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How to Review Your Finances

A 9-minute checkup to see where you stand and get your finances squared away. BUCKNELL MOCKUP

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Check the 3 Dimensions of Financial Health

Then Get Your Finances Squared Away

  • Manage Everyday Money
    • Making Ends Meet & Establishing Emergency Funds
  • Protect Your Family
    • Medical, Life, & Disability Insurance
  • Build a Better Tomorrow
    • Retirement, College, & Housing

Get rule-of-thumb estimates for what you need to be OK, then decide you’re “OK,” “Not Sure,” or ”Not OK.”

Get an overview showing where you’re “OK,” “Not Sure,” or ”Not OK.”

Then check out those areas where you’re “Not Sure” and square away those areas where you’re “Not OK.”

header-marker Basic Information We Need  
header-orange To Estimate What You Need    
header-small Change the items below to match your situation.   
input results-small Marital status
  
header-column  You  
input results-small Age  
input results-small Annual income  
total Monthly Household Income  
header-marker Managing Everyday Money    
header-orange * Making Ends Meet    
header-small Do you have trouble paying your bills?    
text Paying interest on credit card debt, with payments taking 4% or more of your income, is a tell-tale sign of trouble.     
text You're also vulnerable if you have high fixed expenses.  For example, banks won't give you a mortgage if the fixed expenses below take more than 45% of your income.   
text For for a QUICK ESTIMATE, change the items below to match your situation.   
header-small Monthly fixed expenses  % of pay  
input results-small Credit card debt  
input results-small Mortgage or rent    
input results-small Real estate taxes & insurance    
input results-small Other debt    
input results-small Child support, alimony   
total Total   
input results-small Do you need help making ends meet? 
  
gap     
header-orange * Establishing Emergency Funds  
header-small Can You Weather a Financial Shock?  
text Most households need 2-4 month's pay to weather a spell of unemployment, the most common financial shock.  Based on your income, a QUICK ESTIMATE of the funds you'd need is  
total Emergency Funds Needed  
text You would need MORE 1) in a sharp economic downturn; 2) if you have high fixed expenses; or 3) you don't have good health insurance.   
input results-small Do you have enough emergency funds? 
  
header-marker Protect Your Family  
header-orange * Medical Insurance  
header-small We all need medical insurance to protect against big medical bills.  
text Bucknell provides different types of plans – a PPO, a High Deductible plan, and two HMOs – and all provide protection against big medical bills.  They differ in coverage, cost, and your ability to choose providers.   
text When you choose a plan, consider   
text 1) What you’ll get: having the providers and access you need.  
text 2) What you’ll likely pay and COULD pay: considering the coverage, deductibles, and co-pays, as well as the monthly premium.  
text 3) Whether the plan is the best value, for what you’ll likely pay and COULD pay.  
input results-small Do you have the right medical plan? 
  
gap     
header-orange * Life Insurance  
header-small You don't need life insurance if you don't have dependents.   
text But if you do, the younger they are, the more they need.  Based on your income and age, a QUICK ESTIMATE of the amount insurance you need is  
text Bucknell provides a life insurance benefit equal to your annual base salary, up to $50,000, for faculty and staff aged 64 or younger.  Based on your income and age, a QUICK ESTIMATE of the amount insurance you need is  
header-column  You  
total Insurance Needed on  
text  
text You need LESS if 1) your survivors will earn more; 2) use insurance to pay off debts or meet saving objectives; or 3) you have retirement savings they will inherit.    
text You need MORE if your family will need to pay for additional services or help.   
input results-small Do you have the right life insurance? 
  
gap     
header-orange * Disability Insurance   
header-small Social Security provides basic benefits should you become disabled.  
text Bucknell provides additional insurance to employees with at least one year of service, which pays up to 60% of covered salary, up to $xx,000 a year, inclusive of Social Security disability benefits, after six months of total disability.  The university also offers additional disability insurance you could purchase. An estimate of the additional coverage you need to maintain your standard of living is:  
header-column   
total Coverage Needed on  
input results-small Do you have enough disability insurance? 
  
header-marker Build a Better Tomorrow  
header-orange * Retirement  
header-small The average worker needs to save about 10% of pay each year.   
text The Bucknell contributes 10% of base salary into your account in the University’s retirement plan and requires faculty and administrative staff to contribute an additional 6%.  So a lifetime Bucknell employee should be pretty well set.    
text  
text  
header-column   
input results-small Retirement Savings   
total % of Pay to Save for Retirement  
text  
text You need to save LESS than the % indicated if you will 1) retire later; 2) save more later; 3) downsize when you retire; or 4) get an employer pension.  
text You need to save MORE if 1) you will retire earlier; 2) if investment returns are less than expected; or 3) if Social Security benefits are cut.  
input results-small Are you saving enough for retirement? 
  
gap     
header-orange * Paying for College  
header-small The cost of college typically needs to be spread over many years.    
text At Bucknell, however, …. I NEED HELP PRESENTING BUCKNELL'S TUITION BENEFITS; AND HOW TO ESTIMATE HOW MUCH, IF ANYTHING, THE EE MIGHT NEED TO SAVE.   
text For a QUICK ESTIMATE of how much you need to save each month until they graduate, change the items below to match your situation.  
input results-small How many kids  
input results-small The oldest is   
input results-small Will attend
  
total Monthly Saving for College  
text  
text You need to save LESS if 1) you already have money saved for college; 2) you will save more later or take out loans you'll repay after the kids graduate; or 3) your kids will be eligible for need-based grants, win scholarships, pay part of the cost, or live at home.   
input results-small Are you saving enough for college?
  
gap    
header-orange * Housing   
header-small Housing is typically your largest expense.  
text So nothing changes your finances like a change in housing.     
text For a QUICK ESTIMATE of your housing costs, change the items below to match your situation (the first 2 items are copied from above)  
header-column  monthly expense  
input results-small  
input results-small Taxes & insurance   
input results-small Heat/Hot Water  
input results-small Electic  
input results-small Water/Sewer  
input results-small Upkeep  
total Monthly housing costs  
total % of monthly income  
text To strengthen your finances, is downsizing or a new mortgage the answer?    
text If you you're planning to upsize, can you can afford it?  
input results-small Is your housing right?
  
gap     
header-small THAT'S IT!    
header-marker Checkup Results  
header-orange See Where You Stand  
header-small Everyday Money  
text  
text  
gap     
header-small Protect Your Family  
text  
text  
text  
gap     
header-small Build a Better Tomorrow  
text  
text  
text  

Get the Help You Need

Then Make a Plan & Get It Done

TO MANAGE EVERYDAY MONEY. The first task in any financial plan.

[               ]   To put you in control, use How to Manage Everyday Spending

[               ]   To get out from under debt, use How to Pay Down Debt.

[               ]   Use Figure Out a Reserve for Unemployment for a better estimate.

 

TO PROTECT YOUR FAMILY. Life’s full of unpleasant surprises.

[               ]   To learn more, use Learn About Medical Insurance.

[               ]   Learn About Life Insurance.

[               ]   Learn About Disability Insurance.

[               ]   Use Figure Out How Much Life Insurance You Need for a better estimate.

 

TO BUILD A BETTER TOMORROW. Make a plan for what’s coming next.

[               ]   For retirement, if under 50 use Figure Out a Retirement Plan (if under 50).

[               ]   If over 50 use Figure Out a Retirement Plan (if 50 or over)

[               ]   If thinking of moving, use Figure Out How Moving Changes Your Finances.

[               ]   To see if refinancing makes sense, use Figure Out “If You Refinance …”

 

NEED SOMETHING ELSE? Then check out our topic pages:

[               ]   Everyday Money Topic Page

[               ]   Reserves & Insurance Topic Page

[               ]   Retirement Topic Page

[               ]   Housing Topic Page

 

NOW GET IT DONE.  Nothing happens unless you make it happen. 

  • Print out this checklist & set your priorities.  Put what’s urgent at the top of the list, then what’s big or what you can do quickly.
  • Make an action plan.  Schedule when you’ll get things done.  Put reminders in your calendar, enlist a coach, and monitor your progress to stay on-track.
  • Then do it.  You’ll be done before you know it and have the peace of mind that comes from having your finances squared away.

Checkup Explanations

Quick Estimate Assumptions

Emergency Funds

  • The amount estimated is the amount needed should the higher earner be unemployed for 9 months and collecting unemployment benefits, and you family cuts its spending 10%.

Life Insurance

  • The estimated amount is the amount needed to maintain your family’s standard of living from now to retirement, assuming your family will need 70 percent of you current income, as there will be one less mouth to feed, with the proceeds held in save investments with an interest rate equal to the rate of inflation.

Retirement

  • Retirement age is for you, with a spouse or partner retiring at the same time.
  • Retirement savings assumed to be held in a tax-advantaged IRA or 401(k) account and invested in an age-appropriate low-cost Target Date Fund, charging fees of 0.25%.
  • Earnings projected to rise 1) 0.5% a year prior to age 26; ii) in line with the wage scale relative to national average wages (AWI) published by the Social Security Administration from age 26 to age 50, with average wages rising 0.5% a year; and iii) in line with inflation from age 50 to retirement.
  • Target retirement income equals 75% of projected income in your 50s, adjusted for saving more or less than 6% of income for retirement (not including employer contributions).
  • Target income from savings is equal to target retirement income less projected Social Security benefits.  Target savings at retirement is equal to 25 times target retirement income from savings – assuming 4% of savings at retirement are drawn out and used as income.

Paying for College 

  • Saving to pay tuition, fees, room, and board.  The current annual costs, taken from The College Board’s Trends in Higher Education Table 1a, are $39,520 for a private college, $17,860 for an in-state public college, and $10,550 for a public 2-year college.  Costs assumed to rise 5.5% a year, or 3% a year above inflation at 2.5% a year.
  • Kids are assumed to be 2 years apart, start college at age 18, and take 4 years to graduate from 4-year schools, 2 years from a 2-year school.
  • College savings savings are assumed to be held in a tax-advantaged Roth IRA or 529 Plan, invested in a low-cost mutual fund invested 50% in  stocks and 50% in bonds.  The fund is assumed to earn 6.8% a year net of fees of 0.25%, or 4.3% above inflation at 2.5%.
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