Financial Planning

In a financial crisis, the typical advice from experts is to stay the course, keeping investments in place for the long term and waiting out the downturn. But people close to retirement may not have that luxury. Although the stock market rebounded sharply last week after plunging earlier in the week, share prices remain well below their levels at the start of the year. With all the recent volatility, here are some tips for a contingency plan.

Most parents want to leave their kids some inheritance. But for Ian and Lisa Revell, it's a necessity. Their daughter, Monica, 19, suffered traumatic brain injuries from a car accident nine years ago and needs continual care, something the Revells have been able to do on their own -- so far. But Ian, 50, and Lisa, 42, now are looking at their own mortality and want to leave enough money to provide for Monica after they're gone.

Adults make plenty of mistakes with their money. Themint.org wants to keep teenagers from doing the same. The financial literacy website, produced by the Northwestern Mutual Foundation and the National Council on Economic Education, aims to help teens learn how to earn, save, budget and invest money. The youth-friendly site is filled with colorful graphics, polls and playful quizzes such as "When will you be a millionaire?"

A major Wall Street bank crumbles. A money fund tanks. The stock market retreats to levels not seen in years. And as investors are bombarded with scary bulletins from the financial system, financial planners are finding that their textbook advice -- "Stay the course" -- can be hard for clients to swallow. "Every time the stock market tries to rebound, another shoe drops," said Kurt Brouwer, chairman of Brouwer & Janikowski in Tiburon, Calif.

Everybody makes mistakes. But when it comes to money, even little errors can prove devastating. Bruce McClary, communications director for Clearpoint Financial Solutions, recalls a senior on a tight budget who was getting along fine until a $250 car repair sent her into a tailspin. She borrowed money at double-digit rates that she couldn't pay back, which was then compounded with late fees. Her mistake was simple: She had no emergency fund.

For two decades, Danny Lockwood believed that investing in the stock market was essential for a comfortable retirement. Like millions of Americans, the 41-year-old West Hollywood resident steadfastly poured money into mutual funds that invest in stocks. For him, a sharp decline in the value of his portfolio meant only an opportunity to add to it at lower prices. But after two bone-rattling bear markets in the last eight years, Lockwood is abandoning his blind faith in stocks.

Michael and Esther Maston had hoped the fertility drugs would work, but they weren't ready for the news that they were going to have triplets: a boy and two girls. "We can't afford to send three kids to college" at the same time, Michael, a civil engineer for Rancho Cucamonga, recalled saying in the doctor's office that day in 2001. Since then, the Mastons have been focused on saving for their children's college educations and building a retirement fund for themselves.

George and Virginia Filart have seen their share of financial ups and downs since they emigrated from the Philippines more than 30 years ago with just a few hundred dollars in their pockets. Back then, George landed a job as a design engineer and Virginia found work as a nurse. But George's career has had some rough spots -- he was laid off four times during construction downturns, and each time, the couple exhausted their savings, then rebuilt their financial safety net.

Painting a jungle mural from a kit in the bedroom of her new twin grandchildren was giving the artist in Patricia Newton a pain in the neck. Why was the lion frowning? What was with the toucan's backward ankles? And, darn, that monkey was ugly! The former Walt Disney Imagineering designer couldn't help but paint over the offending primate, put a smile on the lion and fix the bird legs.

Worried about how you're going to pay for the holidays? Here's a plan: Find painless ways to save on things you pay for all year. There are plenty of opportunities, if you know where to look. "If you treat a few big things as discretionary purchases and shop around, you can save hundreds of dollars," said Steve Krenzer, president of Experian's interactive media group, which operates LowerMyBills.com. Here are five money-saving ideas.