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And welcome you are listening to watching the Financial Survival Network. I'm your host,
Carrie Lets. Financial Health. Well, that's like you should be concerned
about your physical health. You need to be concerned about your financial health.
But whereas eating can fix your personal health, your maximize optimize your physical health,
well, you've got to do something more for financial health. And with
us. Now we've got a new guest that I know you're going to really
get into her message. Esther has nets and Esther, it's great to have
you on the show. So how do you define of financial health? Because
physical health it's like what's your blood sugar, your A one C, your
cholesterol, your triglycerides. What's the equivalent measure for your financial health? Well,
first of all, thank you Carrie for having me. I really appreciate
being on the show. So financial health basically is when you really you don't
have to worry so much about how you're going to pay the bills. You
know, if you if you want to go to a nine stander, you
can afford to do that. You're not borrowing from Peter to pay Paul.
That's financial health the way I see it. You have money in the bank
if if something were to happen, you could afford to take care of it.
Should you lose your job, you've got money to live on for a
few months. You've got if you're not retired yet, you've got a good
start on it, so that at some point you're not going to have to
worry. To me, that's truly what financial health is. Okay, I'll
buy it. So you know, physical health is easier to measure than financial
health. What you're describing this kind of like, all right, so you
got six months of emergency expenses in the bank. All right, you're not
you want to buy something? You could buy it, like you said,
go out to dinner. You know that's getting more and more expensive every day.
But it's harder to measure, though. Is there an objective measure for
it? I think it's how you're sleeping at night. That's how I measure
it with my clients. You know, how are you sleeping? Are you
up all I worrying about paying the bills? Are you concerned that you know,
you got a kid in college and he might have to leave because you
can't cover it and he's not covering it? Financial health? Are you worried
about your debt because that's a huge one, you know, is your debt
in order or are you really over ended and you don't know how to get
rid of some of that? And that's even growing, especially this year and
last year with the interest rates going up, and it's gotten way out at
hand. So you know, maybe maybe it's easier to know. I fear
financially unhealth because you're freaking out all the time. But it is so important.
Of course, if you are up all the time and you are nervous
and freaking out, as I would say, that is going to affect your
physical health and big ways for sure, for sure. So I mean,
I guess your advisory company, you help people build their financial health, build
your financial health. When you're evaluating a prospective client, what do you what
do you look for? Well, first of all, what's the debt and
how much you got how much are you bringing in? You know, money
and money out is obviously huge. And then once we take care of money
and money out, how much do you have for retirement based on how old
you are and when you want to retire, do you have other money that
might not be in a retirement account that you can get to is maybe you
need when you need a new car, or if your air conditioner goes out
in the middle of August. Those types of things we work on. And
then you know, of course, the next step is, well, we
got to grow your assets. How much risk are you're going to take,
and how we're going to invest it. But the first thing we look at
is the whole picture of who this person is, where they are financially,
what are the problems out, and what are the pluses, you know,
what are they ahead of the curve on? And then from there it's a
lot easier to move forward. Okay, And so just give us an example
of somebody who came in who is financially near rigor Mortis and you help,
you help, they're turn it all around. Um okay, So I've actually
had the talk up with the clients that were over seventy and I even had
one over eighty and I actually had to tell him, you got to get
a job. You are what you're gonna You're gonna run out of money,
and you need to get some kind of a side hustle somewhere. I don't
care if it's part time. Find something you like to do, but we
need to get you set, and we need to really you need to bring
in way more money. Not only that, but how many times are you
going out to eat? That's got to stop. You know, you need
to really be careful how you're doing this. How much time are you spending
on Amazon? That's a huge one. So it's it's tightening the belt,
it's bringing him more sometimes, and that's a really really hard conversation. And
I have I've had people commit with ten thousand dollars to their name that they
wanted to invest with me, yet they were over fifty five thousand dollars in
debt and they'd known anything. So it's like, you know, you can't
do this. You got to take a real hard look at yourself. It's
a you know out I understand you don't want to work, but at sixty
five years old, you're going to have to do something because this is not
going to sustain you. That's a that's a harsh financial wake up call,
isn't he Yes, it is. It's horrible, all right. So did
they listen to you? I don't know, and I haven't heard from him
again, you know. And sometimes as they were leaving, I said,
you didn't know about this, right, and they said, yeah, I
guess we just had to hear it. But we didn't want to hear it.
You know, we were hoping that you'd have a better idea, So
well, what are you supposed to do? But you know what, my
crystal ball doesn't always work and my magic wand is lost, so you know,
this is on view at this point. So in other words, the
thing to tell that person is the lottery is not a business plan or a
financial plan for success. Right, that's that's not your retirement. That is
not the lottery exactly. Think yet people are into not huh a lot and
you know, and then you get those that have plenty and they're afraid to
spend it. You know, you have the other side where they have all
kinds of body and you know they're still going to consignment shops or there are
shoes are roll you know, forty eecres. So it's like, do yourself
a favor. You could do this, you know you can afford this,
and they're they're afraid to spend anything, so and they are financially healthy,
and then so yeah, well they're like financially anorexic, feric you will.
You know, they're living in a scarcity mindset, which you know, living
beneath your means is really the best way that I've seen. They're really build
wealth and really have a great retirement. Unfortunately, I is never one of
those who could do it. I tried that, and then it's like,
what I try to help my clients with living beneath your means rather than living
outside your means. And you know they'll lease the car you can't afford it,
get something news do you know that kind of thing, and you know,
put money aside. Let's take x amount out of your checking account every
single month and start a plan that way so that you know you can grow
something to get started on. I don't care how old you are, it's
never too late to start your financial health and start digging yourself out and so
you could be more comfortable in the future. Yeah, Hey, it just
makes so much sense. So emotional maturity is a lot like financial maturity.
That is, you put off pleasure today or a return and get better tomorrow.
Exactly, exactly. Yeah, But getting people to see the wisdom of
this not easy. Sometimes they've already seen it again. They just need to
be get, you know, smacked in the face with its. Somebody else
has to tell them, you know, you need to get out and do
something. This is not working. It's not going to work. And you
know, if you're only bringing in twenty thousand a year and you are spending
forty thousand a year, you gotta know it's it's not gonna lie and you
got nothing in the bank. You know, you can't keep living off of
debt. And the big problem that I saw as the real estate was going
up is people were taking home equity lines on a value of their house,
which I believe was a false value. And now those home equity lines,
the interest rates have shot up, the houses are worth a little bit less,
and they got to pay off this debt, and they still aren't making
enough. You know, they'd making what they were making before when they were
living off the home equity. So it's a huge problem and it's out there
and it's going to it's catching up to a lot of people. Yeah,
and you went in debt to keep maintain your lifestyle and then you wind up
housing prices go down and you could be underwater. Correct, And it's your
lifestyle that's really underwater and you don't want to see it, and you need
to change your lifestyle. You need to save more, do less. If
you're going to restaurants f times a week and they're costing you one hundred and
fifty dollars a time, maybe I ought to stop doing that and seeing what
makes more sense, like eating home or at least going to lower price restaurants
once or twice, and that's it. Yeah, okay, all right,
well I'm not going to listen to you. But then again, probably not
the person you want is applying anyway. You know, it's certainly them living
beneath my means. Now, took me decades to get there, but one
day I just woke up. And sometimes though, does it pay to go
a little bit more than your means to get something that you think is going
to have a payoff in the future. Sometimes it might, but you really
need to think long and hard about it. I mean, if it's going
to break you, No, because you're never going to get there. But
if you see a possibility and you don't do it all the time, the
problem is once somebody does it, once I see them doing it, you
know, it becomes an abbot. Just like people that take money out of
their FO one case because they're not financially healthy, and so they take money
out of their for one case and they look at it like a piggy bank
and then it's gone. If you never take that first amount out, it
will be there until you retire. But once that first withdrawal happens, what
I see is it's gone, and it just becomes a piggybank. So the
whole thing of it is if you want to do something because you see it's
a it's an investment or whatever it is, one time is five, But
once it gets to be a habit then you're gonna put yourself right back under
water again. You got to be really, really careful. Yeah, So
you want to learn from your past mistakes, not to keep repeating them over
and over again, which so many of you out there do. Yeah.
So now you save this money, where are you putting it? Esther?
Well, since I'm a financial advisor, I generally put it in the stock
market hit by and then at this point, with a recession possibly on the
way, probably on the way, I've tightened the belt there and not getting
too aggressive and portfolios, but you know, again at this point, not
reaching for the trees and wanting to grow assets as much as maybe a couple
of years ago, but mostly locking it in, keeping it in the borings,
you know, big dividend paying stocks. And I'm adding to my bond
portfolio. Even though the interest rates are going to go up, I believe
it's only going to happen once or twice more, not that much. And
once recession its will drop them again. It'll be nice to have them in
there. So that's basically, you know, I keep it easy and mostly
you know, the regular liquid assets, and if things go worse than I
expect, I can just go right to cash. Okay, And where do
you keep your cash? Now? With the banking racists in full swing,
there are still very good banks and you know, I mean the clearing firms
are safe in liquid and it's not all it's a few banks. And I
mean I was in the industry back in O eight. You know, we
had some big ones go. And I think we learned a lot from that.
Where the government comes in just like they just did over the weekend and
find some big conglomerate be to come take it over and make everything sound again.
And no, I don't see that changing, and I don't see that
really being a huge problem this time. All right, for your mouth,
the one thing you should learn is that if Barney Frank is on your bank's
board, don't put money there. You be careful well, and again,
you know, the larger banks, you never you're not going to have a
problem with because they're you know, they're financially sound at this point. And
I don't see anything going on there, although not to say it can't happen.
I use Bear Stearns once upon a time, a long time ago,
so I get it buying company that no longer exists. Yeah, yeah,
But in all seriousness, well, Dodd Frank is dead, which is a
good thing because Dodd Frank embraced the whole concept that legislatively embraced the bailing concept.
And when you've got a system that's fraction or reserved, you can't you
can't ask the depositors to bail out the entity that they had no control over
whatsoever other than to deposit money into it. Right, that will destroy the
confidence whatever measure is left in the system and lead to a major financial collapse.
So I don't see that now. Um, I see, yeah,
I see big problems still with real estate to you know, and and the
loans. You know, these loans are the interest rates going up and the
people can't afford to pay that off. I see problems with you know,
other stuff. But as far as these banks go, Um, the one
bank that had all these treasuries, I thought that was brilliant. The government
buy the treasuries off of them, give them the cash they need, and
then they'll just hold on to them and keep the interest and actually make money
on the deal to bank stays, you know, solve it and everything works
in the end. There's different answers for different problems, but I think so
far they've been able to keep things pretty much moving forward, which is financially
healthy for all of us. Well, it's a mandatory because once there's a
loss of faith in the banking industry, that it's all over. Well,
yeah, you know, they should have dealt with sv SVB Silicon Valley Bank.
They should have dealt with it much faster. Shouldn't have been allowed to
collapse and on them, and that's a failure to learn from history. Hopefully
you're right. And the banking crisis, you know, it's always people are
is fighting less battle, so Ryan see, Hey, Esther, we want
to find out more about you, connect with you on the web. Tell
us the best place to find you www. Star financial Solutions dot com is
my website. Esther kus nuts est h e r k u z n e
t Z. My email is Esther eest h R at Star financial Solutions dot
com. CU right, all right, well, thank you Esther. We
appreciate you coming on. I've got a question for Esther and myself. Email
address is k l at Krelutz dot com and there'll be a link to esther
site in the show notes to this interview. Just go click the link and
you'll get her right there. And Esther really appreciate you coming on. We'll
talk to you again. Thank you for having me. It's been wonderful being
here with you and getting to meet you and all your listeners. Thanks for
listening to carry Lutz's Financial Survival Network, your solution today's trying times for the
latest go to Financial Survival Network dot com. Financial Survival Network now more than ever