Imagine two people are getting onto Interstate 459 at the same time. One of them is driving a first generation 1991 Ford Explorer that is known to have rollover issues at higher speeds. The other driver has just driven off the lot with a brand new 2016 Corvette Z06 which is a world-class supercar. Do you expect the speed limit on Interstate 459 to be different for the two different cars?
Dave Ramsey is famous for saying, “If you don’t control your money, the lack of money will control you.” The most basic way to begin taking control of your money is to devise a budget. Many people who set out to live by a budget give up fairly quickly the first time they get frustrated by the process or by something they didn’t think to plan for.
Once upon a time we took it for granted that a money market account would earn an above average interest rate without risking losing money. In the midst of the 2008 financial crisis, the Reserve Primary Fund, our country’s oldest money market fund was forced to lower the net asset value (NAV) of its money market fund below $1 and all of its shareholders saw a loss.
Since I spend most of my day helping people prepare for success in their finances, you would probably expect me to say that financial resources are most critical to a successful retirement. It’s true that finances are inarguably important but financial accomplishments alone don’t ensure a successful retirement.
Recently, a client who was purchasing a new home told us that a friend had advised him to get a home equity line of credit (HELOC) when he bought the house, even if he didn’t need it. He wasn’t sure he fully understood the reasons his friend gave for doing this, and since it’s a question we’ve heard before, we decided to address it on the blog.