Family Business: How do you measure financial success?

Kim Kantor

Photo by Lexey Swall, Naples Daily News

Kim Kantor

Financial success is about having choices; true life choices you can make without financial strain or devastation.

These choices are those that give you the freedom to work hard at something you enjoy and allow you to give back to your community, your friends, and your family. Measuring financial success is difficult in that it is personal and circumstantial.

Where you live, your responsibilities, your assets and certainty of your income, all play a vital role.

Quantifying your financial success by putting a dollar figure to it can, however, help you to measure your performance over time and set standards.

Ask questions and document your answers

What capital accumulation will it take to produce the cash flow you desire?

What is your foundation now and what are you starting with?

Is there any guarantee of income, perhaps a pension or Social Security that will supplement your lifestyle needs and a comfortable income stream?

How will taxes impact your cash flow and accumulation?

Can you predict within 5 to 10 percent your expenses for the upcoming year?What is the current economic climate; and, given such, project a reasonable assumption of investment growth. What is your time horizon?

Is your saving rate high enough to achieve your objective? If not, can you cut expenses or add income if necessary?

Are you saving at least 15 percent of your income, more if closer to retirement?

Don't forget to properly assess the performance of your investments

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