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Subject:  My Meeting with the AmEx guy Date:  2/24/2004  10:11 PM
Author:  batdoe Number:  1965 of 5090

(Cross posted)

So, here's the update on my meeting with the AmEx guy.

First we went through his preliminary financial plan for us, but there were problems. He had college start dates for each of my children of 2007. The oldest of my kids will be 11 in 2007, so we couldn't get to all the bottom line stuff. That was annoying, but in his defense he had to rush his wife to the ER on Friday and one of his daughters has a broken leg. Things are not going well at his house and it's taking up much more of his attention than usual. I can understand this, but I would have preferred he took the time to proofread his work, even if he had to postpone our meeting.

So, we have to fit $1545 into $1000 - that is, we want to allocate $1545 to various objectives but we only have $1000 a month to save and/or invest. We have 13 savings objectives (4 kids in college, 4 bar/bat mitzvahs, one car, one vacation, retirement funding, dh's life insurance and finishing up funding our efund) - he says 13 is a record for him. It seems most of his clients are not so interested in providing for college or other things for their kids and just focus on their retirement. His preliminary advice is to put less into our retirement savings (currently we save 16k per year for retirement - max dh's 401(k) and my Roth) and put more into our other objectives. Even though our retirement looks like it will be more than fully funded at 60 (we run out of money at about age 150) I am uncomfortable with that advice. His next advice is to plan to spend less money on the bar/bat mitzvahs. That is a good plan. We'll make that be the lowest priority for the money and just spend whatever there is when we get there.

Next, life insurance. Thankfully he only brought us quotes for term life and didn't try to sell us anything we didn't want. He brought us quotes for 20 years, but I said I thought we only needed 15. In 15 years I'll only have one kid at home, college funds will be mostly funded and if I run out of the work based life insurance money I can dip into one of the retirement accounts using the substantially equal payment distributions. His suggestion was to buy the 20 year term and stop paying the premiums in 15 years. I told him that was no good because we would wind up spending more money that way. Why pay the premiums for a 20 year term ($1330 a year)for 15 years when we could pay the 15 year term premiums for 15 years ($935 a year).

We talked about rolling over one of dh's 401(k) plans into AmEx funds and he asked if we had any questions. Little did he know...

I said "I have some