In Perspectives

As a young professional still in my 20’s, I thought I would shed some light on what I am doing to better my financial position. Nowadays the majority of college graduates come out of school with student debt and have to juggle the demands of a hefty monthly loan payment with rent, car, food, and not to mention some money for fun. So you may be asking yourself how can a young person make this work? The answer is that it is not easy, but having a proper budget and trying to eliminate extra expenses are a good place to start. Below are a few helpful hints:

Don’t let student debt ruin your life – This is probably one of the biggest expenses a college graduate can have fresh out of school and can appear to be an endless payoff schedule. One thing I have found helpful, especially when I started work, was to figure out how much I could truly afford to pay toward student debt. Once I had that number figured out I worked with the loan provider on finding the proper payoff schedule. I am not suggesting you pay the minimum amount required over the longest time period because that will result in the most interest paid over time.  But what I am suggesting is to not let student debt ruin your life. There are ways you can work with the provider to make the payments manageable, at least until you get a better feel for your income and expenses. You can always change your payoff schedule and/or make extra payments.

Create a budget – This point may seem obvious but it is a necessity if you want to stay ahead of your finances. The way I approach this to list off all of my recurring monthly expenses accompanied with the date these expense are due. I then break out when I will be getting paid to see how the month shapes up from a cash flow standpoint. I remember one of the first months I started working I had all my expenses back loaded and made the mistake of thinking I had more money than I had (whoops!), so the timing of expenses is not to be overlooked. Another aspect of the budget that is useful is to figure out what expense(s) you can either payoff or cut-out.  This can be a huge positive for your financial situation because it will eliminate expense(s) and free up funds for other uses.

Allocate funds to your company retirement program – Many companies, but not all, give their employees access to a retirement plan, typically a 401k or a variation of this tax-deferred account.  The time value of money is something that cannot be overlooked and should be taken advantage of by all employees; especially those in their 20’s as they will see the most benefit over the long-term. When you begin working or get a new job, be sure to look into if your company offers a retirement plan and if they do, check to see if there is some type of company match. When thinking about how much to allocate I have found that between 4-6% is a good starting point. If you are fortunate enough to get a company match that will turn into 6-9% savings which puts you on the path towards a great nest egg for retirement.  Over time, you will want to increase your contribution percentage, but at least start by contributing enough to receive the maximum match from your company.

These are a few things I am working on in my own finances and are what I would suggest any young professional to consider a similar approach. If you have any questions or would like to discuss additional planning strategies, please do not hesitate to contact Legacy Trust.

Legacy Trust and Your Right to Financial Privacy

At Legacy Trust we have established policies and practices that respect the financial privacy of all individuals who use our trust company. We believe it is critical to comply with the laws and regulations designed to secure your financial privacy. Your relationship with us as our client is very important to us, and we want you to understand our policies and practices about handling your information.

This Policy applies to you – This Policy applies to our relationships with individual clients who inquire about or obtain products or services from us for personal, family and household purposes.

Strict security measures – We take the security of information very seriously. We have established security standards and procedures to prevent access to client information. We maintain physical, electronic and procedural safeguards to guard client information.

Limited employee access – We have established procedures to limit employee access to information to only those employees with a business reason for accessing such information. We educate our employees about the importance of confidentiality and client privacy. We take appropriate disciplinary measures to enforce employee responsibilities regarding client information.

Why we collect information – We collect information about you to:

  • accurately identify you;
  • protect and administer your records, accounts and funds;
  • help us design or improve our products and services;
  • understand your financial needs;
  • save you time when you apply for new products and services; offer you quality products and services; and comply with certain laws and regulations;

We collect information – We collect and maintain your personal information so that we can provide investment management and other services to you. The types and categories of information that we collect and maintain about you include:

  • Information we receive from you to open an account or provide investment advice or other services to you (such as your home address, social security number, telephone, financial information and investment objectives).
  • Information that we generate to service your account or from our transactions with you (such as account statements and other financial information).
  • Information on your transactions with nonaffiliated third parties.

We have established procedures so that the financial information we collect is accurate, current and complete. We are committed to work with you to promptly correct any inaccurate information.

Our selective sharing of information – In order for us to provide investment management and other services to you, we do disclose your personal information in very limited instances, which include:

  • Disclosures to nonaffiliated companies as permitted by law, including those who help us service your account (such as providing account information to brokers and custodians).
  • Other limited disclosures as permitted by law, for example, required reports to government entities.

We do not share your information with third parties for marketing purposes. We do not sell your information.

Former clients – If you end your relationship with us, we will continue to adhere to the privacy policies and practices described in this notice.

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USA PATRIOT Act

Important Information About Procedures For Opening A New Account

To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

We apologize for any inconvenience this may cause; however, federal law prohibits us from waiving these requirements.

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