Dykstra: Slow & Steady

I'm sure we can all remember how we felt when we were young, impressionable and invincible. Our motto was live for the moment; only when the moment was over would we deal with the consequences. There was little, if any, thought about the potential impact on tomorrow -- let alone five, 10, or 20 years down the line.

But thinking about the future is critical to your financial health. Unfortunately, most of us are not adequately prepared to properly manage our finances. Furthermore, many of us are oblivious to the importance of saving and allowing our money to make money. I am particularly concerned about our children's generation; it seems as if it's in a prolonged instant gratification phase, which impacts negatively on building for the future.

Moreover, with the uncertain status of Social Security, a relied-upon source of retirement income may be significantly reduced or potentially eliminated. This will create even greater demands on our children to successfully manage their money and build wealth moving forward.

The fact is, a sliver of the instant gratification phase remains in most of us. We often create debt with purchases houses and automobiles. We have a tendency to believe that our incomes will continue to rise or at worst, remain the same. So as our incomes accelerate, we presumably will gradually reduce and ultimately eradicate our debt. This mentality allows us to purchase and enjoy things that may stretch us to the limit or beyond.

Unfortunately, if we err in our calculations or assumptions, we can be left without the things we cherish the most. Hence, I believe it is imperative that all of us approach our finances in a disciplined, consistent, strategic and healthy manner. We should realize that precious few occupations guarantee an ongoing income stream. More likely, perhaps, many of us will be victims of downsizing.