Personal Finance Management Too Often Neglected

Personal finance management is often ignored or not taken seriously. It is only when some financial crisis looms that we start to focus. Often the situation can be rectified, but sometimes it is too late.

If the crisis manifest itself during your retirement provision phase, and especially during the last few pre-retirement years, it could have very serious consequences. I have firsthand experience of such a situation.

A relative was widowed some years ago. The management of their personal finance was grossly neglected by her husband before his death and she inherited for all practical purposes a bankrupt estate.

Although a qualified teacher, she has not been working for decades. Yet she was fortunate to get a teaching job in another town. At the time I was living in Switzerland and could only advise her over the distance. What made things worse is that she is not computer literate and was unable to pick up basic skills for email communications.

I did some research on the Internet and devised a rescue package that could provide her with a small pension at retirement. I made the mistake to assume that she understood that she had to micro manage her personal finance to achieve this pension. I also thought that she understood the seriousness of the matter and would adjust her lifestyle to a frugal lifestyle.

Five years down the line during a visit she announced that she was now ready to implement the plan I devised five years ago! Could I please assist her? I had the scare of my life! It turned out that the funds I assumed she was saving in the retirement fund I specified five years ago, were spent.

She is four years from compulsory retirement and has health problems. She might not be able to keep on working till retirement.

I have now implemented the original plan on her behalf, but even if she works the four years left and maintain the severe savings program we implemented, she won't achieve a livable pension by the time of her retirement.

Please do not neglect your personal finance management in your retirement provision phase. On this Web site we focus on many retirement planning issues from various angles. Educate yourself and take control of your financial management.

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