5 Financial Moves After You’ve Paid Off Your Debt, Planned For Retirement, & Created An Emergency Fund

October 15, 2014  |  

 Most personal finance advice targets readers without a financial clue—riddled with debt, over budget, and without a plan for establishing or implementing a long-term financial strategy around retirement.

But there is another demographic with a unique set of money concerns that often goes overlooked.

I call this demographic “financial overachievers.”

Financial overachievers have done all of their financial due diligence—paid off their debt, maxed out their retirement contributions, and maintained at least six months of emergency funds—and now are unsure about what money moves to make next.

For the financial overachiever, this state of uncertainty may create a bit of anxiety. Below are a few options for financial overachievers to consider as they move forward in building and protecting their wealth:

Draft a will. Despite the images that movies and television promote, estate planning isn’t exclusively for the wealthy or the old. Financial overachievers, with a track record of financial planning and success need to take time to explicate clear guidelines, orders, and plans for when they die or in case they become disabled.

Most young adults in their 20s or early 30s who are single and childless can probably get by with a no-frills will using computer software like Quicken’s WillMaker Plus.

Those with more complicated financial situations: assets over $2 million, a child with disabilities, children from a previous marriage, or particular wishes for what they want done with their assets should consult a lawyer. With guidance and support from a lawyer, it will be easy to draft a comprehensive will which will cover: 1) what people or organizations will inherit which property; 2) who will serve as guardian to care for minor children; 3) who will manage the property left to minor children; and 4) who will serve as executor — the person who will carry out the wishes of the will.

Buy renters insurance. Although young financial overachievers are vigilant about establishing strong financial structures and systems, they still fall short when it comes to protecting themselves and their assets for the long term. According to an analysis by the National Multi Housing Council, young adults are more likely than other age groups to live in rental housing, with 72 percent of householders under age 30 or younger living in rental housing. Despite this reality, a 2014 Insurance Information Institute poll conducted by ORC International found that only 37 percent said they had renters insurance compared to 95 percent of homeowners had homeowners insurance.

Renters insurance, on average, costs $12 per month. According to Independent Insurance Agents & Brokers of America (IIAB), that amount provides $30,000 worth of property coverage and $100,000 of liability coverage.

Become a first-time investor. In a conversation with Motley Fool investment-planning editor Lauren Kuczala, financial planner Dan Caplinger points out that many mutual fund companies allow people to invest small amounts—as little as $100— as long as they commit to making regular additions to their account. He also shared that other specialty investments such as savings bonds offer a chance to invest small amounts to get returns that will be better than some other fixed-income options.

Begin a start-up. Millennials, those ages 18-to-34, have an entrepreneurial spirit. In 2011, the Young Invincibles in conjunction with Lake Research Partners and Bellwether Research conducted a nationwide cell phone and landline survey to  872 millennials. The results revealed that “[f]ifty-four percent of the nation’s millennials either want to start a business or already have started one.” Sites like Khula TV provide informative and inspiring content as well as networking resources to help entrepreneurs launch and expand their businesses. The Small Business Administration, too, can avail enthusiastic young entrepreneurs with access to workshops, classes, and community-based organizations that support small businesses.

Invest in personal development and self-improvement. With more disposable income, financial overachievers can look inward and work on enriching their lives and others’ lives. Connecting with organizations like Friends of Ebonie can help millennials leverage their dollars to make change and support causes of interest. Similarly, with a few extra dollars, financial overachievers can indulge their wanderlust by joining groups like the Nomadness Travel Tribe, an urban travel movement that spans 8,000 members and over 36 countries.

Connect with Kara @frugalfeminista. Learn more about The Frugal Feminista at www.thefrugalfeminista.com Download her free ebook The 5-Day Financial Reset Plan: Eliminate Debt, Know Your Worth, and Heal Your Relationship with Money in Just 5 Days.

And be sure to tune in to Cafe Mocha radio for their “Get Smart” series where they’ll be tackling some of the most important topics for women throughout the month of October. We’ll also be kicking off the MadameNoire partnership with Cafe Mocha, featuring our segment “Did Y’all See” Saturday October 11. Check out Cafe Mocha’s website for local air times and SiriusXM Channel 141 Saturdays from 1- 3pm EST to catch MN on the air!

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