One of the people that I have a working relationship with is a woman in her 80s. Now I don’t know how many people in their 80s you know but they have trouble grasping and remember concepts. So I meet with her probably once a month. Now I’ve been working with her for a few years now and some family members are involved at times so they know what is going on and what her financial situation is.
The other day I was meeting with her to go over her new quarterly statements that came in. She always has a few questions because she has a few different accounts. She has four seperate income streams: retirement distributions, social security, annuity payment and investment income. She has a well diversified plan but sometimes looses track of thing which is understood. So I go through the statements and accounts to help her understand where she is and how things are going.
She always hears the bad news of the stock market somehow. So she always wants to know how much she has lost. I have to show her that she has very little invested in the market and that which is is well divesified. That in fact she isn’t loosing money she is taking it in distributions to live off of. Every time I explain this to her I see the same thing happen. She starts thinking. You can see it in her face. Her face kind of drops and she comes out with something along the lines of, “well, I can cut back on my spending.”
I then ask, “why would you want to do that?” And she responds, “so that my kids will get some of this money, I don’t want to spend it all.” Then the next conversation begins about the life insurance policy she has that will pass directly to her kids ensuring that they get a pretty good inheritance. Then when her face perks up again I know the lightbulb went on and it just all seems to come back to her.
The reason I’m telling you this is because she did what most people don’t. She planned ahead. Because of that she doesn’t have to worry about spending her money. She can continue traveling in the winter. She can do what she wants to do without worrying about what the kids will get. Her husband has predeceased her. She had a financial situation she had never seen thrown in her face and she did the best she could. She planned ahead. She has the peace of mind to enjoy the remaining years she has left knowing the kids will get a good inheritance, knowing that what her husband and her have worked their whole lives for will be passed on for the kids to enjoy. She is a perfect mother, looking out for her kids until the day she dies…and perhaps beyond.
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