Does Your Financial Advisor Sit on Your Side of the Table?

There are lots of people and companies offering financial advice. These are financial advisors, stock brokers, news shows, online services, bloggers, investment firms, and many others. Many times the advice from these various sources is conflicting or may be biased, so who do you trust? And is there a way to know how you’re doing financially without calculating ratios, rates, and returns?

In this edition of our newsletter, we’ll tell you about a single number you can use to measure your financial success, we’ll explain how Illumination Wealth incorporates S.M.A.R.T. Leadership into our planning process, and Matt offers some advice on finding a real financial planner on the American Dream TV show.

In this edition:

• Net Worth: One Number to Monitor your Finances
• Matt Rinkey Appearances
• Illumination’s Core Values

Net Worth: One Number to Monitor your Finances

Are you overwhelmed by all the different numbers you have to think about when it comes to your personal finances?  How much do you need to save?  How much should you contribute to your 401k?  Is your credit score good enough?  Are you on budget?  What are your investment returns?  There are many numbers you can be thinking about, but if personal finance seems overwhelming to you, then start with the one number that matters most — your net worth.

Learn more about how to calculate and track your net worth for personal finance success.

Matt Rinkey Appearances

The American Dream TV Show

Matt Rinkey talks to Craig Sewing on The American Dream TV show about getting good financial advice. Does your financial advisor sit on the same side of the table as you? Do you know how your advisor is investing your money? Does your portfolio agree with your risk personality? Watch the show to learn about getting the best financial advice.

Illumination’s Core Values

At Illumination Wealth, we work under a set of core values that drive every decision we make about how we serve our clients. We believe it is important that we share these core values with you, and you will be learning about a core value of ours each month.

S.M.A.R.T. Leadership

We believe that financial smarts and financial intelligence are vital to living a wonderful financial life. As financial life planners we are committed to not only partner with our clients on their journey, but also to lead them through ongoing education and clarity through planning and goal setting. S.M.A.R.T. is an acronym for a common practice of goal setting in business environments. S.M.A.R.T. goals embody five distinct traits – Specific, Measurable, Achievable, Realistic, and Time-Bound. You are more likely to attain your goals if they have these traits. We help our clients develop S.M.A.R.T. goals in the financial planning process because financial plans coupled with S.M.A.R.T. goals provide the necessary context to make each and every decision with purpose.  Let’s look at an example.

Three years ago we had new clients who accumulated over $90,000 in debt over the prior decade. They had successful careers with high incomes but through the mismanagement of their finances ended up owing the I.R.S. in excess of $24,000 of back taxes and had $66,000 in credit cards bills. When they came to us they knew that something had to change if they wanted to have a lifetime full of world travel, fine wine and the ability to put their kids through any college they wanted. In our first meeting, they said they wanted to pay off all of their debt. We understood this to be a worthy goal, but not a S.M.A.R.T. goal. In our work, we helped them establish a S.M.A.R.T. goal around their debt as you can see below. Our clients were totally debt free before their goal date. You will see that once you set S.M.A.R.T. goals, these goals lead you to their realization.

• Specific: “My wife and I will pay off all of our debts.”
• Measurable: “My wife and I will pay all of our debts down to $0 from the current balance of $90,000 made up of IRS back taxes of $24,000 and credit cards of $66,000.”
• Attainable: This is an attainable goal. Many other people have done the same thing.
• Realistic: Is it possible to make forward progress on this goal given our current state of income? Yes! Is it something we are both on board with? Yes. If yes, then the goal is realistic.
• Time-bound: “My wife and I will pay our debts down to $0 by December 2015.” They identified a time they would like to be debt free – December 2015.

By making their goal S.M.A.R.T., we were able to calculate the most efficient way to pay off their debts and craft a healthy spending plan around it that allowed them to pay off their debt and still enjoy their life today.

It’s the possibility of having a dream come true that makes life interesting. – Paulo Coelho

As always, we hope you have found this edition to be enlightening and look forward to hearing from you soon!

All the best,

The Illumination Wealth Team

The opinions and forecasts expressed are those of Matt Rinkey, President of Illumination Wealth Management (IWM) and may not actually come to pass. Mr. Rinkey’s opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security or Illumination Wealth services. No part of this material is intended as an investment recommendation. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any of IWM’s services. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that investment objectives outlined will actually come to pass. Investors should consult an Investment Professional before investing in any investment program. Neither Mr. Rinkey or Illumination Wealth nor any of their employees shall have any liability for any loss sustained by anyone who has relied on the information contained herein. Entities including, but not limited to IWM, its officers, directors, employees, customers and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. The analysis contained is based on both technical and fundamental research. Although the information contain is derived from sources which are believed to be reliable, they cannot be guaranteed. Past performance is never a guarantee of future results.