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At our house, Thanksgiving dinner has always been about family and eating and then some more eating. And this year, we are back to business as usual. We will have a full house and we’ll be focused on food. Each element of the day’s dining brings a unique something to the overall Thanksgiving experience.
In the spirit of the holiday – and to stoke my anticipation and simultaneously knock out some work – I thought I would use the items from our upcoming Thanksgiving menu as appetite-enhancing metaphors as you create your own financial masterpiece.
Appetizer: Celery, olives and cream cheese
Financial equivalent: Goals
This simple appetizer is a go-to at all our family gatherings. It’s easy and delicious and because I typically alternate between preparing one for the appetizer tray and one for my tummy, the day’s feast begins here. Financial security starts with your goals. What, specifically, are you trying to accomplish, and when?
Main course: Turkey
Financial equivalent: Budgeting
“Spend less than you earn” is the golden rule of personal finance and turkey is the cornerstone of our Thanksgiving meal. No one likes dry turkey and getting it just right can be a challenge. The same can be said with budgeting. Thankfully, budgeting tools and other technology and apps can ease the burden. Figure out where your money is going, where it should go, and then map out a plan to make a move to a better place. It all starts with tracking your current spending.
Side item: Gravy
Financial equivalent: Emergency fund
Gravy is a fantastic pick-me-up. An oven mishap leaves you scrambling for a solution to your dry turkey? Iffy mashed potatoes consistency? Douse them with gravy. Are you prepared for a financial emergency? If an unexpected expense would cause you to borrow, sell stuff or break out your credit card, the answer is no. Set up an allotment or automatic transfer to your emergency savings account to build your own solution if a financial mishap has you floundering.
Side item: Cranberry sauce
Financial Equivalent: Insurance coverage
Much like the complementary side dishes we try out at our turkey dinner, this is a moving target. The types and amounts change depending on where you are in life. This year, we are trying rhubarb ginger compote in lieu of cranberry sauce (well, probably not, but that sounded sophisticated!). With insurance, you might need to add umbrella liability coverage, replace Servicemembers Group Life Insurance if you’re leaving the military, or just add some additional life coverage to account for a new baby. Be sure that all your insurance coverage is on track.
Side item 3: Stuffing
Financial equivalent: College savings
A few years ago, I forgot the stuffing and the shelves of the one store that was open Thanksgiving morning were bare. That year, we were caught short and missed out on this staple. That’s an experience I equate to saving for college. You don’t want to wake up one day to the reality that you haven’t prepared for the finances of college. How? Maybe you begin to fund 529 college savings accounts, so your children don’t graduate with a massive amount of debt. Or ensure you’re all set when it comes to the transfer of your Post-9/11 GI Bill. Equally important as funding college: spend a little time talking to your kids about good financial habits on a consistent basis.
Side item 4: Corn
Financial equivalent: Save, save, save.
There’s typically a “good” reason or upcoming expense that keeps you from starting or boosting what you are putting away for emergencies, retirement, or other financial goals. There have been times over the years when we have tried to kick corn to the curb. However, it’s a mainstay. Can you really skip the mashed potatoes, corn, and gravy combo? Similarly, regular savings habits are at the core of securing your financial future. We don’t leave corn off our menu anymore, and you shouldn’t leave savings out of your routine.
Dessert: Pumpkin pie
Financial equivalent: fun money.
No matter how many helpings of turkey and mashed potatoes I’ve had, my Thanksgiving just isn’t complete without a small (or not so small!) slice of pumpkin pie. The same goes with your financial plan. In moderation, a “fun money” account (think entertainment, restaurants, or vacation) helps keep your budget on track by allowing you to avoid binge spending when you want to have a little fun.
What’s a must-have on your Thanksgiving menu?
Don’t put all your eggs in one retirement basket
About the Author: JJ Montanaro is a Certified Financial Planner® professional and part of the Military Affairs team at USAA. He’s a graduate of the U.S. Military Academy and has over 20 years of financial planning experience.
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