91视频

Independence Day is one of my favorite holidays. We put red, white and blue lights on our Bluewater open bow boat and watched the fireworks from the water. It was an amazing sight.

But when do you celebrate your Financial Independence Day?

The term 鈥渇inancial independence鈥� generally refers to having enough income, resources and personal wealth to maintain a desired lifestyle without needing to actively work. It means that one鈥檚 assets are generating more income than expenses, with a little left over. It also could mean learning to spend wisely and living within one鈥檚 means.

Today, it鈥檚 鈥渋n鈥� to be frugal, and since the Great Recession it鈥檚 even gauche to display too much wealth. Surely no one would think it鈥檚 cool to wear a Krugerrand gold necklace in public.

What鈥檚 your definition of personal financial independence? Is it a number, or an income stream? Does the goal of financial independence seem to be moving further away with time? Do you see yourself working a little longer than you had imagined?

If you鈥檙e approaching retirement, your financial health will depend on how well you鈥檝e planned and how well you鈥檝e executed the plan. If you鈥檙e still in your early earning years, the time to start planning is now.

So, where do you go for advice? You don鈥檛 have to look very far to find lists with titles like: 鈥淭en steps to financial independence,鈥� 鈥淣ine suggestions for attaining financial independence,鈥� 鈥淓ight ways to declare financial freedom鈥� or 鈥淪even keys to achieving financial independence.鈥�

You get the picture. There鈥檚 usually something worthwhile and practical in those lists; however, to borrow a sports analogy, they don鈥檛 always cover all the bases.

Here鈥檚 a little more sports speak: Winning teams and coaches know the importance of playing offense and defense; they know their game plan and when to put both into action depending on the situation. This same strategy can apply to your personal finances.

Achieving financial independence takes careful planning and a balance between defensive and offensive tactics. In short, it requires discipline and communication with team members.

Offensive planning means taking certain calculated risks and including strategies that help build and manage wealth.

An important phrase to remember is that 鈥減art of what you earn is yours to keep.鈥� Always contribute everything possible to retirement plans and pre-tax savings. This is 鈥渄ollar-cost-averaging.鈥� It helps moderate the market risk, averaging the cost of stock market investments. Don鈥檛 try to time the market, but follow a consistent asset allocation in accordance with one鈥檚 temperament.

Defensive planning includes strategies that help preserve and transfer wealth. In money management, these might be strategies for asset allocation or portfolio risk management 鈥� like hedging strategies or stops to help mitigate the risk of stock losses 鈥� something that is best done with professional guidance. Of course, it also includes the obvious: insurance 鈥� for property, casualty and liability, disability and life and so forth.

Becoming financially independent and amassing wealth takes time; it鈥檚 a slow process. Do the simple things. Control spending, maximize retirement accounts, keep debt low and focus on building net worth. Don鈥檛 avoid all risk, but rather consider how much would be tolerable. Avoid speculation because it rarely results in great returns. Measure results and refresh financial plans annually.

The most important element to building wealth is establishing specific financial goals and frequently measuring results. Create a plan 鈥� a road map to success.

This plan is a collaborative process between you and your advisers. It鈥檚 a story of how to get from where you are now, in terms of assets and potential, to where you want to be.

Begin with a financial game plan using both offensive and defensive strategies. Then embark on a journey to Financial Independence Day.

Judith McGee is the chairwoman and CEO of McGee Wealth Management Inc., an independent registered investment adviser. She is a co-branch manager of, and offers securities through, Raymond James Financial Services Inc. in Portland. Contact her at 503-597-2222 or [email protected].