How To Plan Finances and Manage Investment Risk: The Workbook

Wall Street Two Signs

A story

In 1998, I worked for a large corporation that was merging with another firm. As you might expect, they’re were concerns about layoffs- and the financial impact of those layoffs.

I worked with a guy who had an upper level of income. He had 3 kids and his spouse managed the home. We talked about the potential layoffs.

“Well, I’ve been very disciplined about investing and saving since I started working”, he said. “If there’s a layoff, I’m actually OK, since I’ve accumulated wealth through savings”

I’ve created this workbook so that, someday, everyone can have that same response. We can all get there, with proper planning and education. That’s why I wrote the workbook.

My recent interview with Exit Coach Radio covers some of the points I make in the workbook.

The impact of too much information

Improvements in technology have created a huge disruption in the financial advisory/ investing industry in two ways. First, we now have access to great tools that allow us to invest with little involvement from a financial advisor. It’s cheaper- and the technology makes investing easier all the time.

Technology also means that- like every other topic- we’re overloaded with information. Investors may be confused and frustrated, because they don’t know what to read to be informed. If an investor isn’t informed, that lack of information can have a massive impact on an investment portfolio over time.

A roadmap

After 30 years kicking around the finance and accounting world, I want to make sure that all investors, from do-it-yourself investors to those who rely heavily on financial advisors, have a financial roadmap.

Let’s solve the problem: A workbook that asks you to DO things

This workbook is designed to give you the tools you need to plan your finances and investigate the risks you face in your own investments. This is a workbook. Along the way, you’ll be asked to stop reading and do things. You’ll be asked to write down components of your personal budget, for example. Readers will also be asked to check on certain performance numbers for their investments- and write those down.

This workbook encourages you to DO things….not just read.

I’ve broken up the workbook into four broad categories:

#1: Creating a personal budget, savings

This is the hard part for many people. You can do this on notebook paper, or use one of several mobile apps I’ll discuss. I’ll explain an approach to assess your monthly net income and each spending category. You’ll create a plan to set up a savings account- and tools to stick with the plan over time.

#2: Investment vehicles and risk profiles

Every investment has a level of inherent risk. So, let’s cover the basics:

  • Bonds, credit ratings and the risk of default
  • Stocks: The importance of earnings and dividends
  • Alternative (Alt) investing: Options, commodities and other alternatives

#3: Data you need to understand and manage risk

We’re all overwhelmed with data- in every aspect of life. Looking at investment data is like taking a drink from a fire hose- it will blow you right over. This section helps you identify some key statistics to judge your investment risk:

  • Beta: What it means and how it measures risk
  • VIX: How this indicator explains volatility
  • Mutual fund investment objectives: How a manager’s flexibility can create more risk

#4: DIY investing platforms/ considering financial advisor

There are some great investing tool out there. This section discusses some of the most popular platforms:

You’ll also assess how much time you want to spend on managing your investments. Readers will consider the different types of financial advisors, the services they provide and how they are paid. You’ll decide on how much help you need from a financial advisor

Finally, I’ll touch on the taxation of investments and how taxes affect your portfolio.

How to get the workbook

The complete workbook will be available in February of 2016. I’ll be sending the table of contents and sections of the workbook to people who are interested.

If you’ve like more details as the workbook is finalized, please email me at You’ll get downloadable updates via email.

I hope this workbook can help to plan your finances, understand investment risk, and give you some peace of mind. We should all be in the same position as that investor friend of mine in 1998. Let’s all get there…..

Disclaimer: This webinar is for education purposes and includes my personal opinions. It is not meant to provide specific investment advice. Everyone should consult with an investment professional. The extent to which is up to you.

Best of luck on your investing journey!


Wall Street Two Signs

Terrapin Flyer, Wall Street (CC BY-SA 2.0)

(Visited 24 times, 1 visits today)
Like this content? Sign up for free updates