments require careful attention and may benefit from deliberate, thoughtful decision-making. You should make sure you are making good decisions to fit your needs and achieve your big picture in future. If you do that by getting everything in order and set up a financial plan now, your retired self will be grateful that you did this today instead of missing out or being too late to act.
Now, I would like to let you know that Kramer Wealth Managers do encourage you to have a financial plan and set your objectives to ensure you have a good chance to succeed with your finances. We, here at Kramer Wealth Managers, do offer financial planning services, not just investment management services. You can use both services, or just financial planning services. If you are interested in developing your financial plan, please feel free to contact us about our services.