The Smart Woman’s Guide to Retirement Planning by Mary Hunt – Personal Finance Book Review
Money expert Mary Hunt returns with a new book, “The Smart Woman’s Guide to Planning for Retirement,” to help women thrive financially in the new year and beyond. Although aimed at women, men can also benefit from Hunt’s financial knowledge, honed after she racked up over $100,000 in debt earlier in life; and took 13 years to disappear.
“Did you have a revival at retirement? Hunt asks at the start of the book. “I can promise you they intensify with age.”
Hunt sites a 2012 survey that found that 92% of women of all ages don’t feel educated enough to meet their retirement savings goals.
Saving for retirement takes determination and hard work; and Hunt believes women can be successful. “If we lack confidence it’s because we lack knowledge and desire, certainly not because we lack intelligence and ability,” Hunt said.
Time trumps all factors when saving for retirement. The earlier you start, the better. But, Hunt points out, whatever stage you’re at in life, you need to start now. “It’s too late if you don’t start now. No matter where you are or how little you think you have, start now. Today. Start. Save.” Take small steps to produce long-term results.
Functionality of Hunt’s Teachings:
retirement savings plan. Hunt promotes a six-step retirement savings plan, which includes:
Build an emergency fund. Also known as a provident fund. Save money for unexpected life expenses (car repairs, home repairs, etc.). This money must be liquid (easily accessible within two or three days), protected from erosion (constitute a savings account without risk) and be able to be financed with at least six months of subsistence expenses in the event of job loss or other compromised income event.
Have no more debts. Eliminate all unsecured debt (credit card debt, student loans, personal loans). Hunt says they’re like cancer stealing your future. Incorporate Hunt’s Rapid Debt Repayment Plan (RDRP) to abolish debt.
Own your home. Buy twice as much home as your mortgage approval. Make monthly mortgage payments equal to the total approved amount to own your home in half the time. Be fiercely protective of your home equity (the difference between the market value of your home and your mortgage balance). Avoid taking out a home equity loan or line of credit, which resets the clock on a thirty-year mortgage.
Consider hiring a financial planner once debt is eradicated or managed, a respectable amount of savings is amassed, retirement funds grow, or an inheritance IRA or other financial windfall emerges.
Hunt describes three types of financial planners:
- Commission based. This planner does not charge by time, but by selling investment products. He or she earns commissions on these sales.
- Paid. This scheduler works on flat fee or hourly fee. Fees are shown up front and the planner is a Registered Investment Advisor (RIA). They are required by law to adhere to fiduciary standards, which makes them responsible for putting the best interests of their clients first.
- Combo. This scheduler is a combination of the first two. Clients pay fees, either fixed or hourly, and the planner earns commissions when the client purchases financial products based on their recommendations.
Choose a financial planner with at least five years of experience Hunt suggests. Make sure they are acting in your best interest and can explain financial concepts to you at your level. Beware of any planner who claims to be able to beat the market. Ultimately, collaborate with a planner; still make your own investment decisions. Hunt points out that “A counselor’s or planner’s primary loyalty will be to the hand that nurtures him. That is simply human nature.”
Hunt educates in a conversational tone, avoiding jargon, graphics, and mind-numbing data, making it an engaging read. A Christian, she teaches faith-based money management. Hunt believes that God is the source of all of life’s blessings, including money. An employer, spouse, investments, trust account, relatives or any other entity are the channels through which the money flows, but not the ultimate source. She reasonably prepares for her retirement without obsession; and trusting God for the outcome.
While it’s important to have a retirement nest egg, Hunt reminds readers that there’s more to life than money. Health, spirituality, nurturing relationships, staying active, lifelong learning, and volunteerism are some of the attributes of a well-rounded existence.
Decade-by-decade financial planning, the five tools needed for a money management system, the basics of investing (automate all payments to avoid not making monthly dues (out of sight, out of sight, out of the blue), reverse mortgages, and parents paying for their children’s (non-mandatory) college education, are other money-saving/building topics covered in the book.
Anyone committed to improving their financial health in 2014 will reap life’s treasures, beyond the limits of money, by inheriting the financial practices of Mary Hunt.
To establish your basic financial situation and/or track your progress, order your free credit reports from the big three credit companies: Equifax, Experian, TransUnion, visit: Annual credit report.