For many professionals and families I meet with, an important part of financial planning involves determining how to allocate excess cash flow. In this newsletter, I am going to touch on the five of the most common questions I receive from individuals in their peak earning years along with considerations for each.
1.Should I Pay Off Debt or Invest?
Many households have multiple streams of debt. Commonly this includes a mix of low interest rate debt, and high interest rate debt. When working on the decision of paying off debt or investing extra money, I examine the interest rate, effect of monthly payments on cash flow, and the current financial position of the client.
2. How Much Cash Should I Keep In Savings
It is not uncommon for me to meet with people who excitedly tell me about their high balance in their savings account. While this is awesome and shows true dedication, there are financial considerations to help decide when you have “too much cash.”
3. Should I Max Out Retirement Accounts First?
Many professionals ask me, “what is the best order for saving and investing?” Unfortunately, there is no “best order,” but there may be an order that is the best option for staying on track with your overall financial goals.
4. What Should I Do with a Bonus or Windfall?
Bonuses, inheritances, and large commission checks often create decision fatigue rather than clarity.
5. Should I Pay Off My Mortgage Early?
Many homeowners debate whether peace of mind outweighs potential investment growth.
Financial planning is rarely about finding a universally “perfect” answer. Most decisions involve tradeoffs between flexibility, growth, taxes, security, and personal priorities.
My goal with clients is to help them evaluate financial decisions and use their resources intentionally in a way that aligns with their goals and priorities.
For help mapping out a plan for your excess cash flow, follow the link to schedule a free consultation today!