Good habits today will assist retirement

This was originally published on Monday, February 9, 2016, in the Pacific Daily News.  Click here to subscribe to the PDN.

One thing we all have in common is there will be a point in our lives where we will no longer be able to work and will have to start our retirement. Having good habits today will help secure our future.

Life insurance. “Eighty-five percent of the best retirement savers had at least $100,000 in life insurance coverage,” a March 2015 article stated. Talk to your insurance company on which is best for you, whole-life or term-life insurance. Either way, you want to be sure that you are covered in case you become ill, incapacitated or pass away. You do not want to use your retirement money to cover these expenses.

Diversify. Mix up your investments that fit your risk tolerance. Those who are further away from retirement can capitalize in riskier investments than those who are closer to retirement. Having your investment in one type of investment is risky. Don’t put all your nest eggs in one basket. Deciding what to invest in may require some professional help.

Retirement at a dollar amount. When asked the question, “When do you want to retire?” many of us reply with an age. Sometimes we are not ready to retire exactly at 65. Your retirement is about freedom and it would be great to say, “I retired as a millionaire.” Know exactly how much you need to retire comfortably.

Focus on the long term. We put a lot into our retirement investments, and it is hard not to feel some anxiety when we see the market go on a decline. It is important not to panic and do something that you will regret later. Many investors see a dip in the market as an opportunity to acquire more equities at a lower price.

Simple investing. You do not need an expensive and complicated investment portfolio to earn a lot of money. In fact, many of those expensive investment plans come with large investment costs. Those investment costs can reduce the amount of money in your nest egg.

Estate planning. If you own real estate, you should have a living trust that ensures certain people get the assets you want to pass on to them. You should also have documents stating whom you designate as your medical caregiver in case of an emergency. These should be reviewed on a yearly basis.

Review regularly. Take a look at your retirement plan every six months or yearly. Keep track of how your investment is performing. Be adaptive and recognize that the markets change. As your life changes so do your retirement goals. Ask yourself, “Am I contributing enough?” When you re-enroll, take a look at your plan and strategy. Do they still meet your needs? If you see that your portfolio is constantly trending downward, talk to your adviser.

Stay healthy. Your health when you retire is important. As we age, health care becomes more expensive. If you retire in good health, it is likely that your medical costs will stay low and you can enjoy that retirement money.

Never stop learning. Never stop learning about investing and personal finance. The more you know, the more you can prepare for the future.

Professional help. Something as important as retirement should not be left up to guessing. Hire a professional. Taxes, bonds, stocks and other investments are complicated. Policies and laws can change, and you need someone who is knowledgeable. Don’t be afraid to ask your adviser questions. You should be able to trust your adviser and the decisions made.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at and read past columns at the Money Matters blog at


Planning ahead prevents extra heartache after death

This was originally published on Monday,June 16, 2014, in the Pacific Daily News.  Click here to subscribe to the PDN.

Question: I recently went to a funeral for my friend who had been ill for a while. After talking to some of her family members, I found out that she did not leave any direction for her funeral arrangement and worse, no will. Now her children are fighting over her personal belongings, property and finances. My parents are getting up in age and I do not want my family to go through what my friend is dealing with. What can I do to help my parents prepare for their passing?

Answer: My condolences on the loss of your friend, it is never easy saying goodbye to a loved one. It is even harder to see family members torn apart at a time when they should be uniting and consoling each other. Unfortunately, this happens way too often. Many of these arguments can be alleviated if the family member gets their estate in order before passing.

• Life insurance: First, do they have life insurance? If so, does their life insurance cover funeral and burial costs? If not, it is never too late to get an affordable life insurance plan or to add additional coverage to their existing plan. Sometimes life insurance can be delayed and you have to pay out of pocket for the funeral. This can be difficult, especially if you and your family are sharing costs and accurate record keeping is not kept for reimbursement.

• Funeral arrangements: This might not be easy, but sit down with your family and parents and discuss what your parents want at their funeral. This will give you some idea of how much it will cost. Do your parents want to be buried? If so, do they have burial plots? Where do they want to be buried? Maybe they may want to be cremated instead.

Having your family around and taking precise notes of their requests will help alleviate arguments later because everybody will have knowledge about what your parents want. If one of your parents is a veteran, you can try the Veterans Affairs for assistance.

• Estate planning: Most people think that only the wealthy need to have an estate plan. That is not true. Whether it is to divide a 401(k), real estate or other types of assets, an estate plan is necessary. Having an estate plan will reduce the confusion of your parents’ final wishes, give their heirs a piece of mind on who receives your property and assets, and will minimize taxes and legal expenses. If you pass without an estate plan, your loved ones may not receive your assets. The government could keep the assets and you do not get to decide how your property is divided.

These few steps could help lessen the stress that comes from losing a loved one and hopefully any arguments over what is inherited and who inherits it.

Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 20 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at and read past columns at the Money Matters blog at