Episode #15: Understanding Your Statements

Today’s Prep:

Your financial statements are confusing. They contain all sorts of jargon and puzzling graphics. On this edition of the podcast, Eric enters the fray and helps to clear up the confusion.

 

Equipping Points:

00:47 – Financial Statements Are Confusing.

  • Financial statements are confusing. They contain all sorts of buzzwords and jargon, and in reality, we really just want to know how much money we have and what it’s doing. One of the things we strive to do is help our clients to understand their finances. This means when you come in for a visit, we’re going to sit down with you and take a look at those confusing statements to determine exactly what’s happening with your wealth.

4:28 – Defining Income Projections. 

  • Income projections predict what level of return you can expect to generate from your investments. They look at your current investing rate and make an assumption of return. You really should take those assumptions with a grain of salt as they are based off of your age as well as your projected levels of income and returns on investment.

6:00 – Pretty Charts And Graphs. 

  • Your asset allocation summary can quickly get confusing as it’s usually depicted through a thoroughly confusing chart or graph. However, it’s basic function is to show you where your money is being invested. Asset allocation summaries tell you what types of stocks you’re invested in. They also illustrate different asset classes like international stocks, real estate investments, and mutual funds. Asset allocation is important as you want your money to be diversified amongst different asset classes and even within asset classes.

Other Preparation:

  • 9:27  – Understanding Fees.
  • 12:28 – Beware Of The Fine Print.

Today’s Takeaway:

“While financial statements can be confusing, it’s important you understand them as they’re an indicator of your financial health. If you don’t understand the jargon, use your advisor as a resource. Get them to explain your statements to you. – Retirement Ready

More From Eric:

The host: Eric Peterson - Contact - Call: (515) 226-1500

Subscribe To The Podcast:

Apple Podcasts  -  Google Podcasts  -  Spotify  -  Stitcher  -  iHeartRadio  -  TuneIn

Check out some other recent episodes

Financial Wisdom from Mark Twain

June 13, 2024

In the latest episode of the Retirement Ready Podcast, Eric invites us to explore the timeless wisdom of Mark Twain and how it applies to modern financial planning. Mark Twain, known for his wit and keen observations, offers quotes that are surprisingly relevant to today’s financial landscape. Eric takes these quotes and translates them into practical advice for those planning their retirement.

Read More

Understanding Bonds in Today’s Market

June 6, 2024

Are bonds really the safe investment we’ve always been told they are? What percentage of assets should a retiree or pre-retiree hold in bonds? In today’s episode, Eric addresses some of his most frequently asked questions about the world of bonds…

Read More

Understanding Your Financial Statements

May 30, 2024

Financial statements can often feel like a foreign language, filled with jargon and numbers that seem to have little relevance to your everyday life. However, understanding these documents is crucial for effective retirement planning. In the latest episode of the Retirement Ready Podcast, Eric breaks down the essentials of reading and interpreting your financial statements.

Read More

From Graduation to Retirement

May 23, 2024

This one goes to the grads! Whether you know someone graduating high school, college, or even preschool, graduation marks a new stage and season in life. Similarly, retirement is a new chapter in life. It’s a time of change, celebration, and sometimes, uncertainty. On today’s show, we talk through the similarities between leaving school and entering retirement.

Read More

401(k) Mistakes

May 16, 2024

Your 401(k) likely plays a major role in your retirement savings. That’s why it’s important that it’s set up and functions in the way that’s most beneficial to you. Following our last podcast about beneficiary mistakes, now we focus on common mistakes people make with their 401(k).

Read More

Beneficiary Mistakes

May 9, 2024

In this episode of the Retirement Ready Podcast, Eric guides us through the critical yet often overlooked details of beneficiary designations. Learn the simple yet vital steps to prevent beneficiary blunders that could lead to unnecessary headaches for your heirs. Eric calls these errors “low hanging fruit” because they’re easy to fix yet can save your family from future heartache.

Read More

How Emotions Can Impact Your Retirement Plan

May 2, 2024

Dive into the world of financial emotions in this episode with Eric Peterson. Discover how greed, fear, hope, and pride can make or break your investment strategy. Eric unravels the complexities of managing emotions to ensure a secure and enjoyable retirement.

Read More

Retirement Planning Statistics

April 25, 2024

Retirement is closer than you think, but are you ready? With a staggering number of people lacking confidence in their retirement savings, Eric shares the misconceptions people have and what mistakes can derail someone’s financial future. Many people feel inadequate when it comes to what they have saved in their nest egg, uninformed about the pitfalls of target date funds, and unprepared about the reality of leaving the workforce earlier than expected.

Read More

Mailbag: Should I Fire My Broker?

April 18, 2024

Navigating life’s financial crossroads can be tricky, especially when it involves your financial future. In this episode of Retirement Ready, Eric addresses these complex issues head-on. How do you best evaluate your broker and your investment performance against the S&P 500? Eric says a lot of that comes down to setting expectations and understanding the risks. Then, Holly wants to know what to consider before making a midlife career change.

Read More

Putting It Off

April 11, 2024

We are all guilty of procrastinating from time to time. Financially speaking, though, this can get you into a lot of trouble. Let’s talk about the areas where it might feel better to kick the can down the road.

Read More

Leave a Comment