Well Being, Well Done A Project of the Sudden Money Institute
Well Being: A profound state of being found at the intersection of Life and Money. You can have it before you have accumulated large amounts of money. You might not have it even if you already have great wealth. You won t lose it when life changes. Page 2 of 30
Well Being, Well Done A Workshop for Women Ready to Explore their Path to their Best Life Your Well Being is a dynamic state, ebbing and flowing as your life moves. It is a very personal experience, one which you create and protect through the choices you make. The experience of Well Being is both subjective and objective. There are aspects you can feel and those you can count. Both are equally important. Your finances play a role, but ultimately the experience of Well Being is deeper and, in many ways, more controllable than your net worth. This program is an introduction to the six aspects that make up Well Being. Cash Flow Family Wellness Net Worth Vision Security Vision Page 3 of 30
Again, Well Being is both subjective and objective; there are aspects you can feel and those you can count, and both are equally important. Your Well Being is a dynamic state, ebbing and flowing as your life moves on. It is a very personal experience, one which you create and protect through the choices you make. Subjective Objective Think of a time when you felt a great sense of Well Being. What was going on, how old were you, where did you live, and what was the primary reason you felt this way? What words or phrases would you use to describe Well Being? Page 4 of 30
Security Cash Flow Vision Family Net Worth Wellness Well Being is deeper, more sustainable and ultimately more important than any one aspect of personal finances. Page 5 of 30
Security Cash Flow Vision Well Being Family Net Worth Wellness Cash Flow the money that flows in and out of your life everyday Family the ability to create a loving and supportive family life, meet your obligations and responsibilities, and make good estate planning decisions Wellness the enjoyment of the benefits of good health, and the ability to work and play as you wish, both physically and mentally Net Worth the balance of what you own and what you owe; the ability to make sure your net worth grows for your enjoyment, your support and to be shared with others Vision the ability to build a life that reflects your values, fulfills your dreams, and is fueled by your inspiration Security The feeling of safety now and when you look into the future; created by the use of insurance, saving for emergencies, investing for the future and the support of friends and family Page 6 of 30
Cash Flow Security Cash Flow Vision Family Net Worth Wellness Lighten the load or strengthen the donkey. Inflow (income) Outflow (expenses) = Left over Controlling expenses is the single most powerful thing we can do to manage our personal finances. Know your numbers. How much money goes towards your home? Which expenses are fixed and which are optional? Cut back on the optional expenses when income goes down or to make room for something important. Cash flow is a combination of your inflow, your outflow and what is left over. Page 7 of 30
Net Worth Security Cash Flow Vision Family Net Worth Wellness Not all things that can be counted count. Not all things that count can be counted. The two essential ingredients Knowing how to place value on what counts in your life is essential for Well Being. When measuring your net worth, give yourself a reality check on your assets and strengths, as well as your debts and personal struggles. The two essential ingredients to grow both sides of your net worth are a clear set of goals and a plan to achieve them. It takes time and persistence to build both sides of net worth. Page 8 of 30
Security Security Cash Flow Vision Family Net Worth Wellness Resilience is the secret to security. The nature of life is change. We don t control change but we can control our response. Rather than resist change, know your perfect storms, plan for them and then let go. You have six choices to create security: buy good insurance, self-insure, accumulate financial assets, rely on family and friends, hope life just works out, and all of the above. Page 9 of 30
Wellness Security Cash Flow Vision Family Net Worth Wellness Your health is either self-generated or self-inflicted. Good health is built and protected over time. Rather than using your health insurance as sickness insurance, expand your ideas of self-care. Self-care can include: fitness, massages, supplements, yoga and more. Do the easy things: floss your teeth, get regular exercise, drink clean water, stretch every day, avoid the bad stuff and eat small portions of the good stuff. Page 10 of 30
Family Security Cash Flow Vision Family Net Worth Wellness Money issues can form loving bonds. Working through the initial challenges of talking about money in an honest, caring way is a lasting gift that can hold families together for generations. Regardless of the amount of wealth involved, it is important to have a family process for discussing all topics that impact the members of the family. When tough family issues come up, such as health care, estate planning, money management and education, you will have a much easier time making decisions if you have had positive experiences working together in the past. Page 11 of 30
Vision Security Cash Flow Vision Family Net Worth Wellness Is it really about the numbers? Financial decisions are rarely just about the numbers. We all make important financial decisions for non-financial reasons. The numbers are what we can see, but our choices and decisions are greatly influenced by the unseen undercurrent of our beliefs, fears, hopes, dreams and inspirations. Page 12 of 30
Aspects of Well Being Rank by importance Rank your confidence level Action needed Page 13 of 30
Choice by Choice Choice by Choice we have built the life we are living now, and Choice by Choice we get to build our future. The good news is we get to choose what counts. Explore your expectations in life, know how to stress test your goals and finances, and build a relationship with the right advisor who will help you stay focused on enhancing your Well Being, one great decision at a time. Page 14 of 30
Well Being, Well Done Worksheets Page 15 of 30
Well Being Worksheets This workbook is for you, designed to help you address and enhance every aspect of your Well Being. This is your opportunity to take a closer look at your personal Well Being and begin to take action with the guidance of your professional advisors. There is a worksheet section for each aspect of Well Being, followed by critical questions to ask yourself, and space to begin your Action Plan. The Action Step section has two big questions: what do you need to do and what do you need to learn. It s helpful to organize your Actions Steps into timelines so you don t feel overwhelmed by the number of things to be done immediately. The first level of organizing can be done in three categories: Now (N), Soon (S) and Later (L). Then, if necessary, go to the second level of prioritizing with N1, N2, N3... Page 16 of 30
Cash Flow Worksheet ANNUAL OUTFLOW Where does your money go? - Mortgage/rent - Homeowner association - Home repairs - Utilities - Car payments - Insurance Auto Homeowners Health Life LTC - Tax Income Property - Food - Education - Entertainment - Travel - Gifts - Donations - Clothes - Self-care - Saving - Retirement plans - Other Total Annual Outflow ANNUAL INFLOW Where does your income come from? - Earnings W2 income Bonuses Commissions Speaking fees Royalties - Investment income - Trusts - Family partnerships - Business - Inheritance - Alimony - Child support - Gifts - Other Total Annual Inflow LEFT OVER Total Income (Inflow) - Less Total Expenses (Outflow) = Net Cash Flow Page 17 of 30
Critical Questions: Where does the leftover go? If negative cash flow, where does the extra money come from? What could cause your income to increase? What could cause it to decrease? What will inflation mean to your cash flow in the future? How much will you need to keep your lifestyle? Can you project your future income and expenses? I need to do Action Steps I need to know Page 18 of 30
Critical Questions: Stress Management Relaxation/meditation Free time Spiritual practice Exercise Laughing Do you know your biggest causes of stress? Do you know how to reduce your stress level? Physical Maintenance Fitness Management Set annual fitness goals Fitness routine Strength & cardio Flexibility Endurance Does fitness contribute to other areas of your life? What disrupts your fitness routine, and what might you do to prevent this from happening? General Practitioner Dentist Dermatologist Other Other Page 19 of 30
Critical Questions: How much is good health worth? Example: if you earn $100,000 per year and you will work 20 more years, your health is worth $2 million before inflation. What would you do if you had a serious health challenge? How much more money will you need to have for retirement if you have one of the five most costly common diseases: cancer, heart disease, obesity, diabetes, and arthritis? Some studies say you will spend an extra $250,000 on medical care if you live to 90-years old. What is the one most important change you could make NOW to improve your health? What is the dollar value of that one change? I need to do Action Steps I need to know Page 20 of 30
Net Worth Worksheet #1 What do you own? - Assets - Savings - Investments - Retirement plans - Company benefits - Trust assets - Home - Autos - Investment RE - Other - Other - Other Total Assets Are your assets growing? What do you owe? - Debts - Home mortgage - Auto loans - Education loans - Home equity - Credit cards - Investment RE Total Debts Are your debts increasing or decreasing? What debts would you pay off first if you had extra money? Which assets are most predictable? How important is it to you to be debt free? Why? Which assets are depreciating? What assets do you rely on for the future? Page 21 of 30
Net Worth Worksheet #2 Financial Net Worth Total Assets Less Total Debts Equals Net Worth Future net worth goals: 1 year 5 years 10 years 20 years Non-financial Net Worth Strengths Education Talents Marketability Relationships Creativity Contributions Network Struggles Page 22 of 30
Critical Questions: What is your plan to build your financial net worth and your non-financial net worth? What can you do to make the biggest impact in the short term? What can you do to have the best long-term impact? How does your financial net worth feel today, and how do you want it to feel 20 years from now? I need to do Action Steps I need to know Page 23 of 30
Family Worksheet Provide and Protect Insurance Life Income replacement Health LTC Support Systems Kids educations Parents care Other Transfer While Living Power of attorney Medical guardian Financial guardian After Living Wills Trusts Beneficiary education Trustee appointments Guardian for minors Legacy Family values Family story Family history Page 24 of 30
Critical Questions: Can you easily discuss money with your spouse, children and parents? Do you have a Family Game Plan for emergencies, including who to contact and where to meet? Do you need to consider buying LTC insurance for your parents or others for whom you might become responsible? Do both you and your spouse understand the family finances, meet with your advisors together, and know where all important documents are kept? I need to do Action Steps I need to know Page 25 of 30
Vision Worksheet Beliefs and Values Core beliefs Values How have your values and beliefs been influenced by your parents? What beliefs and values have remained consistent throughout your life? Inspiration What are you most excited about? Where does your inspiration come from? What inspires you to reach higher and accomplish what might have seemed impossible? How would someone know you are living an inspired life? Vision-based Action What financial decisions have you made based on your values, beliefs or inspiration? If finances were not an issue, what choices would you make to move you towards a more purposeful, inspired life? How do your sharing and charitable commitments reflect your vision? Page 26 of 30
Critical Questions: What is really important to you in life? What do you want to be remembered for in life? What is the change in the world you d like to see? How do you connect your financial resources to that outcome? What unique ability do you have to share with the world? I need to do Action Steps I need to know Page 27 of 30
Security Worksheet You create your own sense of security through the use of insurance, financial assets, and the safety net of family and friends. It s knowing you ve done everything you can to cover your risks and create a safety net that allows you to be fully engaged in life. Insurance Home Cars Health Income Disasters Personal Liability Professional Liability Long-term Care Do you know the amount of coverage you need for each category? Do you have insurance professionals guiding you and reviewing coverage each year? NOTES: Emergency funds Amount Where is it kept? How have you determined the amount? Is this the right amount? Money set aside for unexpected expenses, illness, drop in income or to help others. This money is usually kept in a money market account or short-term CD or bond. NOTES: Page 28 of 30
Critical Questions: List the members of your personal support team: Whose team are you on? Is there anything you can do to make it easier for your support team if you should need their help? Is there anything you can do to make it easier for you to support someone? I need to do Action Steps I need to know Page 29 of 30
Well Being Self-Evaluation All six aspects are important, but if you had to rank them by order of importance, which ones would be number one and number two? What is at the bottom of your list? -We all have strengths and some weaknesses. On a scale of one to five, with five being the best, how confident are you about each aspect of your well being? -Which aspects do you manage on your own, and which ones involve reliance on professional advisors? Page 30 of 30