How Rich Do You Think You Are?

Wealth can be defined in many different ways, but classically it is measured through one’s net worth.  Your net worth is simply everything you own versus everything you owe.  The own part of the equation includes real estate, cash, stocks, bonds, 401(k)’s, IRA’s, businesses, and much more.   The owe part of the equation includes mortgage debt, student loan debt, car loans, credit cards, and more.  Once you subtract the liabilities from the assets, you can begin to determine just how rich you really are in today’s day and age. WHERE DO YOU RANK IN WEALTH (source: wsj.com) (If you have a household net worth of X … you rank in the Y percentile): $50,000 … 60th percentile $93,000 … 50th percentile $100,000 … 48th percentile $200,000 … 34th percentile $500,000 … 18th percentile $750,000 … 12th percentile $827,000 … 10th percentile $1 million … 8th percentile $1.4 million … 5th percentile $6 million … 1st percentile There is a really ...

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Is Technology Draining Your Cash Flow?

Have you ever had one of those moments over the past year where it felt like technology itself wasn’t really a good invention at all?   Perhaps your nine year old told you that they needed a new mobile phone because theirs was out of date.    You may have flipped through your premium movie channels only to joke to yourself that there’s never really a good movie on to watch when you are clicking away.   Possibly, you became so frustrated because in your drawer of bottomless cords at home you couldn’t find the plug in charger for one of your devices.    Technology is so integrated in our lives today, but is technology itself draining our cash flow? The Mobile Phone Game- Admit it.  You couldn’t tell me all of the plans your cell phone carrier offers today even if you bought a phone three months ago.  Verizon recently changed its plans again, now allowing you to pay a monthly fee for ...

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How much should I keep in a cash reserve?

Building a solid financial plan is relatable to building a strong house.    If you create a secure foundation and structure for the house, it is likely to stand up against all of the elements over the course of the years to come.   Many financial plans fail because the two key areas of the foundation which include having an appropriate cash reserve and having adequate risk management protection are not put into place before people begin investing.   There are often various numbers thrown around in the media about what is an adequate cash reserve to have in your financial plan, but here are some thoughts for consideration on how much money to have in checking, savings, and other short-term investment instruments. The first question you should be asking is whether you are employed (and where your job stability is at work) or whether you are self-employed.    My opinion is that people who own a business should have about double the normal ...

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