KNEE DEEP IN PESACH CLEANING: YOUR FINANCIAL EXODUS
As originally appeared in The Jerusalem Post on April 3, 2020.
“Cleaning your house while your kids are still growing up is like shoveling the walk before it stops snowing.” –Phyllis Diller
Due to the Coronavirus lockdown we actually still haven’t started our Pesach cleaning, even as we are less than a week to showtime. With a home full of kids, who haven’t taken a break from eating over the last 3 weeks, it would be pointless to start cleaning. By far the most common phrase heard in our home since Purim is, “Imma what can I eat?” A phrase repeated for the midnight feeding as well! From what I see and hear from neighbors when I go out for my 100-meter walk (don’t tell anyone but my little course is more like 165 meters), is that Pesach cleaning is in full swing. While many are knee-deep in cleaning solutions trying to get that little, elusive piece of Chametz, sometimes we are often in for a pleasant surprise. In our home, we usually end up finding 10-15 shekel in coins, lots of pens, elusive matching socks and last year, a missing telephone! If you need house cleaning services, contact Diamond Home Support, which provides a well-exception service.
Like clockwork, and this year has been no exception, I receive phone calls from potential clients describing how they were cleaning for Pesach, and they found some kind of account statement, detailing the value of an account that they had long since forgotten about. Usually, the caller had moved to Israel over the last few years, figured that their account was small, and just put it aside and a few years later wake up to discover that nothing has happened to their money.
The Passover holiday celebrates our freedom from slavery. Why not take advantage of this time of year and get yourself out from fiscal slavery and become financially independent?
Get in the Game
Back in high school, I had a coach that said, “you can’t win the game if you don’t play.” There is a common perception that one needs to have a lot of money in order to start investing and that their $35-50,000 just isn’t enough to bother with. The potential loss of not taking care of your investments over the long term can be staggering. You can literally be talking about leaving tens of thousands of dollars on the table because of inaction. Don’t think that just because you have $50,000 no one will talk to you. It’s simply not true. While there may be some advisors who specialize in high net worth clients, many advisors work with smaller accounts. I can also attest that over the last week or so, I have received a bunch of calls from young, 20 somethings who want to take advantage of the market crash. Being in the business through more than one big market sell-off I don’t remember ever receiving the number of calls to take advantage of a market drop to start investing than I have received over the last week. Very encouraging.
Make “Seder”
Everyone needs to start somewhere. Your $50,000 isn’t going to double or triple magically. You need to create a financial plan and start understanding what your short-long term needs and goals are. You can speak to a financial advisor to help you define those goals and needs. When creating the long-term plan, it’s important to also take into account future expenses. For example, the purchase of a car in 5 years, marrying off children in 8,10, and 12 years, is all relevant information necessary for the advisor to give you an accurate picture of what you need to do in order for you to be able to meet these future expenses.
Goals
As I have written hundreds of times, people need to set goals in order to achieve sought after milestones. If you want to lose weight, you set a goal of how much you want to lose. If you leave it open-ended, good luck dropping any weight, it’s just not going to happen. It’s important to set a realistic date for when you’d like to be financially independent. As a guide for how much money you will need in the future, I like to tell clients that they need about 20 years worth of this year’s expense to make it. For example, if you spend $30,000 a year, you will need $600,000. Now keep in mind that any pension, bituach leumi, or social security income that you will receive will lower the overall amount that you need. If you receive $20,000 a year in retirement income, then you will need another $10,000 as supplemental income, which means you would only need around $200,000 in savings in order to be independent.
Happy cleaning and I’d like to wish you all health and happy Pesach.
The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc. or its affiliates.
Aaron Katsman is author of the book Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill), and is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the United States. Securities are offered through Portfolio Resources Group, Inc. (www.prginc.net). Member FINRA, SIPC, MSRB, SIFMA. For more information, call (02) 624-0995 visit www.aaronkatsman.com or email aaron@lighthousecapital.co.il.
