Why You Should Join a Board

why you should join a board by don chamberlinWhile it seems like a big commitment, volunteering to serve on a nonprofit board is a lot more accessible than you might think.  There’s often an image of nonprofit boards being restricted to extremely wealthy socialites with no shortage of money or time on their hands.  Yet the reality is a lot different; nonprofit boards aren’t anything like corporate boards, and each one is different from the other.  Organizations could hope for board members with capacity, but more than anything else you want to find somebody whose passionate and influential.  Here are some of the reasons you should join a nonprofit, based off an article I found online:

Learning patience: A lot of words can be spoken over a conference table; people can argue, say stupid things and make brilliant observations.  Being able to wade through all of that will teach you patience.

Asking for money: When you were trick or treating as a child, you may have brought around a UNICEF box, asking for pennies for a good cause.  If you can ask for money as an eight-year-old dressed like Mickey Mouse, then you can absolutely ask for money as an adult board member.

Enriching your resume: Being a board member looks good on any resume.

Meeting interesting people: People who join boards are almost always interesting, choosing a more hands-on approach to charity than that person who just attends a charity auction once a year.  Being around such people will benefit you on numerous levels.

Playing nicely: Being on a board member with a bunch of people who are otherwise unconnected to you is all about diplomacy.  Learning how to turn your board into a team will benefit everybody leaps and bounds.

Understanding assets better: You’ll learn how to better read and understand financial statements, then ask a related question that will actually make sense.

Running effective meetings: If you find yourself as a committee chair who heads a group of people that don’t work for you, you’ll need to learn a very different set of skills than any regular staff meeting, which can improve overall leadership.

Stimulating your mind: Board service at its best will let you bring your full self to the table, something you can’t always do in an organization.

Appreciating the organization better: The closer you are to the work of a nonprofit, then the more passionate you’ll become about it.

Understanding Retirement Tools

Understanding Retirement tools by Don ChamberlinEven if retirement seems like a long way away, you should still be familiar with all of the tools in your retirement income toolbox.  You can use various plans to manage risks by strategically combining the retirement income tools at your disposal.  Here are some tips for better understanding the tools in your retirement income toolbox, based off an article I found online:

Total return investment portfolios: Making regular withdrawals from a well-diversified investment portfolio is a common way to obtain retirement income.  Systematic withdrawals don’t protect a retiree from longevity risk or sequence-of-returns risk, and may only protect from inflation risk when asset returns can keep up with inflation.  Such an approach lets you keep your nest egg growing to grow a large inheritance.  However, it’s particularly vulnerable to declining cognitive abilities, since it requires complex financial decision-making to properly manage.

Individual bonds: Often, you can hold fixed income assets to their maturity to support short and/or medium term spending.  Holding bonds can avoid selling them at a loss, although individual bonds don’t provide longevity protection.  While they may provide technical liquidity, selling them early to use them for other contingencies could lead to capital losses.  While managing bonds can get complicated if your mind starts going, retirees can take comfort knowing that there will be time for their stocks to recover before they must be sold, even in the face of a tumultuous market.  Using bond to provide income could also be easier for retirees to understand why the overall asset allocation is what it is.

Income annuities, traditional pensions and other annuity types: Partially annuitizing your assets can also provide an effective way to build an income floor for retirement.  Income annuities provide longevity protection by hedging the risks associated with not knowing how long you’ll live.  Consider questions such as whether or not you want to annuitize, an appropriate age to do so, how much you want to and whether you want to build a ladder of annuities over time.  Annuities help manage many risks, but they don’t provide any growth potential and life-only versions won’t support an inheritance on their own.

Social security: The ultimate form of income annuity, and generally one of the largest assets on the household balance sheet.  It provides inflation protection, longevity protection, protection from sequence of returns risk and survivor benefits.  Social security offers a better deal than any commercial providers; since income automatically continues over time, it also provides protections for cognitive decline.  The only risk it doesn’t help manage is spending shocks.

Housing wealth: This can be used in a variety of ways in retirement.  If care is taken to choose housing that will allow for aging in place, then it can provide inflation protection and some protection for the uncertain costs related to long-term care.  With long-term care needs, it could be used to live comfortably outside of an institution for a longer period, and housing wealth could be redeployed to cover the costs of institutional living when necessary.

Long-term care planning: One of the largest spending shocks facing a retired household is the need for ongoing long-term care.  A retirement income plan needs to account for this, and various tools are available to help control the impacts of long-term care costs on family wealth.

Other assets, insurance and income sources: A variety of other retirement income tools can also serve as a valuable source of retirement support.  Decisions made about Medicare or other health insurance can help to manage the risks of large healthcare spending shocks throughout retirement.  Part-time work can help support a more fulfilling lifestyle while also providing an extra source of income to help mitigate any risks related to market returns.  Social capital, or the ability to obtain help from family members or your local community is another source of support.  Access to these opportunities can help mitigate harms related to the various retirement risks.  Life insurance, business holdings and rental income from real estate are other potential assets that could serve as a source of support.