We all procrastinate.  The Human species is a procrastinator.  Don’t beat yourself up over it, but don’t deny the problem either.  We all would rather put off unpleasant tasks today that we can do tomorrow.  Given a choice between checking your email/Facebook page or finishing off that latest Criminal Investigation Supplement report and most Troopers will choose the former.  We will eventually get to the supplement but it can usually wait.

As a financial planner I meet people in all stages of their lives; some are beginning their work-life; some are finishing; some are already retired; and others are starting their second careers.  Consequently, I get to see firsthand the effects of financial procrastination and it is not a pretty sight.  Often, by the time we meet, some folks are beyond the point where they can correct their past errors.  I think the most serious financial mistake we see is a person’s failure to save enough money for the future and most of the time it is due to their inability to delay instant gratification—which in a way, is simply saying they procrastinated in saving.

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Social Security benefits may not be the most exciting topic in this edition—and reading about obscure Social Security Administration regulations may not be your favorite pastime; but this stuff is important—and it’s complicated—so grab a double espresso, sit down, turn the TV off, and read up.

First of all, let me say up-front what I have said in this magazine many times—you are one of the fortunate in the world who have a government pension. Most of my clients do not. They have no guaranteed monthly paycheck; no automatic and unlimited cost-of-living raises; no subsidized health-care; and for that matter; no 22-year retirements. People usually have what they have saved in an IRA or 401K and when they retire they get nothing from their employer other than their last paycheck and a pat on the back. (Surprisingly, because they had to take control of their own retirement and actually save some money–many of these clients are better off than our own retiring Troopers; but that’s a subject for another edition.)

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This edition we will cover the two defined contribution investment retirement plans available to you as a State Employee. Maryland offers two plans to employees of the State Police, the IRC 457(b) Deferred Compensation Plan and the IRC 401(k) plan. They are so named by the section number of the Internal Revenue Code where they are defined. Surprisingly, you can fully participate in both, but we’ll cover that later.

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The absolute worst enemy of investing and saving and thus building wealth is human emotion.  Human emotion whispers in our ear every day that we should do something, take action, make decisions about our investments, etc., when in reality, most of the time we should do nothing at all.

When it comes to investing, the saying don’t just sit there, do something, should be turned around to don’t just do something, sit there.  I have found the best investors and the ones with the most assets are people who understand the simple concept of periodical and unemotional investing.  It really is that simple.

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I’ve always thought that one of the greatest benefits of becoming a Maryland State Trooper is the chance to retire at a comparatively early age–for me 45.  The majority of the working world must continue to work until at least 66 or 67 years of age.  Of course, we are speaking of retiring from the State Police only, not many people completely retire at 45.  It is more the opportunity to change professions that makes being a Trooper something unique.  Some people fear career change while other can’t wait to begin.  This edition’s article will cover a few things to think about when nearing your MSP retirement.

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Ok, just so we’re straight from the opening line, I don’t think anybody really likes life insurance.  It’s like auto insurance—who gets up in the morning and thinks, “Wow, joy, joy!  I get to send in an insurance premium check today.”

But—unless you’re immortal nobody gets out of here alive!  Sooner or later we are all going to die.  The hope we all have is that it’ll be much later than sooner, but, in the event death does comes sooner than we have planned for, we need to protect the ones we leave behind.

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Debt must be a wonderful thing. Just look at how much debt the good Ole USA has—and we are the largest economy in the world—by far. If the richest, most prosperous nation in the world is also the one that borrows the most money, then is it a leap to think that what debt has done for the US can also do for our personal finances? The answer in a word is, no; a big NO as a matter of fact. In this edition we are going to look at how to improve our personal Balance Sheet.

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Mutual Funds are everywhere! They are in your retirement accounts, your personal investment accounts, your pension system, they dominate TV and radio commercials, and entire magazines are dedicated to tracking their performance. But just what exactly is a Mutual Fund? Chances are your financial future is somehow affected by the selection, performance and quality of a Mutual Fund, so perhaps it’s a good time to go over some basics regarding this popular investment vehicle. Besides, the best time to review or talk about a “basic” concept is when it is so “understood” that everyone assumes everyone else already knows about it.

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As I write this during the third week of October 2008 the world’s equity markets are in the midst of a sharp decline—some are calling it a “melt‐down.” Many mutual funds have fallen over 40% for the year and there seems to be no end in sight.

Warren Buffet says “Investing is simple but not easy” and in today’s market that statement is truer than ever. Investing boiled down to its essential elements is very simple, buy something at one price and sell that thing later at a higher price. Buy low and sell high. But while intellectually investors know what to do—emotionally investors often do the opposite. Studies have shown that investors invest more money when the market is up and take money out of the market when it is down—basically buying high and selling low.

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About a year ago I was talking to a retiree I used to work with in CVED and I asked him how retirement was treating him, he said, “Marty, have you ever heard of the term ‘The Golden Years?’ Well, just drop the G.” We laughed and then he ticked off a litany of nasty medical issues he and his family were experiencing. He was not enjoying retirement—well, actually, he was not enjoying the human aging process.

I don’t think the human body is designed to live as long as we do these days. Advancements in medicine and our affluent lifestyles have managed to extend our time on Earth for a much longer period than the physical body was designed for. 2000 years ago the average life-span was 24 years—about the time most of us graduated from the police academy. Today, many of us will make it well in to our 90’s.

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