Engine Light for Finances

A Check Engine Light for Finances? 7 Key Indicators to Analyze Your Financial Health and Retirement Plan

Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.

Maintaining our health and our car – we often take these for granted, because it’s fairly easy for us to monitor and measure.

Both the human body and modern cars have smart systems in place, like physical pain and check engine lights, that alert us to trouble that needs immediate attention.

Commonly measured vital signs offer a quick snapshot of a person’s health – think blood pressure, your pulse, your lung sounds, your temperature. And checklists and vehicle dashboard indicators keep us safe and ensure reliable performance.

But when it comes to money, it seems there are no commonly accepted checklists or best practices woven into our lifestyle that allow us to monitor or measure critical performance indicators so we can achieve and maintain wealth.

Imagine knowing what to measure, how to monitor performance and when to complete our checkups as it relates to money.

What if we measured a few vital signs for financial health? What if we could track key indicators that we could understand and accept as the “smart” way to manage our money?

A financial dashboard, like the one below, could help us monitor and measure critical elements of our personal economy that can help keep us healthy and on track as we work towards financial independence.

  • Net worth: My net worth is up from last year and continuing to increase.
  • Debt-to-income ratio: My debt-to-income ratio is below 30%.
  • Living expenses: I spend no more than 50% of my income on my living expenses.
  • Emergency savings: I have saved enough money to cover six months of expenses in case of an emergency.
  • FICO score: My FICO score is above 700.
  • Taxes: I am working toward filling a “tax-free” bucket to compliment my tax-deferred savings and investments in retirement.
  • Protection: I have insurance, legal and other benefits in place to ensure that what I want to happen, will – even if I’m not around to enjoy it.

Routine maintenance schedules like an annual physical and taking the car in for service every 12 months or 12,000 miles (whichever comes first) often result in the early detection of problems. These checkups help eliminate root causes or minimize damage before it becomes irreversible. A financial checklist can work similarly.

Since we are required to gather all our documents for the April 15th tax filing deadline, it can serve as an ideal catalyst for completing an annual financial checkup – part of your routine maintenance schedule.

And like physical health and car care, some years require more time and attention. Sending kids to college, job loss, change in employment, disability, divorce, retiring within five years – these are life events that often require more guidance or experience.

A primary care physician might send us to a specialist because the lab work or MRI comes back outside the expected or healthy range. The recommended 60,000-mile checkup might require a more thorough inspection of all the moving parts versus a routine oil change.

Some years we’re only verifying that everything is working the way it’s supposed to; other years we know there is work to be done, and we want to make informed decisions with the support of experienced professionals.

Investing 60 to 90 minutes with a fiduciary financial advisor to analyze your wealth management indicators can help give you confidence and clarity regarding your personal economy.  And checking in with a professional on an annual basis is likely to hold us accountable in a way that may be currently missing.

The wealth we work so hard to create deserves at least as much attention as the car we drive. Committing to having a check engine light for our finances allows us to decide whether to stay on cruise control or pull off and have something looked at before it becomes a bigger problem.

If you’re not sure where to start, we can help. Click here to schedule a complimentary consultation.

This is not intended to provide specific legal, tax, or other professional advice. For a comprehensive review of your personal situation, always consult with a tax or legal advisor.

facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.
Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.


Charitable Giving Strategies in a High-Income Year

Tom Fridrich, JD, CLUⓇ, ChFCⓇ, Senior Wealth Planner  The end of the year offers an ideal opportunity to look both forward and back — reflecting on recent achievements, while setting goals for the upcoming months. For many of my clients, it’s also a time to review their finances and i …

Let’s Talk About Midterm Elections and Your Investments

This week was midterm elections and we’ve had many questions about what it all could mean, which we’ll tackle in today’s blog. We consider it a great honor to vote, and while we may not know the final results of the election for days (or even months), what we do know is the election will …

3 Nontraditional Ways to Give That Still Qualify for a Tax Deduction

Kevin Oleszewski, Senior Wealth Planner ‘Tis the season to give. In fact, 37% of charitable giving occurs during the last quarter of the year — 20% of it in December alone, according to a survey conducted by the Blackbaud Institute. And while the holidays are traditionally a time to reflect …

Considering Tax Loss Harvesting? What You Need to Know First

Kevin Oleszewski, CFP® Senior Wealth Planner As the tax year draws to a close, many high-income investors will look to reposition their portfolios to intentionally generate losses as a way to offset gains — an investment strategy known as tax loss harvesting.
1 2 3 104 105 106
Engine Light for Finances

Get in Touch

In just 15 minutes we can get to know your situation, then connect you with an advisor committed to helping you pursue true wealth.

Schedule a Consultation

TweetsFollow Us