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SENIOR ADVOCATE

By Liza Horvath

 

Olga escaped Nazi Germany and lived in a displaced person’s camp for years until an uncle was able to “sponsor” her to come to the U.S. When she arrived, Olga had only the clothes she wore. Fortunately, growing up in Europe she had attended excellent universities and spoke six languages fluently. Unfortunately, not one of those languages was English.

 

Because of this language barrier, the only work Olga could get immediately was doing housekeeping at her uncle’s hotel in Santa Barbara where she cleaned rooms and washed dishes in the small café. After years of education and a prestigious position in Germany before the war, changing dirty sheets was certainly not what Olga had planned for her life.

 

Sometimes life does not work out the way we plan. Many boomers and seniors who were “wealthy” or at least comfortable before 2009 are now experiencing shock, dismay and disappointment at having lost so much, so quickly. Investment portfolio and real estate devaluations or the loss of a job have forced many to lose their homes, drain emergency savings or withdraw IRA funds – despite heavy penalties for early withdrawal and significant tax consequences.

 

The recent economic recession has been extreme but the fundamental rules of earning, saving and financial success have not changed. For some, the fall they took will result in the recognition that avoiding debt, buying only what you can afford and not using the equity in your home as a piggy bank is, after all, a good way to function.

 

Rather than letting your disappointment devolve into depression and apathy, maybe the time has come to rethink your financial life and begin again. Starting over and committing to remember the lessons learned may result in a much stronger financial future than you ever anticipated. The steps to recovery are the same financial building blocks that were true before the downturn and are true today. First, you must assess your financial position - what you have and how it is invested and insured. If it is real estate, do you have the best mortgage possible? If, during the hard times, you missed payments or had property forecloses there are thirty-year fixed rate loans available to you that are in the 3 and 4 percent range. Check into them and also check your spending – where can you cut corners or reduce spending? Is dry cleaning, a morning latte and a gym membership absolutely necessary? Remember to always pay yourself first – put money into savings for yourself first and do not spend it! Over time you will recover and, with the lessons learned, you will be stronger.

 

In time Olga learned English and was granted a teaching position at the Monterey Defense Language Institute where she fell in love and married. Life, overall, had many challenges for Olga but the strength of character that resulted from living in and escaping war-torn Germany, surviving the camp and working long hours as a maid allowed her to realize that even when life appears hopeless – it is simply an opportunity to hit the reset button and begin anew.

 

Liza Horvath has over 30 years experience in the estate planning and trust fields and is the president of Monterey Trust Management, a financial and trust management company. This is not intended to be legal or tax advice. If you have a questions call (831)646-5262 or email liza@montereytrust.com

 


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