Jimmy Lou, Incorporated

We often hear the question, “How much should I be saving to be able to live well in retirement?” Advertisers and some companies try to market their product based on this seemingly straightforward questions. You hear slogans like What’s your number? or see commercials depicting a soon-to-retire man scoffing at his broker’s suggestion to open a winery. These two examples are equally ridiculous.

The mere notion that a person has a concrete “number” of what she should have in retirement savings is a joke. Even if such a number existed, once the exogenous variables have been entered into the formula to produce such a number, they are almost immediately rendered worthless because life isn’t static. Your life changes daily if not hourly, and what might be the case now may not be the case 15 minutes from now… much less 40 years from now. Inviting a money manager or financial product salesperson into the inner workings of your life so intimately that he would know all the required variables to dynamically modify your number on a day-to-day basis is not only scary, it is folly to even attempt. You do not have a “number”. You are not so predictable that you can be distilled into a single numerical representation. Your life is a movie of epic length, so do not be fooled into the idea that a snapshot is going to provide much insight into your needs twenty years into the future. Ask a recent retiree if this is the life they had envisioned when they were forty years old. They will tell you it is nothing like what they imagined it would be.

As for someone suggesting you open a winery… bwahahahaha! That is a laugh out loud statement. Let’s play with this idea for just a second. Imagine yourself sitting down with a so-called “trusted advisor” and he tells you to start saving so you can… wait for it… open a winery in your golden years. That conversation is not going to happen in Southern New Mexico, and these kinds of commercials are not targeted toward 99.9% of you. This little hypothetical situation is just that, hypothesis. And it will remain hypothesis because it just isn’t going to happen to you.

Something happened recently that made us think long and hard about this. Usually we hear from our clients how they wish they had saved more, or perhaps how they should have started earlier. Now, the tone of this has shifted to questions regarding how aggressive we were when servicing our clients. One client lamented that we were not nearly aggressive enough; we should have somehow implored her to save more for retirement. Here is our response, in case you missed it the first fifty times:

You need to save more for retirement. (That is a complete sentence, without equivocation, qualification or hyperbole… and it is ended with a period.)

This brings us to the inevitable question: “How much more should you be saving?” The answer is simple: As much as you can comfortably afford. There is no formula to arrive at this answer. The answer lies within you.

The reason we don’t give you a specific number is simple. Even if such a number existed, should it represent an amount more than you are comfortable with, you will never do it. Sure, you may give it a go for a few months, but you will stop because it isn’t a comfortable amount. If this magical “number” is less than what is comfortable for you to save, then you will be cheating your retirement based on an arbitrary calculation.

You should save as much as you can comfortably afford.

We can  help you change the amount of your periodic contributions. We can help you make deposits. We can sit down and talk with you about your personal financial situation. We can (and do) make ourselves available to you to help you come to some kind of idea of how much this might be, but what we cannot do is speak for what you do with your money. We cannot sign your checks for you and we cannot talk to your employer on your behalf to have him deduct more money from your check to be placed in your retirement savings account. We are available to you to discuss how we can help you reach your goals at your convenience. We are a good resource for you, so please use us wisely because in the end, the final decision rests with you.

The original idea of a “face book” was a simple online directory for people who lived in a common building or area to see who their neighbors were. It was a useful tool for getting to know those who lived closest to you and a way of recognizing them so you wouldn’t feel left out. Of course, with the social network craze sweeping the nation, clever programmers and marketers have found ways to take this simple concept and apply it on a global scale.

Now, you can keep up with old friends and make some new ones, regardless of where in the world they may be. In essence, social networking allows people to stay in touch when personal, face to face interaction is not an option.

Jimmy Lou, Inc. is almost always available for face to face interaction. We personally answer our phones, and should you get a recording, we always return your call as soon as possible. We answer emails. We meet with you over a cup of coffee or iced tea around kitchen tables and in break rooms. We are not on Facebook because we believe our customers deserve more from us than status update. We demand more from ourselves to make sure that you don’t feel left out. Our availability to you is not limited by “friend” lists and “like” buttons.

As for recognizing faces, we don’t need a social network to remind us who you are. We see you everyday. We talk with you everyday. We love to share our stories with you as much as we love listening to yours. And we do, everyday… in person. That is why you will not find Jimmy Lou, Inc. on Facebook.

If you are trying to stick to a budget, cash is the only way to go. I guarantee if you go to the store with only enough cash in your wallet to pay for budgeted items, you will almost always exceed your goal and never overspend.