People are living longer, and they need to prepare financially for those added years.
“With all these added years come added fears,” says Jean Chatzky, personal finance journalist and financial editor for NBC’s Today show. “If we want all of these additional years to be good ones, we have to be 'ageproof.'”
Chatzky addressed the CUNA Lending Council Conference in Nashville Sunday.
Chatzky explores becoming financially “ageproof” in her new book, “AgeProof: Living Longer Without Running Out of Money or Breaking a Hip,” which she co-authored with Dr. Michael Roizen.
The key to being age-proof is having control of your health and finances. Keep four strategies in mind when evaluating your personal financial status or when talking with members:
1. Assess. People often are too afraid to sit down and assess the state of their finances, Chatzky says. But performing a few simple evaluations will give you a better understanding of your finances today and what you need to do to gain control and age-proof your finances.
To do so, consider:
“Just because someone will lend it to you doesn’t mean you should borrow it,” she says.
2. Automate. Biologically, human beings have a “survive then thrive” mindset, which makes saving and delayed gratification difficult. But having the ability to automate saving, such as an employee-sponsored 401(k), makes it easier to save because the money is taken out of your paycheck before you even see it.
“Automation is the magic bullet that makes 401Ks work,” Chatzky says. “We need to take the ‘magic’ and apply it to other financial decisions, and take the human element out of it.”
3. Substitute. It’s difficult to break a bad habit, but it’s easier to replace a bad habit with a better one. Think about talking a nightly walk instead of having ice cream or making your morning coffee at home instead of stopping at Starbucks every day.
4. Manage. The biggest cause of stress often is money, Chatzky says. And while making lifestyle changes—such as forgoing a weekly dinner out—can allow you to save more, those financial changes often take a long time before you start to see the impact.
Have patience, she says, and allow time to pass before you see the results and understand that cutting spending is working.
►Read more conference coverage from CUNA News, and get live updates on Twitter via @CUNAJennifer, @AdamMertzCUNA, @cumagazine, @CUNACouncils, and by using the #LendingCouncil hashtag. Learn more about the CUNA Lending Council, a member-led professional society for credit union executives, by visiting cunacouncils.org.