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Despite the fact David Letterman now looks like Santa Claus and sounds like Oprah, his Top 10 lists live on. Here are my Top 9 reasons – I don’t believe in extra if it’s not needed - why people procrastinate about planning for their financial futures. I’m sometimes asked who our strongest competition is and I always answer, “People’s own inertia.” Meaning, it can take energy to start anything new. But, it can be more nuanced than that. Here’s what I’ve seen:

It’s been said that investing in the stock market is like riding up an escalator while playing with a yo-yo: just because the yo-yo goes up and down doesn’t prevent it from eventually reaching the next level. But, what if we could get to that next level a little faster by shortening the yo-yo’s string?

F. Scott Fitzgerald said, “The rich…they are different from you and me.” Recent research published by the National Bureau of Economic Research (NBER) proves he was right, albeit not in the way he believed. Their study found that investors with larger holdings earned relatively lower peak returns, but they earned them consistently, with less up and down. In other words, they take less risk and know that winning in down markets is more important than winning in up markets. Let’s take a look at why this is the case and some guidance on how to accomplish it:

Back in the late 1960’s the Stanford psychologist, Walter Mischel, studied delayed gratification by placing a marshmallow before a child and offering them a choice: eat the marshmallow now or, if they wait a few minutes, get 2 marshmallows later. The original study found that children who were able to wait longer for their reward tended to have better life outcomes – educational attainment, better health statistics, etc. Suffer now, enjoy later. As a side note, although I am definitely a saver by nature, I wouldn’t wait 2 seconds to eat something chocolate placed before me.  

There is a common narrative that savers will eventually reap great rewards by delaying gratification, but only after suffering first. In financial terms, one can eat their marshmallow only when they retire or reach financial freedom, but must drool until then.

There is, of course, a different way to view saving and accumulating wealth. I recently came across an advertisement from 1969 by the First Federal Savings and Loan Association of St. Petersburg. Florida, not Russia. I think it captures quite well the satisfaction and peace of mind one can enjoy NOW by saving and accumulating wealth. (I haven’t edited it, so replace their use of “man” with “person” in your mind while reading)

The transition from working and saving to retirement and withdrawing can be stressful if you’re not ready for it. Consider this: If you are fortunate enough to live to age 65, your life expectancy is about age 85. If you’re married, there’s a 45% chance one of you lives to 90. So, how do you generate income over the next 20-30 years while ensuring you don’t outlive your assets? Here are four tips:

It is far from uncommon for faculty to get a late start on their retirement saving. A Master’s program followed by a Doctoral program followed by a long and daunting dissertation process and then, maybe, even a post-doc somewhere. Finally, when you get that first teaching gig then the real work starts, right? The long and challenging process to earn tenure when the hours are long and the pay is not. As a result, when other 35-40 year-olds already have 10-15 years of saving for retirement under their belts, a university professor may only have a handful.

So, fast forward to 50 or 60, ages when we naturally start to think about retirement. Are you on track for retirement? Have you saved enough to sustain your current lifestyle through retirement? If not, what can be done now?

A woman stole my Social Security number but got bupkes for her trouble because I had frozen my credit. When I received a phone call from a Lexington Police detective a couple weeks ago telling me they were questioning someone who had obtained my Social Security number, along with several others, I told him I had frozen my credit and he immediately said, “You have nothing to worry about.” While it was disturbing to hear that someone could somehow steal my number, I have to say it was also quite satisfying to know I had shut her down faster than a church picnic with no potato salad.

A new federal law that goes into effect today, September 21, makes freezing your credit, thawing your credit and protecting the credit of your underage children easier and less expensive. Here are some steps to take to protect you and your family from identity theft: