Avoiding the Road to Financial Ruin

Have you ever stopped long enough to notice how many tools we have to assist our road travel these days? From traditional traffic lights and road signs to programmable electronic billboards, GPS, and a bevy of smartphone apps for every conceivable situation one might encounter on the road. The sheer volume is staggering. We are better informed and more equipped for travel decisions than we have ever been before.

But what about financial signposts? How can we tell if we are doing the financial equivalent of driving the wrong way down a one-way street? In a vehicle, you'd find warnings from street signs, traffic flow, your GPS, your smartphone, and likely your passengers as well. But when it comes to financial decisions, we don't typically enjoy the same amount of resources to inform us. Here are a few indicators that you may be traveling in the wrong direction with your finances.

Warning Signs:

•If you cannot tell how much you currently owe without having to look it up

• If you have rolled your credit card balance more than twice

• If you fund your vacation with the money you will earn when you get back

• If you do not know how much you should be saving

• If you do not have 3 (preferably 6) months of income in cash reserves

These are not condemnations, but rather they are things that should trigger some alarm bells for you that it's time to address the way things are going. Just as if you were to turn the wrong way down a street, there are indicators prompting you to take action before the situation deteriorates even further. To do something before it's too late, and you are beyond the point at which actions can still affect the outcome. Remember that there is a difference between being on the road to financial ruin, and being financially ruined. There is a difference between turning the wrong way down a one-way street and continuing to travel in the same direction until you meet a collision that you may not be able to recover from.

Education is the difference maker in avoiding the road to financial ruin. A free weekly presentation will be available at the Whitehall Library every Tuesday night at 6 PM starting this upcoming Tuesday, September 5th. Please come and join me as we discuss:

• What is money?

• Understanding cash flow

• The effects of compound interest (good and bad)

Future presentations will include topics such as debt and borrowing, understanding credit, taxes, inflation and qualified plans, home wealth, and strategies to leverage debt.

If you are unable to attend the presentation live, I will have it posted to view at your convenience at http://www.treasurestateadvisors.com.