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Financial Wellness is Within Reach
Edition 10: June 2019
Fresh possibilities with financial wellness
For many of us, being able to afford a college or medical degree means taking on a good deal of student loan debt. And that debt, coupled with the expenses of life in the "real world," can make achieving financial wellness feel out of reach.
But it may be time to take a fresh look at financial wellness. That's because your retirement account comes with the tools and resources you need to help you achieve it—including tools specifically designed to help you tackle your student loan debt.
At no additional cost to you, the Student Loan Assistance feature of your retirement account lets you compare multiple loan repayment scenarios to see which one best fits your unique financial situation. And, for even more personalized help, virtual one-on-one repayment counseling is available.
To check it out, log in to your account and click the My Financial Life tab.
While you're there, you can also explore the possibilities of taking control of your daily finances, saving for long-term goals—like retirement, and protecting yourself against the unexpected.
Because from the financial wellness assessment to the debt management tool to the budget planner, you just may discover achieving financial wellness is more of a possibility than you thought.
It's like getting free money!
As a reminder, for every $1 you contribute to your account (up to 6% of your pay), LG Health/Penn Medicine will add a $0.50 employer match. What's more, they'll deposit another employer basic contribution (equal to 2% of your pay) whether you contribute or not. So, if you're not contributing at least 6% to your retirement account, don't leave money on the table. Increase your contribution.
But I don't feel like an adult!
Spoiler alert: no one does. Being an adult mostly means handling things that are boring, but necessary—like naming or updating a beneficiary for your retirement account.
Having current beneficiary information on file with our retirement plan provider, Prudential Retirement®, will help you create a legacy, while sparing your loved ones the stress of paperwork and court proceedings.
You can review or update your beneficiary information online. Just log in to your account to get started.
Then be sure to give yourself a pat on the back. You're an awesome grownup!
"It's like a bad joke!" Linda lamented. "How can I be expected to save for retirement while I'm still paying off my student loans? This is not what I thought my 40s would be like."
Linda's exasperation is what motivated her to reach out to dedicated retirement counselor Mike Phyillaier. She'd been working hard to pay off her student loans, but she still had $54,000 to go. And, lately, she'd been unable to shake the nagging feeling that she wasn't doing enough to prepare for the future.
"It's not an uncommon feeling," says Mike. "Many people are motivated to prepare for the financial future but feel held back by choices they made in the past. Sometimes it's credit card debt. Sometimes it's a few false starts in the career area. But, more often than not, it's student loan debt that's holding them back."
Because this is a challenge so many people face, financial professionals—including dedicated retirement counselor Mike Phyillaier—have become well-versed in creating the solutions people need to help them move forward.
Together, Mike and Linda reviewed the new financial wellness tool called Student Loan Assistance that's found in the My Financial Life section of her online retirement account. They were able to compare the outcomes of various options, like loan consolidation and refinancing. They even explored a Public Loan Forgiveness Program, which would significantly lower Linda's loan payments.
The many options for dealing with her debt gave Linda a sense of relief and hope for the future. Relieved and impressed by her experience, she has become a proponent of Student Loan Assistance and is spreading the word among co-workers. But you don't need to wait to hear it from Linda. Contact Mike to learn more.
Have you upgraded your account?
To use the financial wellness tools everyone's buzzing about, you'll need to upgrade your account. To upgrade, simply log in to your account and follow the on–screen prompts. If you have not yet registered your account, visit LgHealthRetire.org, click on "Register Now," and follow the instructions to complete the registration process.
GET HELP WITH YOUR FINANCIAL WELLNESS—AND YOUR STUDENT LOANS!
Mike Phyillaier is a full-time retirement counselor who is dedicated to helping LG Health employees make the right moves toward financial wellness. To enhance your financial wellness—or to learn about the new Student Loan Assistance Program—make your appointment with Mike today!Office: 844-LGH-RET1 (844-544-7381) (Press "2")844-LGH-RET1 (844-544-7381) (Press "2")
Email: firstname.lastname@example.orgSchedule an appointment
Edition 6: June 2018accordion tab openaccordion tab closed
Make time today for your account checkup!
When it comes to planning for retirement, financial professionals often recommend that people review the investments they've chosen on a regular basis. Why? To help them ensure that their investment allocations are in line with their long-term retirement income goals, and how they feel about risk.
This year, there's been a lot of volatility in the stock and bond markets—meaning the prices of investments have been going up and down quite a bit. That makes this an ideal time to check the investments you've chosen for your LG Health Retirement Plan Accounts, and to make any adjustments you feel may be necessary. And, if you're not already doing so, you may wish to consider the benefits of asset allocation and diversification when it comes to choosing your Plan investments.
How asset allocation and diversification may help people
Asset allocation and diversification are two investment concepts that may help you in all market conditions. Asset allocation, which can help you choose your investments and manage risk, refers to the process of spreading your money across major investment types—such as stock funds (also known as equities), fixed-income funds (also known as bonds) and stable value (also known as guaranteed investments).
Asset allocation is closely related to diversification, which takes things a step further: To diversify, you simply choose an appropriate mix of investments, not only across the major asset classes like stocks and bonds, but also within them (large-company growth stocks or intermediate-term government bonds, for example). This may result in less volatility in a diversified portfolio, even when certain market segments are experiencing wide price swings. Keep in mind that application of asset allocation and diversification concepts does not assure a profit or protect against loss in a declining market. You can lose money by investing in securities.
Investing made simple... with a one-fund approach
If you're looking to make investing easy—and want to take advantage of built-in diversification—you may wish to consider investing in a Target Date Fund, which offers the simplicity of a complete portfolio in a single fund.
How does a Target Date Fund work?
Each fund invests in several broadly diversified Vanguard funds.As the target date in the fund's name—such as the Vanguard Target Retirement 2030—draws near, its investment mix becomes more conservative. That means that a single Target Date Fund can serve you throughout both your career and your retirement. Taking a closer look:
- A Target Date Fund will hold more stocks the further it is from its target date, seeking stocks' high-potential growth. (Stocks also tend to have the highest risk of loss.)
- To reduce risk as the target date approaches, Vanguard will gradually decrease the fund's stock holdings and increase its bond holdings. (Bonds usually have a lower risk of loss, though they also tend to have lower potential gains.)
- When a Target Date Fund reaches its target date, the fund doesn't stop investing. That's because Target Date Funds are designed to keep your money invested appropriately throughout your retirement years. The gradual move from stocks to bonds simply continues.
For more information about all of the investments available to you in the LG Health Retirement Plan, click on the "Investments" tab.
Put those extra dollars in your paycheck to good use for your future retirement needs!
Have you found a few extra dollars in your paycheck recently? Perhaps you got a merit increase? Or it could be tax reform (signed into law in December 2017) that led to the extra money, because the federal tax withholding rate recently went down for workers at certain income levels.
If you want to help put that money to good use, why not contribute that additional cash to your LG Health Retirement Plan Accounts? The few extra dollars you contribute today may not seem like a lot—but they can make a difference in your retirement income.
Discover what a difference contributing a few extra dollars can make
Retirement counselor Mike Phyillaier knows what a difference contributing just a little more to a retirement plan account can make with each paycheck.
Mike explains: "About a month ago, I met with a participant who saw her paycheck increase about $30 per payday due to tax reform, but she thought something had changed with her retirement contributions. As we reviewed her pay stub and her account, she was thrilled to find out that her larger paycheck was due to the new tax brackets (that resulted from the passage of tax reform). Together, we explored how she could put the windfall to good use.
"This participant ultimately decided to increase her contributions to her LG Health Retirement Plan account by 1% and use the remainder (about $20 per payday) to set up a vacation savings account. We also discussed how, when she gets a 2% or higher pay raise, she can increase her contributions by 1% and her paycheck would still increase—so she could help herself close her retirement income gap without hurting her take-home pay."
Edition 7: September 2018accordion tab openaccordion tab closed
Get ready to improve your Financial Wellness!
We're pleased to announce that, coming in October, as an LG Health Retirement Plan participant you'll have access to new Financial Wellness tools, giving you:
- A personal financial assessment tool to help you understand where you may need to make a change in your finances
- New budgeting tools to help you track your expenses
- The ability to view all of your personal accounts in one place
- A personalized newsletter you'll receive on a regular basis
Prudential's tools will, in the future, provide to you the ability to add all of your financial accounts, including prior 401(k) plans, IRAs, etc.
You'll be notified when these tools are coming
At least one week before the Financial Wellness tools become available, you will receive an email that the upgrade is coming—but only if you've registered your LG Health Retirement Plan account. Once the Financial Wellness tools have been launched, you'll be invited to upgrade to the tools when you log in to your account.
What one word can help you take control of your finances? Budget!
Do you ever wonder where your money goes each month? You're not alone. Many people have trouble managing their finances. But budgeting your money doesn't require unreasonable sacrifices. It calls for mindful spending and sensible habits.
Step 1: What are your financial goals?
Start by making a list of your short-term goals (e.g., new car, vacation) and your long-term goals (e.g., your child's college education, retirement). This will help you set priorities. With a clear picture of your prioritized goals, you can establish a budget that can help you reach them.
Step 2: What are you spending your money on now?
Before you can create a smart budget, you need to know how you're spending your money today. You can get some of this information from your checkbook, credit card statements, and other receipts. You should also keep track of your cash expenditures for a few weeks—the $3 latte, the $4 magazine, the $6 fast-food lunch. These small cash outlays, over the course of a year, can add up to hundreds of dollars. Once you have that information, divide your spending into two categories: fixed expenses—such as housing, transportation, food and clothing—and discretionary expenses like entertainment, hobbies, and vacations. Don't forget to include out-of-the-norm expenses like holiday gifts, car maintenance and home repairs.
Step 3: Where can you cut costs?
Identify categories where your expenses are high and think about ways you can cut back. Maybe you could bring lunch to work a few days a week instead of going out. Instead of dinner and a movie, stay in and rent a video—or watch a movie on the cable TV that you're already paying for. Small changes can mean big savings, and could free up some money for one or more of your financial goals.
Step 4: What habits can you change?
For example, can you avoid impulse purchases by waiting a week or even a month before buying an item that's not a necessity? Paying off your credit card balance in full every month can free you from interest charges. Making modest adjustments in your day-to-day spending habits can help you find more cash to put toward your financial goals.
Step 5: Remember your goals.
When you're creating your budget, don't forget to include a category for the financial goals you identified in Step 1. You can use some of the freed-up money you identified in Steps 2-4 to start or add to a college savings plan, contribute more to your LG Health Retirement Plan account, or use toward any other financial goal you wish. The right budget can help you plan today for tomorrow.
How a budget put one couple on the road to Financial Wellness
Retirement counselor Mike Phyillaier understands what a difference a budget can make to anyone—of any age.
Mike explains: "Recently, I met with an employee in her 20s who wanted to get a handle on her finances. The problem? She and her fiancé didn't know where to begin. While she explained to me that they both felt totally out of control when it came to money, I explained to her that with some planning and budgeting, she and her fiancé could start taking charge of their financial future.
"So, I sat down with them and held a budgeting and planning session. Together, they decided that she would start by contributing 4% to her LG Health Retirement Plan account (she hadn't been contributing at all). But she didn't stop there, because she also turned on the Contribution Accelerator feature to put regular increases in her contribution rate on auto-pilot. Together, they are now saving approximately $300 per month and will start paying down debt at the rate of $300 per month once her student loan forgiveness payments begin next month. They are also saving for a home and their wedding, which is two years away.
"Budgeting is all about taking control of your finances, and this couple is well on their way to greater financial wellness."