Would you rather have weak hands or strong hands? Most people would answer strong hands. Why would I want hands that had issues functioning and were weak? I couldn’t open doors, or type or cook! This analogy has been used in the financial world as well. I’ve taken this metaphor in a different way and used it with financial well-being. Take a journey to see where you fall.
I think you may have already guessed that anyone with weak financial hands has planned poorly.
- Don’t know or control what you spend
- Spend beyond capacity of income and assets
- Too much debt
- Not enough cash…when you need it
- Forced to sell assets at the wrong time to meet needs
- Inadequate insurance protection
- No plan
- No communication among stakeholders
- No confidence
If you have weak hands, you probably not aware of what you spend. Basic budget management is fundamental for success, reduces stress and has a domino effect on everything else going on in your life.
If you don’t know what you spend, you may take out too much debt, resulting in more payments, resulting in not having enough cash available, resulting in going further into debt, resulting in more stress! If you are low on cash because you spend beyond your pay, it could also result in you panicking and wanting to sell certain assets in your retirement accounts to meet your current needs, which could be detrimental on your account.
Why would anyone want to be in any of the situations above? The answer is no one does, but it’s the lack of effort and action that puts people in the weak hand quick sand.
Welcome to Strong Hand Land! Which means you are 1 of 3 Americans that have a household budget. 1 Bravo! People in this category also take planning a step further by protecting themselves and their families with positive experience to sustain wealth and protect against negative experiences from divorce or sudden death.
Taking a hike deeper into strong hand land, you’ll find individuals with income and assets that are well diversified, income plans for present and future with inflation in mind, and confidence that financial goals will be met. Strong hand citizens know how to control emotions during difficult personal transitions or financial market volatility which is imperative for financial well-being. They enjoy plenty of income and assets to pay for lifestyle regardless of inflation
- Awareness of spending/lifestyle needs
- Awareness of income and assets
- Diversification of assets so one asset or class of assets won’t impact your financial success (i.e. “Don’t put all your eggs in one basket”)
- Plenty of cash and/or access to cash when needed…including unexpected cash needs
- Adequate insurance protection
- Confidence financial goals and needs will be addressed
- Control emotions during difficult personal transitions or financial market volatility
- Full disclosure and communication among stakeholders
- Be vulnerable
- …then nobody can hurt you
- Education and information for successful transition at incapacity or death
How to ensure you have strong hands?
Whether you are fully in the weak hand quick sand or just vacation in strong hand land, you may need to take some action. Like exercise or physical therapy, financial planning takes work and maintenance, it isn’t just a flip of the switch movement. The worst thing you can do is nothing. Start by following these steps:
- Gather Info. & Set Goals
- You will gather any necessary documents and we will talk about your current financial situation. Together, we will define your personal and financial goals.
- Analyze & Strategize
- We link all of your financial accounts (what you currently have) in our software for an up-to-date view and analyze to see what you need while factoring cash flow, insurance, tax strategies, risk tolerance, savings plans, insurance, etc.
- Develop Recommendations
- With a deeper understanding of your financial world, we will provide options on how to pursue your goals through detailed recommendations using comprehensive planning tools to minimize the impact of debt and taxes to enhance your lifestyle.
- Implement Plan
- It's time to activate your plan! After you agree to our recommendations, we will execute the asset allocation, tax strategies, estate planning, etc.
- Monitor & Review
- To stay on track with your goals, we will provide periodic evaluations on performance. It's also possible your financial goals may change over the years due to changes in lifestyle or circumstances (i.e. inheritance, marriage, etc.) so it is important to revisit and revise.
Your journey will continue and hopefully you'll reside in strong hand land all the way through retirement!
Your journey will continue and hopefully you’ll reside in strong hand land all the way through retirement!