Black Enterprise Financial Fitness Contest

Winner #5, Phillip & Jamie Lomax

didn’t know exactly how much he was spending there, Mitchell says. And Jamie tends to pay for certain expenses with their credit card, like dinner and entertainment. Eliminating those two expenses will enable the Lomaxes to direct their leftover cash into their retirement plans.

  • Max out her retirement plan. Mitchell says that while Jamie and Phillip have taken their first steps toward investing by starting an investment club, buying a mutual fund and purchasing a stock through a DRIP, she should “max out” her qualified retirement plan.
    Since Phillip is in the armed forces, he doesn’t have a defined-contribution plan like a 401(k), although there is legislation in the works to change that for military personnel. Instead, he has a defined benefit plan that will pay him 50% of his base pay after 20 years of service. Jamie, however, does have a 401(k) plan, so she should contribute the maximum amount-currently $10,500 a year. The Lomaxes should also consider opening up IRAs-they recently closed one-and contribute the maximum $2,000 apiece to build up their nest egg.
  • Plan their finances together. Mitchell doesn’t recommend that Phillip be solely responsible for his and Jamie’s finances, even though she seems to agree with the arrangement. “When it comes to financial decisions, both players should have access to the deck of cards,” he says. That means Jamie should be an active partner in the family’s finances.

Phillip & Jamie Lomax

Checking $1,000
Savings 2,000
Stocks 820
Mutual funds 550
401(k) 3,000

TOTAL $7,370

Mortgage $79,000 Car loans 13,500
Credit cards 2,300

TOTAL $94,800
NET WORTH -$87,430

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