Are You Gambling with Your Financial Future?

The multi-state Mega Million lottery reached a record jackpot over the weekend when Friday’s lucky numbers went without a winner. Lottery officials expect Tuesday’s jackpot to reach $2 billion, and folks everywhere fantasize about what they'll do if they win.

There’s nothing wrong with spending a few dollars now and then on lottery tickets. It’s a different form of entertainment, like going to a movie or having a few beers at a local watering hole, provided it’s done in moderation. I even bought several tickets to share among friends who gathered at our home on Friday night. Our group had fun joking about whether they knew a financial advisor who could help them should they hit the big payoff. I think I know a guy!

Gambling and financial planning both involve managing risk. With the lottery, although there are smaller prizes for partially matching winning numbers, it is basically a zero-sum game…there are one or two huge winners and everyone else loses. The odds of success are astronomical, and those playing the lottery know that going in. There’s really no way to plan, you are simply a prisoner of the luck of the draw.

Financial planning, or more specifically retirement planning, involves a much different risk equation. The range of outcomes are variable, as are the risks. 

For example:

• you might die prematurely or live well beyond normal life expectancy  

• your employment ends or your earnings decline unexpectedly

• you might face unexpected expenses caring for an aging parent

• your investment portfolio might not yield the returns you expected

These are just a few of the possibilities one faces in managing their financial future. It’s not a zero-sum game; there are myriad possible outcomes. The key is to develop a plan that enables you to have a successful outcome even if there are unexpected bumps along the way. According to the 2017 Retirement Confidence Survey conducted by EBRI, only 18% of workers have a financial plan.

Doesn’t it make sense to partner with a professional advisor who can help you navigate and explore the range of possible outcomes before they occur? And whether you hit the lottery or not, I think I know a guy!

#lottery #MegaMillions #MondayMorning #retirement #financialplanning