That doesn’t mean you need a formal financial plan. In fact, the vast majority of Americans never do any formal financial planning. And, for most, things work out just fine.

Some people do have extremely detailed plans. Many times, that’s just right for their situation. Other times, it’s complete and expensive overkill. But bear in mind that a plan can be complete overkill by any objective standard and still be perfect for the individuals involved.

Because when it comes to money and finances, there is no one-and-only right way. No “one size fits all.” Never has been, never will be.

What I want to do is give you some practical suggestions for thinking about planning so you’ll have a basis for considering what might be right for you.

Your money is like your health. No one will ever care about it as much as you do. But it’s as hard to anticipate what your life will be like 30, 40, 50 or 60 years from now as it is to know what your health will be, let alone what the world will be like then.

To a large extent, with your finances as with your health, your best bet is probably to develop good habits today and stick with them, trusting that they’ll serve you well in the years to come.

Taking a personal interest in managing your money pays huge dividends. Gaining confidence in the trustworthiness of your gut instincts (or learning if that’s not one of your strengths). Asking questions. Remembering that money is not necessarily wealth. That money may not buy happiness but it can save you from a lot of misery. And that it’s never worth going into debt to keep up with the Joneses because the Joneses aren’t paying attention and they sure won’t be paying your bills.

Most people handle that kind of “planning” on their own. And it’s basically free, taking only a reasonable amount of determination, persistence and self-interest.

When you face a big choice, a crossroads or a curveball — and there are plenty of all three in life — that’s when it may be well worth your while to consult with a financial advisor.

Ideally, part of your due diligence along the way will be getting to know a couple of advisors, professionals whose judgment you will be comfortable trusting when you have to make significant decisions (possibly in a short amount of time).

Good advisors are easy to recognize because they tend to have many things in common, including: 1) Taking the time to get to understand you and your situation; 2) Being willing to consult with you without selling you anything except their advice and ideas; and 3) Absolutely never objecting if you want to get a second opinion and, in fact, even encouraging you to get one.

Overall, as much as possible, plan to be open to being adaptable. Look for new ideas. Be willing to jettison things that are holding you back. Even the best plans often have to change dramatically. And that’s okay.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

“It’s always best to get the lowest rate.” Not true! Unit pricing signs at supermarkets are there to give you a way to compare apples to apples. The “unit pricing sign” for a mortgage is the annual percentage rate (APR). APRs have the finance fees and charges folded in, which makes them a more accurate indication of what you will be paying for your loan. So be sure to compare APRs to APRs, not rates to rates.

Also, if you see an APR that’s noticeably higher than the rate, it probably means there are a lot of fees folded in! That’s a sign that you should ask probing questions about what those fees are and be prepared to apply for your loan elsewhere.

“My lender doesn’t want me to pay off my mortgage early.” Not true! Reputable lenders have no problem with you paying off your loan early. Those are funds they can easily lend to another borrower. If you have the money and paying off your loan early fits in with your financial plans, do it!

“I have to keep my mortgage because of the mortgage deduction.” Probably not true! If you have the opportunity to pay off your mortgage but are concerned about losing the mortgage deduction, talk to a CPA who can run the numbers. In many/most cases, paying off the loan early, saving the money you would have paid in interest and “losing” the deduction is absolutely the right way to go.

“I’ll have this mortgage for the next 30 years.” Probably not true! The average length of a mortgage today is about seven years. Some go longer, some much less. But very few people who take a 30-year mortgage have that same loan 30 years later. People refinance. They move. They think they won’t, but they do.

Keep that reality in mind when you’re thinking about how many years it will take for you to re-coup fees and closing costs. A number that might be reasonable if you’re sure you’ll have the loan for, say, 15 years, might look not-so-good if you only have it for seven years.

“If you can save even half a percent, it’s worth it to refinance.” Probably not true! If your current rate and the refinance rate are that close, refinancing most likely won’t save you enough to be worth it after fees, expenses and the time involved are added in. It pays to check, but that’s what many people have discovered.

“It’s always good to have a mortgage payment.” Not true! Having paid-up assets and fewer monthly checks to write — that’s what gives most people options and financial security. No doubt about it that should be your goal. Actively look for ways to use your income to build your savings, not for paying back debt.

Of course, for some people, having a mortgage or even a reverse mortgage can be a wise financial decision. Because then it is part of a plan. And that’s the biggest part of successful money management — having a plan. We’ll be covering how to plan in depth in the next “Smart About Money.”

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

While it’s not presented as an “improve your finances” book, Do One Thing Different: And Other Uncommonly Sensible Solutions to Life’s Persistent Problems by Bill O’Hanlon provides a wise and useful method to actually start making some positive changes.

And you don’t even have to buy or read the book to get O’Hanlon’s main premise. It’s right there in the title. “Do one thing different.”

Bankers see people with every kind of money problem. And if there’s a common denominator that keeps most of them uncomfortable financially, it’s that they have a good idea or actually know the “one thing” they should be doing differently, but they refuse to do it.

Usually, they refuse to even consider it.

And that’s a shame. Because doing that one thing differently often makes the difference between a continuing struggle and a real light at the end of the tunnel.

One example: A friend called to ask my advice about her father’s situation. He sold the family home a few years ago and moved into a condo. While he is comfortable financially, he worries endlessly about the condo fee and assessments for various upgrades and repairs.

His daughter has suggested he sell the condo and move to a rented apartment in the same neighborhood. It would be a great idea — no more condo fee, no assessments, no real estate taxes, no worries.

They spoke to their accountant who strongly seconded the idea. I thirded it — it would be a smart move for him.

So “one thing” he could do is right in front of him. But her father has become more comfortable worrying (and complaining!) than seeing those worries as a blessing in disguise.

Dealing with change and even disappointment is never easy. It can take some time to work things out.

And, obviously, these ideas do not apply to people who encounter major, unexpected, plan-upending tragedies.

But for the much more common kind of financial struggle, very often good things do come from worries and from tough times for people who are willing to look at it as an opportunity for a “course correction.”

Seeking good advice and actually taking it may be the one thing you choose to “do different” in the New Year.

May it make all the difference in the world to you!

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

But times change. Financial tools change. And the way people can make use of those tools changes too.

Some background: Up until about 1985, a homeowner might have gotten a first mortgage and, if they needed more money, they might get what was then called a “second mortgage.” Taking out a second mortgage was pretty much frowned upon by borrowers and bankers alike. The borrower had to be pretty desperate.

Then some wise person renamed those second mortgages, calling them what they really are. Homeowners wanted to borrow against their own home equity. The “second mortgage” became the “home equity loan,” and one of the most popular and useful products in banking history was born.

What does that have to do with people over 80 taking out 30-year mortgages?

People are living longer — much, much longer. And while many have more assets, more income and more money than they expected, sometimes it’s not easy to turn those assets into enough ready cash to live on comfortably. Many seniors are asset rich and cash poor.

The gentleman I spoke with was very frank. He told me that he assumed he would be dead by 81. As it so happens, he’s going strong, and with a little luck he’ll live to be 100. He has cash flow, but not enough to last the next 19 years, unless he sells his paid-for house, which he is not ready to do.

Reverse mortgages are endlessly touted on TV as a way for seniors to get the money they need from the equity in their homes — and that may be the right solution for some situations.

What we’re seeing, though, is that for many seniors, a classic “plain vanilla” 30-year mortgage or home equity line/loan works better for them financially. Both conventional mortgages and home equity lines/loans are more straightforward than reverse mortgages — they’re less complicated with lower fees.

Not so long ago, it would have been unthinkable for a 60 or 70 year old to take out a 30-year mortgage. How would they ever have time to pay it off? Now they take mortgages out all the time, and we understand that the eventual sale of the home is what pays off these people’s loans.

It’s the same for people 80+ who have some cash flow plus other illiquid assets they can’t easily tap or draw down without various consequences, including tax consequences.

It sounds ironic, but it’s true: Taking on the “burden” of a 30-year mortgage can actually lift many other burdens off these seniors’ minds.

As I said, it’s not right for everyone. But if you wonder if it might be right for you or someone in your family, talk to your banker and other financial advisors. This is a brand-new way to use old, trusted tools, and it’s worth finding out if it would work for your situation.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

Here’s what happened: He had received an email from a “mystery shopper company” — and there’s a reason why that’s in quotes — asking if he’d like to participate in their regional program to test service at local Western Union offices.

The deal? They’d overnight him three checks for $1,500 each. He would deposit these checks in his checking account, keeping $500 for his “work” and then send $4,000 back via four Western Union offices, $1,000 at each.

This “assignment” came at just the right time. His car needed some repairs and he figured, “$500 will cover that, and then some.”

He followed the instructions of the “mystery shopper company” to the letter, and that’s when the bad things started happening. First, he got a call from his bank, saying his account was overdrawn by several thousand dollars and asking when he was going to come in and clear that up. Then his online payments started bouncing left and right. And then he started getting overdraft charge after overdraft charge — hundreds of dollars worth.

Needless to say, he went right over to the bank, and they told him that he had been scammed. The $4,500 in checks he’d been sent were counterfeit. “Okay, that’s pretty bad,” he thought. “But now the bank insurance will make me right on this.”

The man was astonished, and then truly enraged, to learn that bank insurance covers depositors against a bank failing. There is no bank insurance covering customers against being scammed.

“Well, what if I just refuse to make good on the $4,500?” he asked the banker. She told him he had (even unknowingly) been passing bad checks. For all they knew, he could be a money launderer. They didn’t want to bring in the police, but they would if they had to.

People love having instant access to deposited funds, and it is a good development. Unfortunately, scammers worldwide love it too, which is why banks urge customers to be extremely careful about who they accept checks from. Banks are legally required to protect assets. This man’s bank had no choice but to expect him to make good on the counterfeit checks he had deposited.

A red flag for scams

Please be aware of this and please share it with anyone you think it might save from a scam: If a stranger asks you to deposit checks that they send you into your account and then wire the money somewhere for them, it’s a scam. Period.

Bankers and police hear endless variations of this man’s story all the time, usually and sadly after someone has lost a substantial sum.

If you’re not sure or find yourself hoping this deal could be real, please talk to a manager at your bank before you act. Or call your local police and ask to speak to an investigator about a possible fraud. (The Canton Police have an excellent fraud team — call 781-828-1212.)

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

There are events no one can anticipate or fully prepare for — a life-changing tragedy, a major economic catastrophe like the Great Depression, even lesser economic disruptions, like the current Federal Reserve policy of holding down interest rates (which is hurting many seniors) or a housing bubble bursting.

The best people can do after those kinds of events is react, adapt, and pick up the pieces.

Then there are money mistakes.

Money mistakes usually center on decisions people regret — things they later think they should have seen coming or done differently.

Money mistakes come in every flavor, because money is complicated. There are lots of ways to go wrong, and everyone does go wrong every now and again.

Basically, it seems to me that people’s big money mistakes all boil down to one thing: Making an important financial decision without taking all of the options and repercussions into consideration.

Two quick examples: A businessman recently had his book published by a big-name publisher — a dream come true for him. But now he’s complaining that his “pittance” in royalties barely pays for a coffee a day.

A writer in the same industry who has self-published several books blogged that he doesn’t get the prestigious publisher glow, but his books are a profitable “hobby” that buy him a couple of nice vacations every year.

The mistake the businessman made? Not being completely clear with what he wanted from his book. If it was glitz, he got it. If it was money, there were other routes he could have considered and taken.

Speaking of coffee, many people say they can’t afford to contribute to their 401k plan or that they don’t understand what a 401k can do for them long-term.

Plenty of those same people can (and do) spend on treats like fancy coffees and eating out, which is fine, except that with pensions becoming a thing of the past and Social Security a question mark for younger workers, the handwriting is absolutely on the wall. People are going to have to fund their own retirement.

Missing out on long-term, compound-interest savings — that’s a money mistake! And not adding enough to a 401k plan to earn an employer’s matching funds — that’s walking away from free money! A definite money mistake!

Maybe the right thing to do in these situations seems obvious to you, but everyone has blind spots, especially around money. Today people have more opportunities than ever before, which is great. But they often have to make complicated financial decisions on their own with many options to choose from. How to avoid mistakes?

You could use the old debate team trick: be able to make the case for and against your plan. Or write down three pros and three cons. Talk with friends, co-workers and professionals, and learn from their experience if you can. That’s a real (and often free) shortcut to making money decisions you will be delighted with.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

It’s a great question.

Community bankers helping customers (of all ages!) work their way out of a bit of a financial jam often hear people say, “I wish I had learned that. No one ever taught me.” It’s a shame.

So what can a parent teach a teenager that gives them age-appropriate, practical experience managing money? Here are three things that are free, easy to do, and will benefit your kids for their entire lives:

1. Open a dedicated free checking account that you and your child manage together. (Depending on their maturity, you may want to have the account either in your name alone or with them on the account as well. An adult must be on the account of a person under 18.)

Handling a checking account is a key life skill. A simple “training wheels” account is a low-risk, real-life way for you to help your kids get familiar with checks, ATM/debit cards, online banking, and account statements.

Fund the account with a modest sum — maybe set aside savings from birthday/holiday cash gifts. The goal is to give them an early chance to be part of successfully handling their “own” money.

2. Forced savings are the miracle of modern finance — a simple, painless way to save. And 13 is about the perfect time to get kids into the excellent “pay yourself first” habit.

Have them agree that a certain percentage of any money received or earned goes directly into a savings account — perhaps one connected to that checking account they’re sharing with you.

If your kids are like most people, they’ll quickly learn that the money adds up very fast and that they don’t miss it at all on a day-to-day basis.

3. There’s no better way to learn about what things cost than paying for them! Help your teenager learn about trade-offs, value, and making good choices by having them pay some of their living expenses — cell phone bills, school clothes, gas, team fees and gifts, for example. Let them see for themselves how quickly expenses can multiply.

Bonus suggestion: Too many college kids get into trouble with credit cards. Talk to your kids about not getting a credit card until they are working at their first serious job. They will be very grateful in their 20s not to be saddled with a mountain of super-high interest rate credit card debt and a bad credit rating.

Please note: If your family/financial situation is unusually complex, please consult with your advisor(s) before implementing any of these ideas.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

Being debt-free.

Does that mean being some sort of Grinch and not buying any gifts? Does that mean never using credit cards again and always paying cash? Does that mean never having fun spending money on stuff?

Of course not, to all three! Buying and giving are part of most people’s idea of happy holidays. Credit cards are, in most cases, perfectly useful financial tools that provide some benefits that cash cannot. And people who are debt-free still buy lots of stuff.

What does being debt-free mean then, and why bother making the effort?

To some people, it means having their home, auto and college loans paid off and all credit card balances paid in full every month. For others, it means no debt except a mortgage.

People who are debt-free know how good it feels not to owe money to anyone. Today’s income isn’t earmarked toward some ancient bill. They worry less. They can actively build their savings. And they save thousands on all kinds of interest. It takes hard work and dedication to get (and stay) there, but it’s an excellent place to be.

How can you get there? Here are three ideas to get you started:

1. Believe it’s possible to be debt-free. Many people, for example, believe they’re “always going to have a car loan.” They buy cars accordingly. People who are debt-free look for a well-priced, super-reliable car they can get 10-plus years from. They pay it off as quickly as possible — often in three years or less — and are auto-loan free for years at a time. These folks believe it’s possible and take every opportunity to make it happen.

2. Know yourself. Becoming debt-free means paying off current balances. There are all kinds of strategies. Some experts advise starting with the smallest debts, to get a jumpstart on knocking them out. Others suggest getting rid of the highest-rate debt first. Homeowners with equity may have the option of rolling higher-rate debt into a single loan that they work to pay down aggressively. (That only works, by the way, if you know you can trust yourself not to run up other balances again.) The bottom line: Choose your favorite method, and get started.

3. Make becoming debt-free your hobby. It’s actually one of the world’s most lucrative hobbies! Remember, though, that most people don’t get into debt overnight, and they won’t get out overnight.

Making it your hobby makes the journey more fun — talking to others about their money-saving ideas and tactics; sharing your victories with your family; and having your kids learn firsthand that it’s possible to live a wonderful life with minimal debt or no debt at all. That truly is a priceless lesson and an exceptional gift.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

Does this mean that the bank is in trouble? Absolutely not!

What does it all mean for the mega-bank then? Possibly three things:

* Since the government has limited how much banks can charge for overdrafts and debit card fees, the big bank is cutting costs — in this case, including hiking fees and shrinking their payroll.

* They made an acquisition that didn’t work out as planned; now they have to resolve that situation and move forward smaller and leaner.

* Any publicly held company, including the mega-bank in the news, has an absolute fiduciary duty to shareholders and to Wall Street. They come first. The pressure to increase earnings is relentless.

And there is a real question whether any major stock bank can ever earn enough on regular community banking (compared, for example, to investment banking) to satisfy investors. That’s part of why they’re making acquisitions and raising fees, but it’s not clear yet how successful those strategies will be.

It’s funny now to recall that a few years ago some in the industry were predicting that regional banks, local independent banks and credit unions would disappear and soon we would see only a handful of mega-banks serving the whole country.

Actually, what we are seeing today is that community financial institutions are as strong and vibrant as ever, because it turns out that they serve all the needs of many individuals and businesses — often with much lower fees! And most are not publicly held, so their primary focus is on customers, not Wall Street.

Also, many of the regional/local banks and credit unions did not depend on overdraft or debit card swipe fees; the government’s new rules have not caused them the same earnings problems as the mega banks.

Competition is good, because it gives customers options and different ways to get the bank that’s right for them.

Most customers want modern banking that lets them manage their finances conveniently — a nearby branch; the chance to talk to a person quickly and easily if they have a problem or question. Short lines in the lobby and the ability to call their branch directly (as opposed to a call center) also matter to many bank customers.

The good news is that here in New England people have many, many ways to get good banking. From huge banks to smaller ones, we are lucky to be one of the most bank-rich areas in the country.

Look for a financial institution where you’re comfortable — where they have the services you need, want and actually use. Because banks are definitely like any service you use and need: Things are easier when you have one you know you can depend on.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.

She could easily afford the mortgage on the properties she liked. All she had to do was sell her condo before the real estate market improved and priced her out of her new “dream home.”

Unfortunately, she owed $275,000 on the condo, but according to several realtors, she could only hope to get $235,000 in today’s market. She didn’t have $40,000 in cash to make up the difference. She was stuck.

The woman had spoken to many people about this predicament, including a friend who advised her to just “walk away” from the condo mortgage and let the lender — a regional bank — deal with it. According to her friend, it was the “smart move,” “easy to do,” and people did it “all the time.”

That’s not exactly right.

A mortgage is a serious financial commitment that’s hard to walk away from … for good reasons.

Media reports make it seem like everyone, from major corporations to the folks next door, are defaulting on obligations with no repercussions — which isn’t the case. Corporations’ restructuring plans have to be approved by the courts, and it’s always a black mark on their reputation.

Walking away from a mortgage has lots of repercussions, including possible tax liabilities and significant long-term credit score damage.

Also, Massachusetts allows a lender to seek to recover the amount owed on a mortgage, known as the deficiency balance. So a borrower who walks away from a mortgage may still owe it!

Some people were tricked into predatory loans. This woman wasn’t and she has no financial hardship — nothing to justify a forbearance from her lender. A default in her situation will be a serious red flag to a future lender.

Under the circumstances, I advised her to consider staying in her affordable and comfortable condo — an idea which, she admitted, had many advantages (including allowing her to beef up her savings, which were fairly low). Or she could rent the condo and use that income to cover her expenses until she could either sell at a better price or save enough to cover the difference between what she could sell for and the balance on the mortgage.

The bottom line: This woman has two viable options for having what seems to be a “bad” situation work out very well for her … without the long-term and not-insignificant burden of a default on her credit record. I wouldn’t be surprised to hear at some point that this particular cloud had a real silver lining. They often do.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to submissions@thecantoncitizen.com.