Getting your Ducks Lined Up.

The average American consumer has 5.3 accounts across all types of financial institutions. Some have more than 20, and some might only have 2-accounts. But with each successive account, how does one go about tracking them all? Do you know the exact balance of your checking, savings, mortgage, credit cards, and car loan off the top of your head? If not, and you’d like to know, we offer a solution!

As Arktos Wealth Management has been providing clients access to holistic financial planning for more than 15-years, it was only about 7-years ago that we began to utilize client facing software to help both our clients and ourselves manage their entire financial well-being with up-to-date asset and liability account values. With this tool, we (both clients and I) are able to view a client’s entire financial status in real-time–including all investments, property, debts, and liabilities. Used in conjunction with the titling of assets, classification of the holdings, beneficiary designations, and cash flow, there is little that is unknown or undiscovered when a review happens.

Today, it is more important that ever to be on top of the status of your accounts. And I’m not just talking about potential fraud and misuse of your accounts. The Federal Reserve Bank of New York just released their 2nd quarter (2023) report on total household debt and credit card debt. American household debt (comprised of mortgage, student debt, auto loans, credit cards, and home equity) reached $17.06 trillion while credit card debt alone reached an all-time high of $1.03 trillion. With debt creeping up for most consumers, families should be the first ones to notice a bad trend, and to be able to address it.

According to TransUnion’s most recent Credit Industry Insights Report (CIIR), the average credit card balance per consumer in June of 2023 was $5,947…the highest in the past ten-years! Would a client who is monitoring their checking and savings balances possibly spend less if they knew they were spending more than they are making? Possibly. Would a client who was following progress of his/her goals in a measurable manner be in a better mindset in sticking to a task, budget, or plan? You bet!

Other reasons it is important to visualize your assets and debts by type, is so that you can identify strengths and weaknesses in your overall allocation. For example: You might have an auto loan that currently enjoys a 1.9% interest rate (very low) that you’d like to pay off. At the same time, you know that you have enough cash to do so, and you hate monthly payments.

But you are also considering the fact that your current savings account is paying you 3%, an amount that is higher than the monthly cost of the car loan, so you know that it benefits you to NOT pay off that car loan early (at least in this scenario). Looking at the before and after effects of your “net worth” statement, you are able to see how paying off the car not only does NOT add any value to your estate, but actually lowers your monthly cash flow-ever so slightly. This might only be able to be realized when you can visually see the numbers on a screen.

Feelings, gut instinct, and hunches have no place in the financial world. Spock would be the perfect investor as he has no feelings of euphoria, dismay, or FOMO. Realizing things for what they are and how they relate to your needs and wants is paramount to successfully sticking to a financial plan, with or without an advisor. Utilizing modern-day tools to work together in a highly visualized environment might just be what you are missing. Feel free to schedule a date for a demo; it might be the key to a brighter financial future!