Preparing for the Sequester
Steve Sexton is the President of Sexton Advisory Group and has been featured in many radio and television segments providing exceptional financial advice. He is also featured in CW channel 6 San Diego Living with Kirsten Moesteller for his Money Minute segment. Steve has been providing professional advice to San Diego Living viewers for several years. On this episode, he presents his view on the sequester and how it will affect the individual.
So what does this sequester mean for you, your investments, and your wallet? With this $85 billion federal budget cut, if you have a federal job, furlough notices have already been sent out. That means you will need to take 22-26 unpaid days off a year. In other words, if you make 60,000 a year, you will lose about 5,000. Every individual will see these cuts differently, but for some this may just mean switching from eating out at a nice restaurant to eating at Chipotle. Those in the defense industry, the Marines, Navy, etc., will not need to worry about pay cuts, but government contractors are the ones who will be hit.
What if you don’t work in a federal job? What do you need to do then? There are three general rules that will help you be as prepared as you possibly can be.
- Take a look at your budget and understand where everything comes from or goes to. See if there are unnecessary expenses that you can cut out
- If you’re looking at retirement in the next 3-5 years, you need to have a plan for what you may need. If you won’t have that income in a year or two, look at current investments that you will be able to utilize. More importantly, talk to your tax advisor on how to reduce taxes now and later during your retirement.
- Look at your investment expenses. Get to know all your fees, inside and out.
When will the effects of sequestration be noticeable? Well it takes effect over the next 6 months but we will begin to notice the effects next month. California may be hit a bit harder because we have a lot of defense in government. Out of the total 700,000 job loses about 200,000 are expected in California. So start scaling back now and keep track of your budget to be as prepared for the upcoming year.
Steve Sexton also has a new book on the bestseller list being released on March 14 th. More. Better: The World’s Leading Experts Reveal How to Get More Out of Business and Life with Better Results is a book geared towards helping people achieve more success, better. Steve Sexton’s financial advice will leave you feeling educated and secure about your financials. If you have any questions feel free to contact Steve Sexton at the Sexton Advising group!