Financial Crossroads Success Tools

 

The Financial Crossroads:

The Intersection of MONEY and LIFE
There are an endless number of books that tell you what to do with your money. There are even more books that tell you how to, and how not to, live. Why is it that these two things that are so inseparable, money and life, are only addressed separately? This book addresses the intersection of the two. This is not another financial how-to book, nor is it a collection of philosophical rambling that is hard to apply to daily life. It is the Timeless Truths of personal finance. Many of these have been forgotten, destining so many into financial hardship, but they are the essential foundations for your successful financial future.

 

The Financial Crossroads
by Jim Stovall

We make decisions every day that greatly affect how we live now and into the future.  We are at a unique time and place in the economy in which there will be decisions made, individually and collectively, that will have an impact for generations to come.

The Financial Crossroads is the title of my latest book that I coauthored with Tim Maurer.   Tim Maurer is a financial planner with all the credentials and expertise you would expect from such an individual, but that is not why I agreed to write a book with Tim.  I agreed to coauthor a book with Tim Maurer because he understands the relationship between money and life.

He hosts a talk show in the Baltimore/Washington, DC area and makes guest appearances on many national media outlets.  I believe Tim’s expertise is in viewing money as a tool necessary to live your life instead of viewing your life as a resource to make money.

The subtitle of the book is The Intersection of Money and Life.  When we divided up the project of writing The Financial Crossroads, we decided Tim would write the Timely Applications, and I would write the Timeless Truths.  Both are necessary if you are going to succeed with money.

 We will share some of the concepts from the book here for you.

Chapter One: The Power of Money
Money is the most misunderstood commodity in our society, even on our planet. People today understand the price of everything and the value of nothing. There have been more conflicts, divorces, and disputes over money than anything else. In order to begin to have healthy attitudes toward money, we must understand that it is nothing more——or less——than a neutral tool or vehicle…

(Financial Crossroads Chapter 1 the PDF of the complete Financial Crossroads Chapter One)

 

Financial Crossroads co-author, Tim Maurer, featured on CNBC: (Click here to watch)

 

Financial Crossroads featured in Kiplinger’s (Click here to read)

 

 

“If you are ready to make your life work magnificently and have money flow into your experience–read this masterpiece and share it with those you love and care about.”

~ Mark Victor Hansen, co-creator, Chicken Soup for the Soul

“in my 38 years of banking, I saw thousands who could have avoided financial and life problems by reading the material in The Financial Crossroads by Jim Stovall and Tim Maurer.”

~  Don M. Green, Executive Director, Napoleon Hill Foundation

“Tim Maurer and Jim Stovall have produced a book filled with insight and utility.  We would all do well to heed their lessons.”

~ Dr. Carl J. Schramm, President and CEO, Ewing Marion Kauffman Foundation

 

Excerpt from Financial Crossroads chapter
Portfolio Management: All Things Considered Equal:

Have you ever heard anyone say, “All things being considered equal…” and then follow it up with a statement?  They may just be an economist.  It’s like saying, “If everything happens the way I expect it to, I’ll be home on time for dinner.”  It’s really an out.  In economics, enormous models are created with assumptions too numerous to count, and the aforementioned phrase gives the economist an out when circumstances beyond his or her control change.  This phrase is especially important in the management of investment portfolios.

All things being considered equal, stocks are more risky than bonds.  Growth companies, more risky than value companies. Small companies, more risky than large companies.  International countries and companies, more risky than the United States and companies domiciled here.  In investing circles, each of these categories is called an asset class.  If all things were equal, the above presumptions would hold true.  But, especially in the world of investments, all things are never equal!  They’re in a constant state of flux, and as Mark Twain told us, “History doesn’t repeat itself, but it does rhyme.”

Departing momentarily from theory into reality, consider the notion that instead of risk being determined by asset class, risk is determined by the price of that asset.  The risk of a particular asset is not correlated with its label, but instead, its price tag.

*********************************
Excerpt from Financial Crossroads chapter
Money and Health:  Timeless Truth

With rampant credit card overspending, the sub-prime housing crisis, and ridiculous long term automobile leases, most people assume poor spending habits cause personal bankruptcy.  In reality, the number one cause of bankruptcy in our society today is medical bills. 

For most people, it is not a matter of if but when you will need major medical coverage.  And if you’re one of the lucky ones who never uses your health insurance, HOORAY!  I would be very pleased to pay the fire insurance premium on my house and never use it.

If you are earning part or all of the income for a young family dependent upon your ability to work, you need to realize that you’re more likely to become disabled than to die.  Most people understand life insurance is important, but they don’t realize that disability insurance is critical.
Finally, there is a flaw in the way people look at long term care between them and their spouse.  There is a serious danger I like to call the second spouse syndrome.  People who fall victim to the second spouse syndrome assume they will be able to take care of each other in old age.  In most cases, one spouse does not have the ability to take care of the other and, obviously, at some point one of you is going to pass away, leaving the other one alone. 

The second danger in second spouse syndrome assumes that one nest egg will be adequate to take care of both spouses.  Too often, a spouse dies at the end of a long debilitating illness.  It is not unusual for that spouse to deplete a sizable nest egg in the last several months of life, leaving the second spouse destitute when it comes to their long term care needs.

None of us want to think about the issues represented by health, disability, and long term care insurance; however, if you don’t face it as a statistical exercise now, you will face it as a daily reality later.

You will work very hard to earn, save, invest, and manage your resources.  Make sure that one of life’s inevitable bumps in the road doesn’t derail you and your family financially.

~ Jim Stovall