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Financial Success Isn't About Elections

Roger Wohlner

Barack Obama has been reelected as you undoubtedly know. Contrary to what to what many supporters of Mitt Romney might have been saying, the pos-election world will not come crashing down. The markets will react one or the other and certain stocks and industries might fare a little better than others.

Frankly, I had written this article yesterday afternoon while watching a segment on CNBC featuring the Obama and the Romney stock indexes. To me this was the height of a short-term thinking, and really bad television journalism. With the election hype (and all of those really bad commercials) behind us, it's time to get back to reality and focus on our personal financial situation. Here are three steps that you should consider:

If you are self-employed start and/or fund a retirement plan for yourself. There are options including a SIMPLE, a SEP-IRA, a Solo 401(k), or even a Cash Balance Pension plan. If you work with a financial or tax advisor have this conversation with them. Many of the major custodians (Schwab, Vanguard, Fidelity, and others) can also help your in determining which plan is right for you and in getting one established. Note any appropriate deadlines to establish or fund these plans. You work hard; make sure that you are setting aside something for your retirement.

Make good choices regarding your employee benefits during open enrollment season. For many employees this is the one time each year where you can change your company benefits. This year especially check out all of your options and don't just go with what you currently have in place. Many companies are making drastic changes to health insurance benefits. Make sure you choose the option that is best for you and your family. Overall your employee benefits typically amount to 30 percent or more of the value of your cash compensation. Making the right choices is worth an investment of your time.

Increase your contribution to your 401(k) at least 1 percent if you are not maxing out already. While you are thinking about your other employee benefits, this is a good time to do this. An additional 1 percent of your pay will not be missed, especially if you are expecting a raise anyway. Over time this extra percent will add up to more than you might expect towards your retirement.

This election was nasty and contentious, both at the national and local levels. Don't get caught up in the post election "noise" in the financial press. Had Romney won, I would hardly have adjusted the first couple of paragraphs because for long-term investors (which hopefully describes most of you), the occupant of the White House really doesn't matter much. Building financial security for yourself and your family is about making the right choices and executing them over the long-term. The three steps listed above will get you moving in the right direction.

Roger Wohlner, CFP®, is a fee-only financial adviser at Asset Strategy Consultants based in Arlington Heights, Ill., where he provides advice to individual clients, retirement plan sponsors, foundations, and endowments. Read more about Roger here.

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