Core Workshop #2:
Reviewing Goals; Understanding Investments:

The Four Buckets of Money is a dynamic and visual tool enabling people to manage their income and savings goals. At the beginning of this Workshop, an initial personalized Four Bucket diagram and plan is returned to each participant. We take them through it page by page so they understand the assumptions and conclusions of the financial projections.

One or more things will happen:
a) they may find errors in our assumptions and so the projections should be revised;
b) they may see that some goals are unattainable and need to be modified;
c) they may see that they are ahead of schedule for their goals and can do even better than they thought.

We have seen these goal plans change participants’ lives. One couple realized they could retire at age 60 instead of waiting to age 65. Another couple realized they had to make a choice between sending their children to private secondary school or sending them to an expensive liberal arts college. Sometimes the information is heartening, sometimes it is a splash of cold water in the face. But whether they bring good news or bad, the projections are realistic and allow participants to make good decisions.

Most people do not have the training to define their goals properly. As a result, they flounder until it is too late to save to retire or to save for college. This Workshop takes them through the process step-by-step so that they will end up with meaningful techniques that they understand. The second part of the Workshop begins demystifying investments. The first question many participants ask is “How should I invest my 401(k)/403(b)?” That, we explain, is premature. They need to have a map before they put their foot on the gas. Good investment decisions are based on their own plan and goals.

We take them through a thorough Investment Policy Questionnaire to educate them on investment basics. Based on this discussion, we help each participant develop their own Personal Investment Policy Summary. Individuals need a written Investment Policy just like large foundations and endowment do. It guides their investment choices between stocks, bonds and other investment classes, and it helps them stay the course in volatile times. Finally, we walk them through a worksheet so they can more clearly see and understand the investment allocation they have currently made, either consciously or unconsciously.