BOSTON (CBS) – Life is full of obstacles! These are the barriers to your financial success. A stock market downturn, a job loss, an illness, a disability, a divorce, a death, a boomerang kid, elderly parents needing financial help.

READ MORE: Maura Healey Announces She’s Running For Massachusetts Governor

These are certainly some of the obstacles you may face as you live life. And you’ll never be able to plan for all of them, but having a financial plan, proper insurance, and some savings for an emergency will help you manage anything that comes your way.

There are two other obstacles we will encounter, taxes and inflation. So Step 4 of your financial plan is to prepare for these now and in retirement.

Taxes are fluid. Always changing depending on what the White House and Congress want to do with the economy. Most tax changes come in December.

Tax planning tips:

  • Keep good records
  • Understand the tax laws and be aware of changes, the IRS is not going to send you an e-mail or a text alert when things change
  • Contribute money pre-tax to your retirement plans and have it grow tax-deferred
  • Use a 529 college savings plan where the money grows tax deferred and withdrawals are tax free

 

No matter how hard the Federal Reserve Bank tries, inflation will always be around. Last year it clocked in at 1.5%. And so far this year it’s a bit higher. Not too bad.

READ MORE: Snow Moves In For Thursday Morning Commute, Bitter Cold Arrives Friday

Historically, inflation has averaged close to 3% over the last 75 years. College costs though are increasing at an average of 6%, medical expenses at 10%.

You can ask for a raise to cover the increased cost of living but that may not work out very well. Social Security does have an inflation component as does some pensions.

You want your investments to earn more than the current rate of inflation and more than your tax bracket to keep pace. And you will probably need some stocks in your portfolio for over the long term stocks historically have beaten bonds and savings account to keep up with inflation.

 

Money Conference Alert!!

On October 11th I will be the key note speaker at The Money Conference which is a FREE one-day event presented by The Office of Massachusetts State Treasury. It will be held at UMASS Boston and the first 500 registrants will get a free copy of my newest book, Money, Your Personal Finance Guide.

MORE NEWS: It Happens Here: There's A Lot To Learn At Animal Adventures In Bolton

There will be afternoon classes on everything from budgeting to buying a house. The Financial Planning Association of Boston will have volunteer financial planners there to help answer questions. You can set up a meeting with a Money Mentor when you register. If you have questions about the conference, contact Sheila O’Loughlin of the State Treasury at (617) 367-6900 ext 615.