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Case Study

Mike & Elaine

The Situation

Mike (36) and Elaine (34) are working parents with two children, Samantha (6) and James (4).

Mike and Elaine have managed their finances on their own to this point (and have done a great job). But they no longer feel able to dedicate the time and energy they would like to their personal finances.

Mike and Elaine want to work alongside a financial advisor to ensure they are thinking about and doing the "right" things.

Especially important for Mike and Elaine are:

  • Developing a plan for their cash flow: How much to set aside for emergencies? Which accounts to invest in? How to plan for Elaine's stock compensation?
  • Choosing the right investments for their different goals: Retirement, college savings, and a potential vacation home in 5-10 years
  • Making smart tax decisions and maximizing tax-advantaged accounts for their goals: 401(k)s, IRAs, HSAs, 529s, etc.

Ultimately, Mike and Elaine want confidence that they are on track for their goals and making smart financial decisions.

The Process

We begin by establishing where Mike and Elaine are today by gathering documents, linking accounts to the financial planning and budgeting software, and establishing cash flow expectations.

With this information, we lay the foundation for Mike and Elaine's financial plan.

Family Balance Sheet

Anticipated Cash Flow

With the foundation firmly in place, we work together over several months to create Mike and Elaine's financial plan.

The topics we cover include:

Given the breadth of these topics, we meet several times over the first six months of the relationship to focus on each major component of the financial plan.

Particular attention is given to Mike and Elaine's primary pain points, while also ensuring the rest of their financial picture is analyzed and in alignment with their values and goals.

Onboarding Meetings

The Results

Mike & Elaine's financial snapshot from RightCapital planning software

By the end of the onboarding process, Mike and Elaine feel confident in their family's financial outlook and are relieved to have a plan for their most pressing concerns. Mike and Elaine's achievements during the onboarding process include:

  • Developing a bank account structure, complete with a separate emergency fund and short-term savings earning a competitive interest rate
  • Creating a savings hierarchy for 401(k)s, IRAs, 529s, HSAs, taxable accounts, and other savings
  • Identifying how much to save for each of their top priorities (retirement, education, vacation home)
  • Understanding their tax picture and which tax-advantaged accounts are best suited to their goals
  • Specifying a plan for irregular income (like Elaine's stock compensation)
  • Reviewing all investment accounts and consolidating/simplifying where appropriate
  • Creating an overarching investment policy statement, and delegating the management of accounts to Kardinal Financial

Not only have Mike and Elaine taken these steps in their financial plan. They also have a structure to regularly review and update their financial lives, and a financial partner to rely upon as life inevitably changes.

Kardinal Financial's ongoing relationship framework ensures Mike and Elaine's financial plan evolves with their lives.

Note: The above case study is hypothetical and does not involve an actual Kardinal Financial client. No portion of the content should be construed by a client or prospective client as a guarantee that he/she will experience the same or certain level of results or satisfaction if Kardinal Financial is engaged to provide investment advisory services.

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