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Your Money Lifestyle Is Just A Cash Flow (Nov 09)


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Managing cash flow effectively is an important key to a steadily growing net worth.

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Your Money Lifestyle Is Just A Cash Flow (Nov 09)

  1. 1. On Wealth Management Your Money - It's Personal ~Quick Takes On Making The Most of What We Have ~ Silver Oak Wealth Advisors manages client assets, along with the financial decision-making concerning all of the client's financial resources and obligations toward realizing their vision for the future. If Lifestyle Is Just a Cash Flow, Then Joel Framson & Eric Bruck, Debt Can Stop the Flow Principals   Quick! Name one point of focus for gauging the "The prime purpose of progress of your life-long financial goals! Where Wealth Planning & Management would you look? is to enable our Client to create and sustain Given the hurricane of financial stress our a better life." finances have endured over the past year, it is even more vital that certain simple principles are remembered and observed. Silver Oak Wealth Advisors, LLC Many pieces of the puzzle we recognize as our Click here to learn more financial life are crucial to our financial well about Silver Oak... being in their own rights. Plus, importantly, each area is uniquely dynamic, interacting and   impacting on every other based on our daily financial decisions. The single most important guage, simply stated, is the growth of equity relative to debt, i.e., the growth of personal net worth. Debt Can Be An Albatross Lifestyle needs in retirement (net of Social
  2. 2. Security and other fixed income streams) will be funded from net assets. Any debt service added to lifestyle expenses adds demands on a portfolio and thus limits the safe level of spendable income it is able to generate. Debt can be the albatross that holds down accumulation or preservation of net worth and weighs heavily on fiscal and emotional peace of mind. There are two basic keys to avoiding the debt trap. 1) Spend less than you earn (no matter how tight things become during tougher times); invest/save the difference to grow net worth according to a financial plan to the level that can secure financial independence. 2) Do not borrow without: a) a finite (short) payoff plan, or b) earmarking the proceeds for a specific purpose involving investment leverage. An expected return should significantly exceed the cost of borrowing, and the term of debt service should be predefined. Every financial decision and action impacts net worth. Daily spending decisions and actions result in a monthly surplus or deficit and, ultimately, impact your retirement security. As always, please feel free to call or e-mail us with any questions. Best personal regards, Eric & Joel