A few years ago, I sat across from a couple at my desk.
They were in their “messy middle.” Both worked full-time. They weren’t living extravagantly, but they weren’t exactly sure where all their money was going either.
They’d saved some over the years, sporadically, nothing consistently or intentionally, each month.
And then life happened.
A forced job change. A car that needed replaced. A child they wanted to help in college.
It wasn’t that they made bad financial decisions. But because they didn’t have an intentional savings plan, those curveballs hit a lot harder than they should have. They had to hit pause on saving for retirement, pull from savings they were hoping wouldn’t need touched, and scramble to rework their plan.
They came to me feeling behind and defeated.
We sat down, laid everything out, and worked backwards. We figured out two numbers, just two, that changed the entire direction of their financial life:
1. Their Savings Rate
Your savings rate, in my opinion, is one of the most important numbers in your financial plan. Not just because it fuels your future, but because it lets you know you have margin in your day-to-day life.
Without margin, you could be one unexpected event away from stress, debt, or difficult choices.
I believe a good savings rate means you're not only building for the future, but you're living with breathing room today. It can be a start in you creating stability. And freedom.
So for this couple, we calculated what they needed to be saving, not just for retirement, but for their shorter-term goals too. I’m confident that clarity gave them direction and confidence.
2. Their Work Optional Number
We also figured out their work optional number, the amount they could need to have saved to walk away from work if they wanted to.
It was like giving them a finish line.
Before, they were saving without really knowing how much was “enough.” That uncertainty made it hard to balance enjoying life now versus preparing for the future.
Once we had a number, I think everything changed. They realized they were closer than they thought, but needed to tweak their savings rate to stay on pace.
And just as importantly, they realized they didn’t have to put off everything for retirement. We made it intentional that some of their savings would be used to enjoy life, travel, hobbies, and experiences with their kids, while still making progress toward their long-term goals.
You don’t need to track every detail of your spending to get your finances on track.
But if you don’t know these two numbers, your savings rate and your work optional number, one could argue it’s like driving without a map or a fuel gauge. You might get there eventually… or you might run out of gas halfway through.
Knowing and updating these numbers can be transformative. These 2 numbers can be crucial in how you create a financial plan that’s not just about the future, but also about living a better life today.
If you’re ready to figure out your two numbers and help get some clarity about your plan, let’s set up a time to talk by clicking the button below.
You don’t have to keep guessing.
Let’s bring your financial plan into focus, together.
Additional Disclosures: The material contained in the newsletter is for informational purposes only and is not intended to provide specific advice or recommendations for any individual nor does it take into account the particular investment objectives, financial situation, or needs of individual investors. This material is not intended to provide and should not be relied on for tax advice. Any information contained herein is of a general nature. You should seek specific advice from your tax professional before pursuing any idea contemplated. The information provided has been derived from sources believed to be reliable, but is not guaranteed as to accuracy and does not purport to be a complete analysis of the material discussed. All examples are hypothetical and are for illustrative purposes only, individual results will vary. Securities Offered Through Valmark Securities, Inc.Member FINRA, SIPC Investment Advisory Services Offered Through Valmark Advisers, Inc. a SEC Registered Investment Advisor 130 Springside Dr., Akron, Ohio 44333-2431*1-800-765-5201 Spearman Financial Services is a separate entity from Valmark Sercurities, Inc. and Valmark Advisers, Inc