Time and time again I read that the Internet loves Top 10 lists. So in the interests of having more lovable things in the world, here ya go:
Top 10 Determinants of Your Current Overall Numeric Financial Health
1. Your Money-Out has always been considerably less than your Money-In.
2. A while ago you figured out an efficient and effective way to store and then maintain the excess of your Money-In over your Money-Out (this is a very neutral way of describing “investing”).
4. You were lucky enough to have bought a house before 2000.
5. You’ve taken advantage of auto-pilot savings programs, such as employer-provided retirement plans.
6. You are (or were) part of an industry that has (or did have when it counted for you) pension plans.
7. You were lucky enough to go to post-high school (also known as post-secondary school to Financial Wonks and education geeks) at a time, or in a way, that allowed you to get outta dodge without having racked up huge student debt.
8. You were lucky enough to never have something terrible happen to you (in John Friedman Financial parlance, your Come What May has never dealt you a brutal hand).
9. You are boring enough on paper (i.e. not self-employed, and yes long-term employed, either at one place or at several places but with no gaps, etc.) or wealthy enough to have gotten a re-fi since 2009.
10. To the extent you ever had an FSP — a Financial Services Professional — in your life, that person’s heart was in the right place and s/he had the necessary skills to be of good service to you.
On this last point, shame on all of us FSPs: shame on all of us that so many folks go it alone, making their ways through their financial lives without our help, either because of our business models (which emphasize working with HNWs and UHNWs and not working with normal folks) or because we FSPs, as a group, are not great at helping those folks understand that taking care of one’s financial life with the assistance of a caring, smart, value-add-all-the-time FSP just about always feels great and, by definition, is always cost-effective.
And one overall point: this list is about numeric financial health only. That is, these determinants go to what the numbers inhabiting your life look like. The main determinant of non-numeric financial health — that is, the everything-other-than-the-numbs part of your financial life — is the extent to which your economic self peacefully cohabitates inside of your you with all your other selves. I’ll have more to say about this in the weeks ahead.