Emotional financial planning

The Index Card

The Index Card by Helaine Olen and Harold Pollack gives solid advice to people who worry about their financial life but have very little time and money to spend on it. That’s pretty much everyone I know.

This little book talks about how to right your financial ship without handing over a fortune in fees to people who already have enough money i.e. financial planners who sell financial products that eat up your profits by charging high fees.

Okay, here are the notes I took as I read the book. I have zero creative ability right now. It’s 11:48PM on Sunday, December 30th and I am stumbling my way out of this year with a cold that I think is trying to kill me. I need to go have a drink and go to bed early.

  • I can save 15% of my income by setting up an auto transfer from checking to savings every time I get paid
  • I can create a spending plan by becoming familiar with what my set expenses are, like rent, car insurance, etc.
  • I can keep track of all my other spending by writing down everything I spend for 3 months then take an average of each category, groceries, target, etc.
  • I can set up an emergency fund by using information I gather from keeping track of my expenses to shrink what I spend
  • I can create a flexible spending plan by going over my monthly bills with a fine tooth comb (the kind used to get lice out of your hair) and seeing where I can save money
  • I can get a clear idea of where I am spending my money by tracking where, when and how I spend my money #spreadsheet
  • I can be a good financial steward by paying off my credit card bill every month, thereby avoiding paying high interest rates
  • I can set up a Roth IRA by figuring out what the hell it is first
  • I can set up a Roth IRA without worrying it will negatively impact paying for Six’s college
  • Don’t buy individual stocks!
  • I can invest in inexpensive, well-diversified indexed mutual funds and exchange-traded funds (once I figure out what they are)
  • I can buy life insurance since I don’t have any as long as it is term
  • I can buy a home when pigs fly since by the time I get all this in order I will be 108 years old
  • I can support the social safety net since 98% of Americans have used some form of it at least once in their lives
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