Focusing Step by Step

Chimorel’s Step By Step Planning starts with the need to get and keep a job. Then, we help you learn to maximize resources like money, time, information and energy. We encourage you to manage the risks in your life and to develop plans to fund the major goals in your life. Finally, we encourage you to plan to add value and satisfaction to your life through planning for college, retirement, travel, charity and much more

Scroll or click to learn.

Step by Step Financial Planning is part of Chimorel’s 735 Lifetime Membership Plan. As you step into a 735 Plan, you bring your unique background, experience, dreams and abilities to the planning process. This is the reason it is important for you to choose the area(s) for your initial Focus. To guide your Focus, Chimorel has established five sequential planning areas called our “Step By Step Plan.”

Career Development & Training.
Resource Management.
Risk Management.
Investment Strategies.
Satisfaction Planning

Formatting Your Focus

We use the following format to help you think through what step is most appropriate for your initial focus:

Reality Check = Your initial Focus might start with the first Reality Check that suggests an area to improve. You can have more than one Focus area, but be careful not to try to focus on too much at once. You will slow down, if you face an overwhelming array of things to do.
Brief Description: Just enough to whet your appetite, but not all that a Focus area involves. We offer a launching pad for your creative imagination.
Services To Consider: Special services will be provided (and developed) on an as needed basis. You are encouraged to make suggestions. You may even want to participate in developing (or marketing) a special service that is important to you.

Payment Suggestions: Chimorel’s 735 Plan offers several unique ways to keep more cash in your pocket. Consider the fraction after each type of payment as a guideline. The types of payment are Cash, Work, Service and Transactions.

Career Development & Training

Reality Check = Are you genuinely satisfied with what you do and what you earn?
Brief Description: Job search, resume writing, part-time/ temporary work, books to study, scholarships, work at Chimorel, Internet Search.
Services To Consider: (1) Search websites with you, help you create and send a a targeted resume. (2) Grant & Scholarship search. (3) Training in resume writing, interviews, search techniques. (4) Job referrals. (5) Employer job bank, (6) Professional Development Course, (7) I Got a Job program.
Payment Suggestions: 2/5 Cash | 2/5 Work | 1/5 Service

Resource Management

Reality Check = Money 1:Do you consistently save & invest 10% of your income after taxes? Money 2: Do you plan your contributions or give spur of the moment? Time & Energy: Do you have time and energy for the people you love and for supporting others?
Brief Description: Are you maximizing the three precious resources of cash, time and energy with strategies like Recycling, purchase techniques, tax & expense reduction, good nutrition, exercise and proper health care.
Services To Consider: (1) Bill paying. (2) Credit management. (3) Cash & time management training. (4) Charitable and volunteer strategies, (5) Wellness strategies, (6) Budgeting/bill paying work sheet, (7) Yoga, pilates, strength training, diet, exercise.
Payment Suggestions: 2/5 Cash | 1/5 Work | 2/5 Service

Risk Management

Reality Check = Do you know what your plan is for the major risks in your life?
Brief Description: Life is full of risk. Identify your risks. Decide to reduce, avoid, shift or assume each major risk. Develop an ongoing habit to identify and manage each significant risk you encounter.
Services To Consider: (1) Initial risk evaluation, (2) Development of risk management strategies, (3) Insurance, (4) Will & estate plan review, (5) Ongoing risk management evaluations.
Payment Suggestions: 1/3 Transactions | 1/3 Cash | 1/3 Service. Note: transactions depend on many external factors, which may mean 1/2 Cash & 1/2 Service, if you only use Chimorel programs.

Investment Strategies

Reality Check = Do you have a plan to fund the major goals in your life?
Brief Description: Do you make your own investment decisions or hire professional management? Do you understand liquidity, investment risk & return ratios, security types, exchanges, insider regulations, asset allocation. Do you have an adequate retirement plan?
Services To Consider: (1) Retirement Plan Estimate, (2) Review of current portfolio/investment strategies, (3) Asset Allocation Review, (4) Development of investment strategy alternatives, (5) Computer search of property records, mutual funds, all listed stocks.
Payment Suggestions:1/5 Transactions | 3/5 Cash | 1/5 Service. Note: transactions depend on many external factors, which may mean 1/2 Cash & 1/2 Service, if you only use Chimorel programs.

Satisfaction Planning

Reality Check = Is life good for (1) you, (2) the people you love, (3) the world you live in?
Brief Description: Success is the journey, not the destination. As you achieve some goals, plan new ones! Build the house of your dreams. Travel. Plan your estate. Retire comfortably. Get your kids through college. Make the world a little better because you were here.
Services To Consider: Develop plans for (1) college funding, (2) traveling, (3) building or remodeling your dream home, (4) your estate, (5) charitable intentions.
Payment Suggestions: 2/5 Transactions | 2/5 Cash | 1/5 Service. Note: transactions depend on many external factors, which may mean 1/2 Cash & 1/2 Service, if you only use Chimorel programs.

At the beginning, your first step, assuming you have a job, should be to eliminate all of your debt and establish an emergency fund. This may not have been what you expected, but if you have high interest debt eating away at your life and an emergency happens life gets complicated.

Create an Emergency Fund

If you are one of those Americans with about $100 extra at the end of the month, this month put the entire $100 into a savings account. Now you have established your Emergency Fund. You will probably want to put $2000 or more into this fund as soon as you can, depending on your income level, but now the fund is established. Most likely you should build your fund to cover approximately three m onths of expenses, or at least three months of those expenses that you absolutely have to pay.

Now look around the house, in the attic, in the basement and in the garage. What can you sell? Add this amount to your Emergency Fund. You can have a yard sale or learn how to use eBay. Learning about eBay is one of the suggestions we will have for developing extra income. Chimorel holds periodic auctions and garage sale events. You can participate in one of these events.

Click the yellow link for Buy Stuff and learn about Chimorel Bucks. As a Chimorel Client, you can use Chimorel Bucks to establish a Chimorel Emergency Fund or you can use Chimorel Bucks to pay certain expenses.
What do you pay a monthly payment on that you could do without? Can you get rid of that payment on your motorcycle by selling it? Can you trade a $400 car payment for a $175 car payment. Do you need to sell your home with a $1000 payment and buy one with a $500 payment? No, you really don’t need to sell family heirlooms or antiques.
At the beginning of our Eliminate Debt program, we tell you that the program is tough, real and doable. Be prepared for “I-feel-sorry-for-myself” moments. Just tell those moments to “Your not helpful!” and they can fade. Then continue with your program. Before long you will be debt free and you will have more money to pay cash for all those things you are doing without right now and will be able to negotiate lower prices with cash in your hand. Add part of your savings to your Emergency Fund, use the remainder to begin paying off your debt.

Debt List Form For

Your Name Goes Here

Create an Excel spreadsheet with the following headings: Whom I Owe | Rate | Balance | Amt/Mo. When you become an Action Planner or enter our 735 Plan, we will provide this spreadsheet with more columns.
In the Whom I Owe column, list everything you owe. Don’t forget anything. Enter and pay attention to the APR (annual percentage rate) and the Balance. Pay off the highest rate or lowest balance first. Then add this payment to your next highest rate or lowest balance and continue to eliminate your debt.
As a 735 Plan member you will receive an Excel spreadsheet with the Debt List and Solid Budget Forms on a flash drive as part of your 735 Plan.

Solid Budget Form for

Your Name Goes Here

Create an Excel spreadsheet with the following headings: Category | % Lo | % Hi | Mo 1 | Mo 2 | Etc | Year. Again, as you move from an Action Planning membership to Step by Step Planning with your Lifetime 735 Plan, you will receive this spreadsheet as one of the benefits available.
Under Category make rows for Income, Inflexible Expenses and Flexible Expenses. Under Income list rows for each Salary, all other income and Total Income. Under Inflexible Expenses list rows for Savings & Investments, Tithes Offerings Gifts, Debt Reduction Credit Cards, Housing, Insurance and Total Inflexible Expenses. Specify individual items under each of these categories. Under Flexible Expenses list rows for Food, Transportation, Clothing, Education & Childcare, Medical, Entertainment, Miscellaneous and Total Flexible Expenses. As appropriate, specify individual items under each of these categories.

How Do I Use the Solid Budget Form?

Based on your actual spending, you will want to add many rows to track the details of your spending patterns. Use a spreadsheet to add columns for an entire year and separate sheets to track budgeted vs actual. Your budget should begin by tracking actual expenses for at least three months. It will evolve into a “planned budget” which you will compare to “actual expenditures.” We provide this spreadsheet as part of your 735 program.
Below we discuss the items in the Category column. At the beginning use the form to track your actual expenditures. Before you fill it in, copy it to another spreadsheet so you have a blank form for your budget. Add columns for additional months. Add rows to enter the detail under each main category As a client we will help you with this.

The % column shows suggested percentages (low and high) for each category. Don’t exceed the high percent. Except for Savings and Investment, probably Tithing and probably Entertainment, feel free to spend less for a particular category as appropriate for your circumstances.

Income

In time you will want to diversify your income sources. It is to your advantage to have at least three sources of income. By developing multiple streams of income you protect yourself against a variety of perils – like disability, economic conditions and the loss of a job. As you become an Action Planner and 735 Plan Lifetime member, we will open the doors to many income alternatives.

Inflexible Expenses General

Inflexible expenses are those expenses that you decide once and they continue for several years or longer, like the thirty year mortgage on your house, the lease on your apartment, your commitment to eliminate debt, your tithe to your church and the savings for your retirement. Inflexible Expenses are not completely inflexible. You can buy a less expensive house, increase the amount for your retirement program and eliminate your debt; thus reducing, increasing or eliminating amounts allocated for these expenses.

Flexible Expenses General

Decisions about most flexible expenses could change from month to month or should be eliminated as quickly as possible. The amount you spend for food may be fairly stable month to month, but you can decide to buy chicken or steak, skip the ice cream or fast food for a few days.
You want to eliminate your car payment asap and in the future pay cash for your car. You might defer car repairs until next month or dip into the emergency fund. Once you have a basic wardrobe, suitable for work, you can postpone clothing purchases for awhile and tell the kids that the $100 jeans comes out of money they earn. You can defer educational costs temporarily and arrange with relatives for childcare; or these costs could become inflexible expenses. At a young age you may be able to defer most medical costs. At an older age medical costs may become inflexible. You have significant discretion over entertainment and miscellaneous costs.

Detail for Inflexible Expenses

Savings & Investment 7-15%

Pay yourself first. Make a decision to develop an emergency fund of at least $2000, better 3 months of expenses. Once you have funded your emergency fund, keep making decisions to save and invest. If possible create a 401k at work or through Chimorel. Establish an IRA. Start a business and create a retirement program. Work for Chimorel and create a retirement program. It is best to establish tax sheltered vehicles for your investment program whenever possible.

At the beginning you may not be able to save 10% or more, but set a goal of at least 10% of your after tax income. As you receive raises, reduce your debt, and develop additional streams of income keep increasing the amount you allocate to your investment program. Before long you will have a pattern of consistently saving and investing 10% or more. For your budget specify each savings/investment vehicle which you allocate money to on a regular basis. Did you catch that word pattern. This is one of those habits you really do want to establish.

Tithes, Offerings, Gifts 5-15%

       You may be asking, “Why aren’t gifts a flexible expense?” There are at least three answers. If your religious values are strong, you already know the first answer. God multiplies your tithes and offerings based on the sincerity of your heart. See below for more.
       The second answer is similar, but not necessarily based on your current religious values. There is something powerful and dynamic that happens when you give, not based on your own self-interest. Once you establish a pattern of giving generously with an intent to improve the lives of others you release powerful, universal forces. See below for more.
       Thirdly, there are significant tax advantages available to you when you begin a planned giving program. See below for more.
       Of course, there are also Christmas, birthday and other gifts, but this type of giving might be more appropriately classified under Miscellaneous expenses.

More About Giving

       Giving Based on Religious Values:  When you give time and money based on religious values “with a pure, sacrificial heart” good things happen. It is not the amount you give but the attitude that really counts. You may see part of this giving as your debt to God. Another part may be your desire to support others. If your gift is based on being multiplied back to you and given out of your surplus, the multiple may be fairly small. If your ongoing giving is released by an attitude of service to others and God, as well as by genuine generosity, the multiple can be quite significant. When you begin to “tithe” be less concerned with the amount and the multiple and more concerned with the attitude of your heart. In time the multiple will make it easier to approach 10% plus additional offerings. Again do not be concerned if the percent of your giving is based on gross or net or whether it is .5%, 10% or 90%. Focus on generosity, sacrifice and the attitude of your heart. If your giving is based on religious values, give what God leads you to give and ask Him to increase your ability.
       Universal Giving: Giving because it is a good thing to do may or may not be based on religious values. Focus on how your gift can support others. Sometimes the gift of your time is as meaningful as the gift of your money. The power released may or may not increase your riches, but it will increase your wealth. See Riches vs Wealth. After pondering why events like Katrina, tsunamis and earthquakes happen, think about the outpouring of generosity that frequently takes place after these events and reflect on the power of universal giving.
       Tax Based Giving: A husband and wife can give $20,000 each year to each child without incurring gift tax. You can give appreciated stocks and other property to charity, take a charitable deduction for the appreciated amount and incur no gift tax. You can set up a charitable remainder trust, which pays an income to you or others, receive a limited charitable deduction and not incur a gift tax. This is not the place for an extended dissertation on tax based giving, but it is important to note that there are significant ways to reduce your taxes by giving

Debt Reduction 0-25%

Obviously this section is about getting rid of your debt. The list you specify under this category will include every debt you have. Put your highest interest debts at the top of the list and allocate the greatest amount possible to the highest interest debts. When the higher rate debts are gone work down the list until they are all gone. Or, get rid of smaller debts first, then work your way up to the biggest debts.
To the degree possible reduce all your other categories and increase this category. Then get rid of your debt so that this category is zero and reallocate the amount to categories like Investments, Tithing, etc. according to your values. As long as you keep the Debt Reduction/Credit Card category at zero, you can negotiate better prices for cash and use the interest you would have paid to have or give more.

What Do I Do?

When you are trying to eliminate debt, it is easy to struggle with the questions “Shouldn’t I be tithing?” or “How can I save 10% and pay off my debts too?” The answer to the saving question is easy, be sure you have an emergency fund, then focus primarily on eliminating debt. You will save much more in the long run by getting rid of high interest debt. Then increase your savings program.
The tithing question is tougher, but here again you will be able to give much more in the long run when you eliminate your debt. If you believe God will multiply your giving with a pure heart, test it. Give more and watch the multiplication. If it doesn’t happen, you may need to work on the pure heart part for a while. While you are working on the pure heart part, focus on eliminating debt and not on the multiplier. Listen carefully to what God seems to be saying. Then test it and determine what is real in your life at the moment. Once again if the multiplier does not give you more to pay off your debt, work on the pure heart part and pay off the debt. Then you will have more to give sooner.

Housing 15-35%

       Housing is usually the biggest category. Include your house payment (a debt) or your rent payment. As quickly as you can it is to your advantage to move from renting to owning for most families. Chimorel has programs to make this possible, as long as you are willing to work.
       Your specific housing list may also include repairs, utilities, a down payment fund and other items related to having or getting a place to live.
       Before you allocate a lot to housing, get rid of your credit cards and other debt. While you are eliminating debt, try to keep your housing costs toward the 15% side, if you have a choice

Insurance 2-7%

Insurance is part of your risk management program. In the long run you want to have less insurance and more savings. This means higher deductibles, lower premiums for high quality insurance, coverage at higher levels with savings/investments to cover the gap between the higher level and the deductible. In the short run it means less total insurance, covering major risks only, protecting against perils that would create a disaster if they happen.
You must cover your car and house. You should have a minimum of $100,000, preferably more on your life. You will want disability as soon as possible. Medical coverage can be initiated with supplemental, reasonably inexpensive coverage. Then work for a company that provides good coverage or with Chimorel and get the coverage you will need. As you begin to approach 45 to 50 be sure to consider long term care and something other than term life. The earlier you start, the lower your annual premium, but the more total premium paid over time. In time you will want to explore comprehensive risk management with Chimorel. If you are exceeding 7% for insurance, reevaluate.

Detail for Flexible Expenses

Food 7-12%

Eating out regularly is a food expense. Shop the walls of a grocery store for food basics. Reduce your purchases from the aisles where the higher profit items are usually located. Buy healthy food, not snacks. You will spend less on food lower on the food chain (grains, fruits, vegetables) and more on prepared food.

Transportation 3-8%

If you can walk, ride a bike or take the bus, you will save. Transportation includes buying a car, maintenance and repairs, gas and oil and bus tickets. Be aware that having a car will always cost you at least $200/mo, including the cost of the car, gas, insurance and repairs. If you earn less than $2500/mo after taxes and have a family you can’t afford a car.

Clothing 2-4%

Buy basic clothing that you can mix and match. A stitch in time saves nine. Jeans come in $20 and $120 varieties. Buy clothing on sale, not designer clothes. Thrift stores are a great place to shop. Nuff said?

Education & Childcare 4-12%

Education and childcare might move to the inflexible expense category, depending on your situation. Home schooling is less expensive than a private school and may make sure your children truly get a great education. Can you get relatives and friends to help with childcare? Can you coop childcare so that five friends cover child care (Mon, Tue, etc.) with each working ten hour days the other days? Ask about our Forest School program.
On the education side, there are many ways to pay for college. You will want to learn about Chimorel’s College Bound program. Not everyone needs to go to college, but everyone needs to get the appropriate training.

Medical 0-7%

Medical expenses can also become an inflexible expense. Working part-time with Chimorel is one way to get medical coverage. Find out about Medical Savings Accounts, to pay for medical costs with pretax dollars. What drugs would you be better off without? Learn about Chimorel’s Hospital Planning program. For people who are not in later stages of a disease, we can suggest some natural/food supplement and strength conditioning alternatives.

Entertainment 2-5%

Have fun, enjoy life, but learn to walk in the park instead of going to a rock concert. Yes, you can do without cable. Maybe you and other members of your family could get part-time jobs instead of watching TV. Develop a pattern of doing joint family, inexpensive fun things rather than solitary, expensive things.

Miscellaneous 0-3%

The fewer miscellaneous items you uncover in your spending pattern the better.

       Do you get a substantial tax refund at the end of the year? Change your W4 so that you receive a $200 refund instead of a $3800 refund and add $300/mo to your ability to pay off your debt.
       Buy the least expensive, quality insurance possible. Increase your deductibles, but make sure your cash reserve will cover the higher deductible. Shop your insurance to get the best rate for the coverage you need. Buy term and use the difference to pay down your debt, but before you are 50 develop adequate savings or move to Universal or something other than term. Use the cash value of an existing policy to build your cash reserve or pay off debt. Don’t terminate a policy until the new policy is in your hands. When possible, be sure a medical condition does not keep you from getting the coverage you need.
      Trade your low yielding bonds and savings accounts for your high interest debt. Eliminating a 21% interest rate is a better investment than a poorly performing stock. Temporarily stop adding to your 401k, unless your employer’s match is over 50% or your tax bracket is high enough to warrant continuation.
       You can live without cable, nail care, expensive restaurants, memberships and magazines. Home school instead of a private school or go to a state college instead of a private college. Restructure your business to take the maximum deductions possible.
       Every $50/mo you save can mean $80,000 in 25 years at 11%. Just think what it could mean in reducing your 21-30+% debt load. This suggests paying attention to many small details can pay real dividends.
       Minimize speeding and follow parking rules. Tickets are expensive. Tickets and accidents increase insurance premiums. Speeding uses more gas. Shop for car insurance and take advantage of discounts for low mileage, safety features and alarms. Pay attention to gas prices and keep your RPMs below 3000. Find a good, honest mechanic who does not inflate rates or recommend unnecessary work. Rotate tires, keep them properly inflated. Walk, carpool or take the bus. Follow your maintenance plan. Change oil regularly. Verify that your insurance covers rental cars and check no on insurance when renting a car. Buy new/used cars at a discount. Ask us how.
       Take water and/or coffee to work or get your employer to provide. Take a trip to the water fountain instead of buying a snack. Brown bag or take leftovers instead of buying lunch. Invite friends to a potluck at your house instead of eating out. Use restaurant coupons. Turn the thermostat up in summer and down in winter when you’re away. Insulate the water heater. Turn it down when you’re away.
       At the supermarket use coupons and buy on sale. Cook more than you need and freeze half. Un-thaw and reheat instead of eating out. Eat homemade soup. Cook from scratch periodically. Cover your pots to save energy. Re-engineer leftovers. Freeze aging bananas, then make banana bread when you have time. Rework recipes rather than running out to get ingredients. Use 1/2 pound of beef instead of 1 lb. Grow your own food. Eat more vegetables, less meat. Make your own cleaning agents. Bleach in a squirt bottle, instead of Tilex. Vinegar and water, instead of Windex. Use all the toothpaste in the toothpaste tube. Wash and reuse Ziplock bags. Do your own home maintenance.
       Don’t smoke, drink or use drugs. Exercise more, shop less. Watch exercise programs on TV instead of buying an exercise video. Tune in to what you spend on various activities and eliminate expensive habits. For example, buy less expensive golf clubs and play cheaper courses. Take up hiking or gardening. Turn a hobby into an income source, like woodworking or writing. Use the library instead of the bookstore. Go to cheap theaters. Reduce, reuse, recycle. Use a wish list, instead of a shopping list. See if the urge passes. Barter instead of buy. Ask for discounts and sales. Negotiate lower interest rates on your credit cards or change cards.
      That maybe enough for now. If you want other ways to reduce expenses, review Reduce More Expenses below. When you become a Chimorel client, we can teach you many other savings tricks and give you websites to visit to learn more.

Reduce More Expenses

When we Googled Reduce Expenses, we uncovered these links. Depending on when you are reading this you may find these links or other ones.

21 ways to reduce expenses
Wiki How Reduce Expenses
Tackling Our Debt

You can use Google or another search engine anytime you are looking for more ways to reduce expenses or to do something else.

       In the long run, increasing your income will help at least as as much and probably more than reducing your expenses. Let’s start with a few obvious possibilities. If you don’t have a job, get one. Any job is better than no job. As quickly as possible move in the direction of a job that makes you happy, fulfills your life purpose and pays more than you need to pay your bills.
        If you have a job, get a raise or get a better job. Get a second job. Start a business that actually makes money. Stay with your day job until the business is making more than you make on your day job and the opportunity to continue to grow is real. If you want to explore additional ways to Increase Your Income, start your free Success Journey, where you can learn about more than 100 ways to increase your income.
       Enabling you to uncover income opportunities is one of the significant ways Chimorel can enhance your life. We are only going to make a few suggestions at the moment. You can explore many other areas of the website and will eventually want to become a member or join a program.
        Explore our Cooperative Effort program. Investigate the many “work at home” possibilities, but be careful. Many work at home alternatives tend to spend more money than they earn. If you have the right personality, there are hundreds of multi-level opportunities. Once again, be careful. Many multi-level alternatives reward a few, while the multitude do all the work. Learn to buy real estate. Again, be careful. It is harder and riskier than the promoters tell you. Start your own business. Again it is harder and riskier than it might seem.
        If you genuinely want to increase your income, we will support you. If you don’t mind volunteering some time to learn and have some marketing talent, you can become a Chimorel Resource Developer. Chimorel Resource developers can earn perhaps $15,000/yr part-time and over $50,000/yr full-time. Once again, be careful. You could spend a lot of time and not earn much, if you don’t have the right combination of concern for others, organizational skills and marketing talent.

Learn More About Comprehensive Planning

       Warren, Chimorel’s Executive Director, is a former Certified Financial Planner who established Amerivestor Associates Inc, a stock brokerage and investment advisory firm, and who was licensed to sell life, health and property insurance. At one point in time he was also a real estate agent. He is no longer a CFP, investment advisor, stock broker, insurance agent or real estate agent because maintaining these certifications takes away from time spent actually supporting people and for the reason described below.
      Warren came to believe that being a broker was far too much like being a con artist. There are, undoubtedly many good, ethical certified financial planners, stock brokers, insurance/real estate agents and investment advisers. Nevertheless, after watching the near meltdown of the financial markets led by some of the top brokerage firms and banks in the country, he decided not to continue to remain in this field.
       This is not to say that you don’t need to do financial planning, make investments or buy insurance. You absolutely do need to do these things. At the same time you need to be very much aware of the products and services that can deplete your savings instead of providing a comfortable retirement. This means that you must become informed as you seek the services of financial advisors.
Perhaps in the future Warren may reestablish some of these credentials or develop relationships with highly ethical affiliates.

Reality Check = If you are currently evaluating the need for comprehensive planning, consider these four questions:

Do you get what you pay for, or do you pay for what you get?
Is it less expensive to hire a fee only planner (then pay transaction costs) or to pay commissions only (then hope for good advice)?
Does a Comprehensive Plan lead you Step by Step through actually achieving your goals?
Are there alternatives that can help you when you need it, but keep your out of pocket costs as low as possible?

Chimorel Belief: You pay for what you get.
Comprehensive Planning should lead you step by step to achieve
your goals. You must take the steps to be sure that it actually does.
There are effective alternatives to fee only and
commission only planning that can support when needed,
yet keep your costs as low as possible.

Sample Comprehensive Financial Plan Fees

Description: Financial planning of some kind is offered by many vendors. Fee Only Planners frequently offer a Comprehensive Financial plan for a substantial fee. If the advice is good and you follow the advice, the fee may very well be worthwhile. A typical fee schedule might be similar to the schedule on the left.
Obviously, you could find a firm with higher, lower or a different fee structure. As you read through the following, you could decide that the fees for a comprehensive financial plan are too high. If you are not willing to take the time to understand the background behind financial planning, we don’t want you to avoid doing a comprehensive financial plan. We strongly encourage you to learn enough to be able to evaluate the advice you get, seek to maximize your actual investments and minimize your fees.

Services Provided: When you do a comprehensive plan, you will be asked to:

Provide complete up-to-date information about your personal, financial and investment circumstances and objectives through a series of forms. Chimorel’s Step by Step plan can provide these forms and the clarification in #2.
Clarify this data in interviews and notify your planner of changes in your circumstances or objectives.
Analyze your present financial situation, which can include a review of your assets and liabilities, your current and projected income, your current insurance program and risk management strategies, as well as, your investment portfolio and current investment strategies, as appropriate. Rather than doing the analysis for you, our Step by Step plan can teach you to do your own analysis.
Detail separately in a “Specification Sheet” additional services – such as business development & financing, assistance with home construction or remodeling, or developing a college funding program. Each area is a program that actually supports you to achieve a particular goal.
Accept a series of written analyses and recommended actions, and coordinate this analysis into a Comprehensive Financial Plan. This plan will refer to such things as the holding or sale of securities and other assets, your projected income, projected cash flow, projected tax consequences, retirement planning, estate planning, and insurance planning. You should complete each recommendation to coordinate your comprehensive plan effectively. Again, we can teach you how to do this and how to question your advisors and coordinate your own plan.

In addition to the above, the following will be important to complete your Comprehensive Plan.

Your planner should keep confidential all information provided by you and all recommendations and advice furnished to you, except as agreed in writing or as required by law.
When you receive this series of documents, you should confer with any other advisers, and attend to the completion of such forms and agreements as may be needed to accomplish your objectives.
You should implement acquisition of such investments, real estate, insurance or other products as you may want to acquire.

The services above should be included in any comprehensive plan you choose. To the degree possible your fees should be paid at least in part by transactions you complete, but you do not want to just complete transactions without knowing what transactions are actually in your best interest. When you learn what is in your best interest, you can make these decisions. If you don’t want to take the time or responsibility to learn, you must hope that the advice you receive comes from a person with high integrity.

Consider the Cost for a Fee Only Planner

You have just completed a Comprehensive Financial Plan with a fee only Planner. You intend to retire in 20 years. Your income is $80,000/yr. You have $700,000 in assets, $250,000 of which are in 20 no growth stocks earning 3.5%/yr and could be repositioned to earn 7%. Your fee for the plan is $2500. Now it’s time to execute the recommended transactions. Repositioning the stock generates commissions (sell 3½% & buy 3½%) of $17,500. Total cost $20,000. You also buy some insurance which generates another $3300 in commissions.
Because your planner is fee only, he/she earned $2500 and referred you to a friend who earned the other commissions. Or perhaps he/she is licensed and shares in the commissions, in which case he/she is not exactly fee only and has a fiduciary duty to disclose this to you.

Chimorel Alternative

       Using concepts learned in Chimorel’s 735 Step by Step Plan and an online broker, the asset changes can be executed for $440 (20 stocks at $11, buy & sell). With the right online broker these transactions can actually be executed for free today. Your $735 initial membership fee includes access to the Chimorel Cooperative. Over the next 20 years your membership in the Chimorel Cooperative saves you an average of $3000/yr.
       You plan a $100,000 addition to your house, which we teach you how to complete for $85,000. Over a 20 year time frame this saves you another $20,000 in finance costs and income taxes for a total of $35,000. We show you ways to save money in planning for college, estate planning and other areas. We teach you ways to add to your income, but let’s stop at this point.
        At this point we have saved you some significant expenses. $19,560 can be invested now: $17,060 from securities (potentially more) and $2500 Comprehensive Plan. $35,000 can be invested over 20 years as you pocket the money you would have spent in mortgage payments, say $1750/yr. $3000/yr from the Chimorel Cooperative is $60,000.
        Let’s invest $15,000 now and $4000/yr at a conservative, compounded 7%. Twenty years from now you would have $220,000. If you continued to save $2000/yr through the Cooperative and withdrew $10,000/yr (net withdrawal of $8000) for another twenty years, you would have spent $160,000 and accumulated a total of $503,000 to leave to your children. Then through sound estate planning our affiliate advisors enable you to save $150,000 to $500,000 in estate taxes.
        Let’s hope you got a lot of good advice for your $2500. Probably the most important two things to learn from the discussion above are (1) learn to save on broker fees and getting investment advice and (2) uncover ways to save money which you can invest. Once you implement your 735 Plan Lifetime membership, we will start where ever you need to focus and support the steps you take to achieve your goals.

Could You Run That By Me One More Time?

       Sometimes when someone crunches a lot of numbers in print, it gets confusing. Let’s make it simple. The example above says that at Chimorel the cost of a Step by Step Plan and repositioning assets was $440, instead of a total of $20,000. You also bought insurance which generated $3300 in commissions which we are not evaluating at this point. This gives you a savings of $19,560, ;otentially more. We then talked about additional savings you could generate through our Home Builder program and by using the Chimorel Cooperative.
       When you invested most of the savings you ended up with an additional $220,000 by the time you were ready to retire. When you retired you continued to save through the Cooperative, and began withdrawing a net of $8,000/yr to spend as you wanted. After spending about $160,000 over 20 years (in addition to any other retirement plan and social security), you have $503,000 (plus any other assets you may have) to leave to your children. Your estate planning enables your children to receive their inheritance without excessive probate cost & taxes. We thought that you might appreciate what a 735 Plan could do for you.
       Again crunching numbers in print can be confusing. The real point is that you can save a lot of money using Chimorel’s 735 Plan.

Broker’s Commission

       A commission of $17,500 to execute the equivalent of 40 transactions is quite excessive. Broker fees can range widely. A broker might charge as little as $25 or as much as 5% to execute a transaction and today you can execute transactions for free. We based the fee on 3.5%, which is still quite high, but if you haven’t learned how to choose a broker it might not be excessive, depending on the kind of stock you bought and the broker you used.
       We assumed you had 20 stocks to sell and that you bought 20 stocks. We based our on-line trading fee on $11/transaction. You can pay more or less than this amount, depending on your on-line broker. 40 transactions at $11 each is $440.
       The difference between $17,500 and $440 is $17,060. This plus the $2500 fee only planner’s fee is $19,560.

Focusing Step by Step

Our Step by Step Financial planning is not yet what we call button clicky. At this point you will participate in group discussions to learn the information for each of the five steps, as part of our Change Your Life Program. If you are willing to participate in making things “button clicky” you can earn part or all of your 735 Plan. For example, several people are currently doing the Create a Career program (Step 1, Get a Job) for free in exchange for reviewing the program with the intention of making our flash drive better and more “button clicky.”
Each step will follow a similar approach. To refresh the five steps are: 1. Career Development & Training, 2. Resource Management, 3. Risk Management, 4. Investment Strategies, 5. Satisfaction Planning.