Wisdom on Wealth

Question: Someone talked me into consolidating a bunch of credit cards I had with high interest rates. Now I have no idea how I ever made it when paying on all those cards each month. They said I would be able to save the money, but I haven’t been able to. What do I do now?

Answer: Begin by telling yourself the truth.

Question: I know that I am financially sick. I am not sure how to start a budget. My credit score is a total mess. I cannot even figure out how I got here. How do I get well?

Answer: When you’re driving, it’s a good idea to keep your eyes looking forward, with occasional glances into the rearview mirror to see where you’ve come from.

Question: My wife and I do not communicate well about money. I think she is too sensitive and she would probably say I am hard-headed. Every time one of us brings it up we usually fight. So we keep putting off dealing with it. We’ve got too much debt and we aren’t making any progress towards retirement. How do people like us deal with this?

Answer: How do “people like us” usually deal with these kinds of issues? They usually don’t.

They put it off until the problem is bigger and more difficult to resolve.

But that is a horrible strategy, especially when a solution is so simple to come by.

Question: I have seen my own parents and some of my friends do some things financially and otherwise that just seem obviously dumb. Or at least shortsighted. The example I’m thinking of when they buy things with a credit card that will then charge them 18% for the privilege. But it could be any number of things. Why do you think people make these kinds foolish financial decisions?

Answer: Economists like to say people are rational.

Whenever I read that, I think, “Sure are…sometimes. But other times, they are fearful, other times resentful, other times prideful and once in a while, just plain dumb.”

Question: Do you pay taxes on money you make when it’s in a mutual fund?

Answer: Generally speaking, yes.

I’m pretty sure every program on network television is currently being funded by drug company commercials.

Question: I’m not the kind of person who likes surprises. In your experience, what is the biggest surprise facing most retirees and what can I do to get ready for it now?

Answer: Wow. That could be a long list.

Like the Oscars, an announcer might read from a cue card, “And the nominees for Biggest Surprise in Retirement are…” (drum roll, please)…