Personal Economic Model

Did You Know
You finance everything you buy! When you read this you may have said to yourself, “I don’t finance anything, I pay cash”. Paying cash is financing, it is self-financing if the dollars you are spending were previously set aside for your future retirement lifestyle needs. stand.
Human Nature and your Financial Future
From time to time it is easy to yield to the temptation to buy something we want for our current lifestyle robbing from the money we have put away for our future. This purchasing strategy can be very dangerous because of what is known as “Human Nature”.
Recoup vs. Recover
If you invest in something and sell it for pennies on the dollar years later, the financial loss is just as real but it provided no benefit what so ever.
Before You Buy Consider All Costs
Suppose you want to buy a new car. I am sure you have spent some time crunching the numbers to see if you can make the payments work in your budget. Hopefully you have also considered the increased cost of the insurance on the new car as well as the fuel costs.
Pay Cash or Finance
We have all grown up in America with the dream to be debt free which is a good financial position to be in. There may be some confusion on what debt is and what it is not.
War Between Current and Future Lifestyle
There are so many “Current Lifestyle” distractions that can divert your focus from your primary mission which is to balance the two opposing positions.
Financial Warning Signs
Warning: If you have to borrow from your Future Lifestyle for a Current Lifestyle expense you could be heading for trouble. Warning: If someone or something can take it from you it is not really yours. To arrive safely at your desired future financial destination make sure you obey all the warning signs.
Three Different Purchasing Strategies
How you pay for things along the way can have a big impact on how much money you have down the road.
Zero Financial Line
Many of the financial lessons that the average American uses today are based on “what you have been told to think” not “how to think”.
Problems with Consumer Debt
You may be saying to yourself the problem with debt is no money. You would be correct but the problems are not only limited to those who do not have any money.
Problems with Paying Cash
OK, we all know debt is a problem but how can paying cash be a problem? In order to be able to pay cash one must be a saver which is a problem for many.
Collateral Capacity
I am sure you are familiar with the term net worth but do you know your collateral capacity? Some people can tell you exactly what their net worth is today while others are satisfied with just knowing about where they stand. Do you know your net worth? Knowing your Collateral Capacity could be just as valuable.
Toughest Financial Questions
If you are serious about your financial future you need to know the answers to these four questions.
Balanced Financial Approach
Like many things in life our financial position works best when it is in balance. Understanding what balance looks like can go a long way in helping you achieve that balance.
Your Income and Wealth Potential
Your income potential represents the amount of money you can expect to flow through your hands over your lifetime. To calculate you take the amount of income you make today, adjust that amount for inflation over the remainder time period of your working years.
Human Life Value
Perhaps this is a term you have never heard before. It is most often used in a conversation between lawyers trying to settle a claim in a legal battle in a wrongful death suit. Human Life Value is an attempt to determine the value of one’s life from an economic perspective.
The Tax Filter
According to the Family Research Council, since 1948 for a family of four, taxes have increased 1250%.
LIfestyle Regulator
If an increase in cash flow could help your current financial position maybe you should “reverse” your thinking about a reverse mortgage and give us a call today.
Major Capital Purchases
For most of us our monthly cash flow is somewhat regular meaning we know about if not exactly how much money we will have coming in each month. We adjust our standard of living to that amount and everything seems to run pretty smoothly until something major comes along.

Questions or Comments

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