DOLLARS AND SENSE

TAKE YOUR OWN PERSONAL STRESS TEST

Just as the Obama Administration has given a stress test to the nation’s largest banks,  it behooves us to take our own personal stress test.  The bank test was given for the purpose of determining how well these institutions will hold up if the economy further deteriorates.  Your personal test will give you a snapshot of how well your personal finances will do in tough economic times.

CNNMoney has put together such a test (find it at http://cgi.money.cnn.com/tools/financialhealth/index.html).

I tried it and I liked it for these reasons:

·         It is quick and simple.   I hate anything that smells like a survey, so I was pleasantly surprised by the simple questions.  I completed the test in less than five minutes; not bad for something this important.

·         Well rounded categories.  Specifically, this test includes retirement savings, housing payment, debt, emergency savings, diversification, company stock and life insurance.  While the category “company stock” didn’t seem to fit (hint: don’t buy any), the others are all essential for personal financial planning.

·         You get graded.  Well, not everyone likes grades, but if we want to know the truth, we need objective analysis to tell us what we are doing right and what we need to improve on.   The grading is set up to give you a mark of “A” through “F” for each of the above categories, as well as an overall grade and a recommendation of what you need to work on.

We are living in challenging times.  Stressful times.  Some of you worry warts may be taking on more stress than you should.  For you, this test may allow you to relax a bit and actually have a life.  Others of you are drifting through life like Gomer Pyle on valium, naively believing that all will magically work out whether you have a plan or not.    This test will serve as your wake up call.  You and only you are responsible for your financial well being.

So.  Are you stressed?  Psychologists tell us that action is a great stress reliever.  Take the recommended actions and your stress will turn to peace, a rare quality in today’s world.