How to Have Powerful Choice & Control over Your Financial Future - A 2016 New Year’s Resolution


So much was going on in 2015!

We had an interest rate increase for the first time in six years, which was kind of record-breaking.

We’ve also had some horrible things happen like the terrorist attacks. We also witnessed the rise of ISIS and the dangers of them coming over our shores; some of them are already here.

There are many tensed things such as the market swings that we’ve seen especially the last quarter of this year. It was a pretty much flat stock market year over year, but we’ve seen a lot of volatility increase because of low oil prices, the terrorist attacks, the unsettling of the Middle East, Russia’s flexing and some of their muscles, and a lot of other outside influences.

We’ve also seen the government’s rising interest rates, the Affordable Care Act, higher insurance costs: all these things just kind of put everybody on edge this year.

Now, I want to challenge you. This 2016, I want to have some New Year’s resolutions that maybe you could attach to your list.

That is… this 2016, with the attitude of “I am going to have choice and control over my future”, how would you do that? How do you have choice and control over your future when it comes to your finances?

The first thing to do in order to have that choice and control is actually by knowing what you have, how it works, and how it affects you. I call this cleaning the “Financial Junk Drawer”. That’s when you’re working to accumulate all your assets by putting money in your:

  1. 401(k)
  2. Roth IRA
  3. Regular IRA
  4. Government pension
  5. Thrift savings account
  6. Teacher retirement fund
  7. Social Security
  8. Life insurance
  9. Annuities
  10. Real estate investment trusts
  11. CD’s
  12. Mutual funds
  13. And more

We accumulate those things because that is why we are working. We want to be good stewards of our money. We want to invest smartly. A lot of times we just pick these things up because the financial guy, the accountant, the insurance guy, or a friend at work told us to do so. If you just accumulate all these things, you got this little junk drawer. That Junk Drawer isn’t coordinated. What I am trying to say is that you could end up with one foot on the brake and the other on the gas with your finances because your investment accounts, your insurance products, your annuities, and more aren’t working together to create the financial end result that you would like to have.

What we do here at East Coast Tax and Financial Planning is we have a system called COAST. The objective of this system that I designed is to organize and coordinate everything in your Financial Junk Drawer. We follow C.O.A.S.T. process.

  1. “C” stands for Certainty of Income

If you have a Financial Junk Drawer, and maybe you are not retired yet trying to figure out how to get all those buckets of money you’ve accumulated and distribute those to yourself. You are now leaving the accumulation phase and going into the distribution phase. You now need to have a plan that develops a certainty of income. If you don’t take anything away from this, imagine this: providing certainty in your life allows you to get an incredible amount of spontaneity. If I have certainty of income and I have predictable paychecks coming in when I’m retired, I know that it’s going to come in, month in and month out. If I have put some safety nets and guarantees in there, then I can be spontaneous. I can go on a cruise, or take that trip to Europe, or go on that bucket list trip to see Taj Mahal. You can do whatever you want to do. Maybe there’s a good travel deal somewhere, I can decide at the last minute because I’ve created certainty in my financial plan.


  1. Now we go to On Demand Cash

What does that mean? I call it Pillow Money. It’s for the unexpected, yet expected events that could happen in life. I’d like to have a certain amount of money so I can sleep well at night on my pillow. I know that 24 hours a day 7 days a week, I can get access to a certain amount of cash because that gives me security knowing that if something pops up, I could do that. Don’t ever let anybody tell you that number, because that number belongs to you. Be reasonable about it, of course, but just liquidity. I am a business owner and we have teenagers at home; people are getting ready to go to college, and a lot of other different things… So, I have a lot of unexpected and yet expected events. Things like air-conditioners at the office or at home that could go out, car tires, the need to get a new car; with all of these different things you need to be able to react and have liquidity. That’s a big thing to make sure that you have, and don’t ever let anybody talk you out of having the number that you need to have in order to feel good.


  1. Asset Protection

Now we’re going to protect each other. We’re going to make sure that we’re going to take a look at the “what if’s” in life. What if we lose a spouse prematurely? We know that we’re going to lose Social Security at least one of the two, right? We need to keep the higher of the two reflecting Social Security. What does your pension survivorship look like? How are your beneficiaries on your IRAs; are they updated? Is your 401(k) or annuity updated? Are you protected in case there is a long-term care situation? The statistic now is one of every two of us is going in for long-term care. When you look at the state of long-term care here in the state of Florida, full-time 24-hour nursing care facility spending is about $70,000 a year. That is not a small ticket. Average time in a facility is three years before we leave this planet. That is a lot of financial draining, are you prepared for that? Do you have an umbrella insurance polic? If you have a good size net worth, you should have an umbrella policy. A lot of times, car insurance companies don’t give you the proper coverage for the amount of damage that could be done. If you run in the back to somebody on accident, or God forbid you kill someone, your assets need to be protected. That needs to be analyzed.


  1. Strategic Growth

So often, people start with this: “I need to grow my money!” The secret to being wealthy and staying wealthy, and getting to wealth, is not necessarily the right stock picks that you choose, the mutual fund that you invested in, or the broker that you have. It’s your 20, 30 or 40 years of hard work and saving prudently, and then making smart decisions of keeping your money. Warren Buffet has this saying, “The secret to making money is not losing it.” The stock market shouldn’t be the everything in your financial plan, shouldn’t be relied upon your for income, protection, liquidity, or unexpected events that can happen. That is basically the engine that’s humming behind the scenes which is trying to keep up with inflation, and make good, sound investment decisions so that you can grow your money.


  1. Tax Efficiency

You should take care of those other elements first. What we do with that is we always make sure to look through the tax lens. We need to make sure that whatever investment or income decision you’re making; you need to view it through the tax lens, and have it make tax sense. If you are paying unnecessarily high taxes because you are making investment decisions that you think are good (and maybe they are good investment decisions), but you’re having to pay through the nose in tax, then you need to have one foot on the gas and one foot on the brake.

C.O.A.S.T. – Certainty of Income, On Demand Cash, Asset Protection, Strategic Growth, and Tax Efficiency. That is our process.

That is something that you can follow this New Year. If you would want to take us up on a complimentary consultation to see how we might be able to help you with that, give us a call 772-774-7970. Or got to our website for the Financial Pulse Radio Show You can go in there and register for a complimentary consultation. Also, get on the books or tax season. We have a tax preparation firm here as well, so if you need your taxes prepared, or if you’re a business owner and you want to make sure everything is being done properly give us a call 772-774-7970.