A Recipe For Financial Success

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There’s nothing quite like serving up a homemade, fresh-out-of-the-oven apple pie. But as much as I enjoy baking and eating this all-American favorite, I never had a go-to recipe that would have folks begging for seconds – at least not until a few years ago. That’s when I found the perfect recipe. It was just different enough to make an apple pie lover’s dream come true.

So what’s all that have to do with personal finances? Believe it or not, a lot! At about the same time I discovered my potentially world-class apple pie recipe, a working group here at USAA was putting the finishing touches on some potentially life-changing personal finance behaviors.

We think this short list gets right to the heart of what it takes to become financially secure.  A simple recipe that holds the same potential for your finances that my — yes, I took ownership — apple pie recipe does for your stomach.

In the coming weeks, I’ll explore the various ingredients in this financial recipe. This month, I’ll just lay out the basic tenets:

Spend Less Than You Earn


(and the sub-component: pay off debt)


Yes, the old concept of living within your means. Sounds pretty simple, but obstacles are everywhere. Just watch  TV or look at your phone and you’ll know what I mean (how did they know I wanted some new running shoes???). I’ll examine some tools and offer some tips to make this your reality.

Protect Your Life, Loved Ones, and Possessions


This one is all about various types of insurance and making sure that your protection package keeps pace with you and your family. Life is always changing and insurance is by no means a fire-and-forget proposition.

Save For Emergencies


Yes, you do need an emergency fund -- sooner rather than later.  Making a commitment to not running up debt and living within your means is key to your financial success. Having an emergency fund in place of at least 3-6 months of committed expenses will allow you to keep that commitment when things go astray. A lot of folks are surprised when I tell them that getting this started is the first step to getting out of debt.

Save Now For Retirement


There are a ton of reasons, some of them very legitimate, to put this off, but now is the time to get started. I’ll explore a number of great ways to do just that and also focus on keeping some flexibility as you do it. A cursory glance at the goings on in Washington should be all the motivation you need to get the ball rolling. Like it or not change is coming.

Prepare Your Legal Documents


Everybody has likely heard of wills, powers of attorney and the like, but do you really need them? The answer -- whether you’re 23 or 83 —is  yes; and maybe not for the reasons you might think. I’ll delve into some of the details and share some experiences that will send you running to the local JAG.

Have An Up-To-Date Financial Plan


As a financial planner this could sound self-serving, but remember, most of the time you won’t even need someone like me to start on the work that needs to be done. Online tools and calculators are available and useful. You will, however, have to sit down with your significant other and discuss goals, resources and priorities.

So there’s my roadmap for the coming months. I’m always in search of good ideas for these columns and the above concepts are certainly wholesome and healthy. And for those who are interested, I’ll even share the apple pie recipe, so you can make it -- and the financial recipe -- your own.

SPOILER ALERT: I’ll just say that Granny Smith apples make all the difference.

Posts in this series include:

Introduction:  A Recipe For Financial Success (this post)

Part One:  Preparation:  A Key Ingredient in Financial Progress

Part Two:  A Tried and True Money Golden Rule 

Part Three:  Emergency Fund 

Part Four:  Save Now For Retirement 

Part Five:  No Fighting Over Leftovers 

Part Six:  Tying It All Together 

Story Continues
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