On Your Own

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Are You Getting Ahead of Yourself?

Details are important, but take care of the foundation first. 

When clients come into our office to talk about an investment strategy, the first things they ask about are often advisor fees, trade fees, types of investments, returns or other details. Now, these are all great things to know when planning your investment strategy, but over and over again, the people asking these questions have the cart way before the horse.

The truth is, most of the people asking these questions can't even tell me what they spend each month or where their paycheck goes. In other words, they're worried about trade fees when they don't even know how much to invest in the first place. They're playing a guessing game with their budgets, but are hung up on a fee difference that amounts to $30 vs $35 per year.

My point here is that you can know all the details you want, but if your budget is such a mess that you're not investing anything in the first place, well, those returns and low fees don't mean anything.

I'm not trying to be harsh here, but we see this over and over in our client meetings. We like to say that we help people organize their financial lives, and the first thing we need to do to accomplish that is determine where everything is and where it's going. Then we can make cutbacks if needed, and then determine a realistic monthly investment amount. Then - and only then - we can talk about fees, returns and other in-the-weeds investment items.

It's human nature to get excited and get ahead of yourself. We see so many people looking at houses for sale before determining what they can afford, or test driving expensive cars after seeing a zero percent interest offer. But if you haven't done your homework first, these purchases tend to end in disaster, or at least in a lot of debt and stress.

We would love to sit down with you and go over your budget, investments and any other financial questions you have. It's our job to help you organize and get on a solid path to a strong financial future - cart properly behind the horse.

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