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One Simple Thing

Dennis Friedman

I THOUGHT SAYING goodbye to my coworkers, and walking out my office door for the last time, would be the most memorable moment from the beginning of my retirement. But, no, that moment didn’t come until the next day.

I woke up, got out of bed and walked into the living room. Staring out the front window, I felt this sense of calm and peacefulness that I can’t remember ever feeling before. I felt so relaxed that I could swear I was weightless. I didn’t have a worry in the world. It seemed like all my troubles disappeared when I left my job. I thought I’d reached nirvana. I asked myself, “Is this what retirement feels like?”

Of course, retirement isn’t without its problems. Retirees have health issues, relationship problems and money woes, just like everyone else. If you’re like me, you’re always looking for ways to make your life less stressful. On that score, here’s one simple thing you can do with your money that can be a big help: Organize and consolidate.

One of my first jobs was as a production planner at an aerospace company. As a neophyte, I was indecisive and unable to keep up with the workflow. One of my seasoned coworkers pulled me aside and gave me some helpful advice I’ll never forget. “Clean up your desk,” he said.

At first, I couldn’t understand how this simple act of housecleaning was going to solve my problems at work. But it sure did. Organizing my desk gave me a clearer understanding of what my priorities were, allowing me to make timely and accurate decisions on what needed to be done. More important, it made me feel I was in control and gave me the morale boost I desperately needed at that time.

I’ve taken that same advice and better organized my personal finances, consolidating everything into fewer financial accounts. I used to have my money with seven financial institutions. Now, I have only two. My finances are less time-consuming and stressful because, with fewer accounts, I have fewer decisions to make. It also gives me an easier and clearer understanding of how well my overall investment portfolio is performing.

My wife and I have consolidated all our investments at Vanguard Group, while our saving and checking accounts are at a local credit union. Our financial life is not only simpler for us, but it’ll also be simpler for our heirs. After our deaths, our loved ones will spend less time filling out paperwork and dealing with different financial institutions, each of which will have their own requirements for closing accounts.

Of course, I might be able to find better interest rates for my cash at an online savings bank. But my credit union’s rates are competitive enough, and it means I don’t have the hassle of dealing with additional accounts. Meanwhile, if you have a mutual fund you like, you may be able to transfer it to Vanguard, or whatever primary investment company you use. You don’t have to liquidate the fund. That’s what I did with a T. Rowe Price mutual fund.

In fact, Vanguard makes the process of transferring assets easy. It’ll generate the paperwork for you and send it to your online account’s message center. All you have to do is upload a copy of the latest statement for the asset you want to transfer, attach it to the paperwork and sign the documents with your electronic signature. This process, however, doesn’t apply to a 401(k). For those, you’ll likely have to contact your previous employer to generate the required paperwork.

Why did I choose Vanguard? In recent years, there’s been some grumbling about Vanguard’s customer service. But I’ve found over the years that Vanguard is not only an excellent financial institution to invest your money with, but also it provides great customer service, especially during difficult times. When I was the trustee for my mother’s estate, a customer service representative stayed on the phone with me, answering all my questions until the required documents were completed. None of my mother’s other financial institutions was willing to do that.

Dennis Friedman retired from Boeing Satellite Systems after a 30-year career in manufacturing. Born in Ohio, Dennis is a California transplant with a bachelor’s degree in history and an MBA. A self-described “humble investor,” he likes reading historical novels and about personal finance. Check out his earlier articles and follow him on Twitter @DMFrie.

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