Your financial plate

Marianne Hayes
October 23, 2017
15 min read
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When it comes to our physical well-being, professional guidelines carry a lot of weight.

Public health initiatives like the ever-popular Healthy Eating Plate, courtesy of the Harvard T.H. Chan School of Public Health, promote the lasting benefits of sticking to a balanced diet.

But when it comes to our financial health, the cultural conversation isn't nearly as vibrant. The taboos around openly talking about money are unfortunately alive and well, but we think it's about time we got real about financial self-care.

Looking to get your financial house in order? Dave Fanger, Chartered Financial Analyst and Swell's CEO and founder, opens up about creating a healthy, balanced "financial plate." Here are the four best ways to divvy up your money.


Having a liquid reserve of cash on hand is critical to see yourself through life's many pop-up expenses, whether it's a stint of unemployment or an unexpected car repair. Turning to credit cards is a slippery slope that can put you smack in the middle of a debt cycle, which is why having a solid emergency fund is key. Still, two-thirds of Americans would struggle to pay for a surprise $1,000 expense, according to a 2016 poll put out by The Associated Press-NORC Center for Public Affairs Research.

The idea is to protect yourself by building up six- to nine- months' worth of expenses. From there, it's about keeping it someplace safe (i.e. not your checking account).

"I like short-duration funds that give you a little bump and inflation protection as a safe harbor investment," says Fanger.

A healthy mix of investments

We all know that investing is a key component to growing your money over the long haul. That said, be sure to diversify your efforts.

If all your eggs are in one basket, what will you do if the market dips?

The best protection is mixing up your asset allocation so that your portfolio reflects a healthy blend of stocks, bonds, and cash.

The good news is that you don't have to be a financial advisor to pull this off. Swell makes it easy, leveraging impact investing in a way that mitigates risk. Not sure where to start?

"I personally prefer equities, like dividend-paying stocks and stock mutual funds,  for those who are under age 50 or at least 10 years away from retirement," says Fanger. "Younger investors are better positioned for slow, steady growth since they're a ways away from cashing out their nest eggs."

Retirement savings

Your investment strategy goes hand in hand with your retirement savings. Even if you're a long way out from your golden years, it's never too early to start planning for the long term. (Trust us, your future self will thank you.) If you have an employer-sponsored retirement fund, like a 401k, it pays to kick into it if you plan on staying with the company long enough to vest in it. If your employer offers a match, all the better as this is essentially free cash.

But while the 401k has long been the retirement fund darling, it's far from your only option. Contributing to a Roth IRA is a tax-efficient way to really maximize your efforts. In this scenario, you'll pay taxes prior to investing, assuming you meet the IRS's income requirements, but your money will grow tax-free. You also won't get hit with taxes when it comes time to withdraw from it.

Another effective, portable way to save for retirement is to leverage a health savings account (HSA). Here, contributions are pre-tax. When you use the account for health care, including health care expenses in retirement, it's tax-free. The kicker? When you turn 65, you can use it for anything with no penalty.

Saving for what's important to YOU

Everyone's savings goals are different. Just as some impact investors prefer to invest in, say, disease eradication over renewable energy, it's all a reflection of what matters to you on an individual level. That said, your financial plate should be tailored to your values.

What are your long-term goals? Whether it's purchasing your dream home, easily putting your kids through college, or finally taking that European vacation, your investing strategy should support them. In other words, it isn't all about retirement.

How you approach it depends a lot on your risk tolerance. Are you comfortable investing more modestly, getting a smaller return, and having to wait longer to cross your goal off your bucket list? The other end of the spectrum is investing more heartily and getting a potentially bigger return; the caveat, of course, is that doing so makes you more vulnerable to losses.

Ability and willingness

Dave Fanger has this to say, “Investing comes down to the willingness and ability to take risk. Willingness is more risk-averse than ability and people should be more in the stock market than they are – there is an education needed to show people that their ability is greater than their willingness so they can be more in equity. When thinking about your risk tolerance (ability) it's important to have access in the short-term if there is an emergency. If you have this type of ability to bear risk (like being out of work for 3 months) then that is one criterion.

To me, the other is the ability to take this equity risk on for a long duration (10 years) as the idea is that you will not need access to these funds for a long duration (you don't want to pull out that investment in a recession). This is why those younger (more than 10 years from retirement or need for those funds) generally have the ability to bear equity risk.”

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