Preparing Yourself for the End of the Year – Episode 327

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[00:01] Welcome to the Prosperity Podcast. Welcome to another episode of the Prosperity Podcast. Today, we’re going to be talking about preparing yourself for the end of the year. That’s right. This is fourth quarter talk. If you’ve ever followed a sports team or any analyst, you know it is the most important time. Would you agree, Kim? It is. And it’s a fun time. The fall weather is starting to approach. And I think people just really get geared up for some awesome work to be done between now and quite frankly, Thanksgiving because I’m not sure much happens after that. That is so true. So I think before we get into our turkey days, we should set forth some strategy. How does that sound? I love it. Yes.

[00:50] Okay. So when you are thinking of that fourth quarter and lining up things between now and Thanksgiving, because as you mentioned, we’re all going to get busy and everything else, what are some of the top three things that you like to focus on? Well, always, always, always cash, cash, cash, and then cash flow, cash flow, cash flow, because there just isn’t enough conversation around those two areas and the wonderful things that they do for our families. So I’m happy to dive in a little bit deeper on those first two. However, we have lots of podcasts on them. So maybe we don’t do a deep dive. Maybe we cover them briefly because I think it might be fun to hit point number three, but I’ll pause. What do you think?

[01:39] I think that would be great. So first, let’s talk cash and cash flow. So I would assume the first part of cash is having that emergency opportunity fund, correct? Yeah, absolutely. So it’s just so awesome. So critical to have money saved cash liquidity. And I’m talking with everybody that will listen to me about it because first of all, most financial planner types don’t talk about it. The typical financial planner is not paid to have you store emergency opportunity money. And yet it’s such an amazing thing that it does for your family. And it’s so relative, right? The Oprah Winfrey’s with their $7 million emergency funds versus my kids who are just out of college and think five grand is a ton of

[02:29] money. It’s just so relative compared to where your family is. And yet I love, and I don’t know where I got this idea long ago, but I love the addition of the word opportunity because first of all, number one, you’re going to get your emergency funds stored quickly. Number two, who wants to stay focused on emergencies as quickly as possible? You want to shift your focus to opportunities and cash and having cash and having available liquid cash creates and seeks out and attracts opportunities. Absolutely. And I think, you know, in essence, this is the prosperity podcast and you cannot experience prosperity if you’re only thinking about emergencies. Absolutely. Yeah. So it’s a mental shift as well as a financial shift.

[03:21] So the other thing that we’re going to touch on before we get to point three, so stick around. We’re going to talk about point three in just a bit, but cash flow. Now for you with cash flow, is there a number that you’re focused on or are we just going to talk is more of momentum and moving forward? What is it? Well, it’s a great question. So in our busting the real estate investing lies book, as an example, Jimmy Vreeland introduced the idea of a strike number. And I think that’s a cool number. And he identified a strike number as the bare minimum income that would just cover the critical things. And if you can create enough cash flow and he uses the term leveraged cash flow, as opposed to passive indicating that it still may take some work.

[04:12] But if you can create enough leveraged cash flow to pay your bare minimum expenses, not this awesome lifestyle that you want to have, but just the bare minimum expenses, that is your strike number. And that’s a fun goal to go after. And I think more attainable for a lot of people than paying all the expenses for their full lifestyle. So if you’re numerical, there you go. There’s a number for you. That’s a good point. And I think what for some of our listeners that are just learning about this new way of thinking and cash flow, it can be setting up an appointment and going over alternative investments, or it could be looking at different things that is bringing in a cash flow without you having to expend your time, correct?

[04:59] Well said. Yes. So we do have alternative investments that create cash flow. It is absolutely true that creating cash flow from your assets is one of the hardest things to do in personal finance. And again, just like we talked about in point one, which was cash. In point two, which is cash flow, most typical financial advisors, financial planners, types do not handle or create or work with or help you understand cash flow very well. So both cash and cash flow are just things that your typical financial planner is not skilled at helping you create and build and store and grow and work with. So we’ve covered cash and cash flow. Drum roll, please. Let’s hear what number three is. Yes. Absolutely. And it’s going to come with a bit of an eye roll and a yawn. So I’m just going

[05:55] to prepare you for that. And yet, it is one of the most important things around building prosperity, maintaining a prosperous mindset, having your cash and your cash flow and your other assets that are probably more growth oriented, focused, and it’s organization. Point three is organization. So as you head into the end of the year, let’s work on having things organized. So what does that mean? Like what am I talking about? It means having a decent system in place for as simple as your online banking. It means having passwords stored and backed up and in a form that somebody else could get to if you are unavailable or unable to talk about usernames and passwords, like if something happens to you. It means having a method where you’re scoring yourself, tracking things,

[07:00] paying attention to the improvements that are going on in your personal finances. It means also having your taxes in order and the preparation of those taxes, because if you’re going to do any tax work for 2019, now is the time. October, November, December of 2019 is the time to do work for 2019, not January and February of 2020. And so all of these things fall under the category of organizing. And no, it’s not fun. And yet, yes, it gets results. Absolutely. You know, there’s another part of organizing that I thought of, and we may have to do another episode about this, but it is getting your estate in order. Absolutely. And it is part of this because getting your estate in order is the passwords.

[07:56] Getting your estate in order is understanding who owns all the various assets that you have. Are they single named or are they joint named or is there a beneficiary named? All of those things are part of that estate that you are bringing up. And it’s so relevant. And so many of us are walking around without either a basic will or without a trust or maybe the documents that we have are horribly out of date, which those almost might be worse than not having anything. I’m not sure. And we have solutions for this. We have an attorney that works nationwide that can do all of the work over the phone and the web. And sometimes he needs to coordinate with a local attorney, but we can still get the job

[08:45] done. We have other things that we can recommend in the form of support for this space. And I’m really glad you brought it up, Spencer. It would be fun to do a whole other podcast on. And yet in the meantime, just getting some of the other aspects prepped will contribute to the expediency with which you can get your estate organized. That’s so true. You know, it’s funny when we look at this episode and we talk about the three things, which has been cash, cashflow and organization. These are all things that we want to say this. When we absolutely need it, we wish we would have done it sooner. So well put. Yeah. Somebody asked the other day, you think it’s hard while you’re alive and well to do the organizing, the collecting, the data gathering, et cetera, that needs to be

[09:40] done. Think about how hard it would be for somebody else to have to do it if you were not alive and well. So true. So true. So with one quarter left, it’s wonderful for us to get some clear focus, some strategy on what to do. Yes. One of the things that I would highly suggest our listeners to do is as you’re here listening to this podcast, you’re already putting the right things into your mind. You’re already thinking, taking action, taking that first step is the hardest, but it’s the one that will propel you to move forward. I would say if they need more clarity or if they want to figure out exactly how to get that cash flow or how to be organized, reaching out to you is one of the best things. What’s the best way to reach out to you, Kim?

[10:34] Hello at partners number four, Prosperity.com is a dedicated email for our podcast listeners. So whether you’re a client of our firms or not, I welcome emails on there that ask specific questions that I can give you a specific answer to. I’m more than happy to do that. And at that email is also a really good place if you are an accredited investor and you’re interested in still making an impact on your taxes before the end of the year, but you’re frustrated with the typical advice, which is to fund 401k plans and IRAs and that kind of thing. That’s a good place to email me for some information about a space that can actually impact your taxes in a big way. So whether your question is simple, whether it’s

[11:20] about cash, cash flow, organization, or tax deductions, hello at partners number four, Prosperity.com, best way to get an answer. Perfect. Well, thank you for listening to the podcast and being a part of this with us today. Make sure you are subscribed so you get the next interview. Thank you for listening to the Prosperity podcast. To take control of your money and have it work for you, visit us at partners4prosperity.com. If you liked this episode, make sure you subscribe and leave a review.