*Oaktree Financial Advisors is neither endorsed by nor affiliated with Eli Lilly
We all have busy lives and because of that we all have things that we should be doing that don't get done. Even with the best of intentions to do these things we run out of time or forget or sometimes maybe we just don't even realize we should be doing them.
With that in mind, here is a list of four things you should know about if you are an Eli Lilly employee.
1. 7 Times Your Salary Is Not Enough Life Insurance - Lilly provides you with two times your base salary in life insurance and you can purchase up to an additional five times your base salary. I think sometimes people think that since they are purchasing the maximum they can that that's enough. It's probably not. Life insurance should be the foundation of your financial plan, not an afterthought or an add on. Protect your family by making sure you have enough life insurance. How much is enough is best determined as part of an overall financial plan, which leads us to number 2...
2. Investing Without A Plan Is Like Driving Without A Map - Imagine this conversation: Dad: "Okay kids, we're going on vacation". Kids: "Where are we going dad?" Dad: "Not sure. I'm just gonna start driving and see where we end up." At some point you've got to look at a map. You've got to look up and see where you're heading and plan how to get where you want to go.
The same goes for your investments. You probably started contributing at least 6% to your Lilly 401(k) because that's what the company will match. And you chose investments way back when by some method - or maybe not by any method, but you still chose them! But you may not have looked at it in years and you're not really sure if you'll have enough money to retire with the lifestyle you want. You know where you want to get to - retirement. You need to develop a plan to get there. Don't just throw money in your 401(k) and hope it all works out.
3. You Can Auto Increase Your 401(k) Every Year - It's easy to lose track of how much you are contributing to your 401(k). Too many times the initial contribution percentage is chosen arbitrarily and is not updated. Years can go by without any changes to the percentage. The maximum that can be contributed to a 401(k) for 2015 is $18,000. Employees age 50 or older can contribute an additional $6,000 for a total of $24,000. If you are not contributing the maximum allowed you should elect the auto increase option for your 401(k) contributions. With this option you choose your starting contribution rate, the annual increase percent and the target rate. Your 401(k) contribution will automatically increase by the chosen annual increase percent every year until the target rate is reached. This will help you to increase your savings without having to remember to do it every year.
4. Don't Wait Until Age 50 To Start Planning - The earlier you start planning the better. I often have people tell me that they regret waiting as long as they did to go see a financial planner. This is probably one of those things that people just don't think much about until they get older or they just keep putting off. Go see a financial planner. Meet with a few if you need to. It shouldn't cost anything for an initial meeting. Find a planner that you trust and is a good fit for you and hire them with the intention of keeping that relationship forever. Because if you go into it thinking they might not be a good fit, it's not the right planner for you. Once you do that you can be confident that you'll have a trusted partner in your journey towards and into retirement and beyond.