One of our primary goals at The Wealth Group is to help our clients achieve financial independence at a younger age than most Americans. Financial independence doesn’t necessarily mean you retire and quit working; it just means you no longer need to keep working or saving money for the rest of your life. But for our clients in their 50s and early 60s that begin to contemplate retirement, one of their biggest concerns is healthcare costs. Before going on Medicare, buying private health insurance is certainly expensive.

I recently helped my mother purchase a 2015 SUV from a dealership. It was not a pleasant experience. Those of you that have purchased from a dealership know how long the process takes. Within 20 minutes of walking into the dealership, we were ready to pay all cash for the vehicle. We had done our research in advance, the test drive went well, and we were buying a reliable make and model.

Is your child or grandchild familiar with the concept of a “Financial Safety School”? High school students know well the concept of a “safety school”: a college that is almost certainly going to accept them. There are also “reach” colleges where acceptance is far from guaranteed, and “target” colleges where acceptance is likely but not a sure thing.

It’s silly to quote long-term spending figures as a lump sum. When you take a significant annual household expense and turn it into a 30-year cumulative lump sum dollar amount, of course it’s going to be a large number. The same could be said of food, transportation, housing, etc.

We are unique as financial planners in that we encourage our clients to rapidly pay off mortgage (in 15 years or less), even if it means a slightly reduced amount of money being added to the portfolio during those years.

Have you read our post about the Importance of Car-Buying Decisions? If you haven’t, you should. The average new car purchase price in America today is more than $36,000. That is an astonishing number, considering the financial situation of the average American today.

When you login to view your bank account balance, is it something that causes you stress or do you feel comfortable when you pull up those numbers? Knowing the proper amount of money to have in your savings account can often feel like a difficult question to answer. How do you determine what the correct amount is for your family? Before you can figure that number out, it is important to understand what an emergency fund is, and what those dollars are being saved for.

Some blog posts are more important than others. If I could shout through the screen to you, I would say: “This post is really important!” It’s not important in the sense that “Mike and Austin think this is important”; it’s important because the math shows us it’s crucial. The second-largest annual expenditure for Americans is transportation (second to housing). If it’s the second-largest annual expenditure, it’s appropriate to say this category of spending should be a big deal in the world of financial planning.

The Wall Street Journal published an article last year that outlined the number of bank overdraft transactions in 2016. The total tally? 1.12 BILLION. That is billion with a B. To be clear, that is the amount of just the transactions NOT the associated fees. Assuming the average overdraft fee is $40, that equals $44.8 billion in overdraft fees.

In the classic personal finance book Your Money or Your Life, authors Vicki Robin and Joe Dominguez outline 9 steps to “transforming your relationship with money and achieving financial independence.” The book is outstanding. One of those 9 steps is an important reality check for all of us to take: First, tally up every dollar you and your spouse have earned in your lifetimes. Second, compare the cumulative amount you have earned with your current net worth (assets minus debt).

One of the most vital services we provide to our clients is helping them understand how much they spend each month. While it sounds trivial, it is perhaps the most overlooked (and critical) piece of the financial planning puzzle. When we ask our new clients and prospective clients how much they spend each month, the spending number they give us is almost always at least $2,000 or more per month lower than their actual spending number. One of the main reasons we ask to review our clients’ tax returns is that it enables us to calculate an accurate spending number for that year.

People talk about “cash-flow” quite a bit, and based on how they use the term, I don’t think they fully understand what it means. Cash-flow is all the money you have coming in, less all the money you have going out. Income minus expenses. The number at the end of that formula (be it positive or negative) is your personal cash-flow. Oftentimes we see people who spend a lot of money and assume they have great cash-flow. In reality, those people may indeed have good income but terrible (even negative) cash-flow because of their spending habits.