Turn Financial Chaos Into Clarity With a Year-in-Review

Speaker 1 – 00:00
Money can really control a lot of your thought process every day. The more wealth you have and the more time you
have, the easier it is to get sloppy.
Speaker 2 – 00:06
Higher net worth families, they have a lot of stuff going on in their lives and in their financial lives. We found this as
a helpful exercise to really just look at what did I actually do last year financially?
Speaker 1 – 00:17
What should we do more of, what should we do less of and then what should we stop doing altogether? What are
the 20% of purchases that you made, people you spent time with that gave you 80% of the best results or best of
emotions? Who did you spend time with and rank those? Which people did you experience the greatest joy? What’s
the best thing you did last year and the stupidest thing you did.
Speaker 2 – 00:37
Last year I bought a lot of random things on Amazon. I don’t even know if I still have them. Don’t track everything,
you’ll get too obsessed with it. But have a few indicators that you want to prioritize and make the goal.
Speaker 1 – 00:48
It’s been one of the most important things I do for my own financial plan. I’d say the biggest goal is just which can
lead to lower stress and more emotional intelligence. Foreign believers that you become what you think about. So
what you know, what you think about really expands. And so in finances, a lot of people think about what stresses
them out. Money can really control a lot of your thought process every day. And so as financial advisors, we think
it’s very important to make sure that your thought goes into data that’s going to help frame good decision making
in the future and lower stress and ultimately help you reach your goals. So today we’re going to talk about
completing a past year in review. Jameson, let’s start out. What’s the importance of this in relationship to
calibrating a financial plan?
Speaker 2 – 01:41
Meeting Title: EP 05 Performing a Financial past
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Meeting created at: 23rd Mar, 2026 – 12:41 PM
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Yeah, I think when we’re specifically looking at higher net worth families, they have a lot of stuff going on in their
lives and in their financial lives. And balance sheets can get rather chaotic or complex I guess is a better word for
it. And a lot of times what I’ve seen is there’s just, they know that they’re not spending too much money obviously
because they’ve accumulated wealth. They know that the basic things are okay, but they don’t know. They kind of
lose a grip on hey, where’s my money actually going? And so we found this as a helpful exercise to really just look
at what did I actually do last year financially, where did I spend my money? Did my Net worth increase or decrease?
Did. And I would say the biggest thing is did finances create more or less stress into my life?
Speaker 2 – 02:33
And I like to look at it as like, where’s the plan leaking? So like, where is some money flowing out that it doesn’t
need to be? Where, where are there areas where, you know, we’ve spent on that didn’t make our lives easier or less
stressful? And are they, are these things aligning? Are these spending goals aligning with our knuckles? Did the
spending align with our values or family?
Speaker 1 – 02:56
The three things that we’re trying to achieve with the past year interview is answering the questions of, you know,
what should we do more of this next year? You know, the 2026, what should we do less of? And then what should
we stop doing altogether? So from a financial perspective, I think, you know, step one is just looking at where every
dollar went. So I recently did this myself, so we looked, you know, now with the use of, you can do this in Excel, you
could do this if you have an enterprise AI system that can like, you know, your information is not going to the cloud.
You could, you could use AI to help boost this. But basically, you know, looking at how what dollars actually came
in, what dollars came in the door, and typically those go to three different categories.
Speaker 1 – 03:47
Either, you know, they went to taxes, you saved it, or you spent it. So the first step for me was looking at what was
the percentage between those three categories. And I think for a high net worth person, generally speaking, if
you’re doing good tax planning, you can get your tax bracket effectively between like federal, state, local, probably
not below 30, but somewhere between like 33 to 40% if you’re doing lots of tax deductible stuff. So all in about a
third and then a third ideally should be saved and a third spent. And now that’s really aggressive. But if you’re
higher income or high net worth, ideally it, sometimes saving isn’t just about creating financial independence.
Sometimes it’s about controlling your money temperature.
Speaker 1 – 04:35
Because if you don’t spend, save it going to get spent and then the assumptions that you need to keep up that
lifestyle just get insane. And so there’s levers that you can pull either way. So doing that past year in review just
gets you an honest look at, you know, what was the percentages. And so typically we see that people think they
saved a lot more than they did and they think they spent a lot less than they did.
Speaker 2 – 04:55
Meeting Title: EP 05 Performing a Financial past
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Let’s, let’s talk about the money temperature for a minute with high net worth families because I found this to be
really true. It was interesting last week I, with a group of friends having dinner and the one guy had, he worked in
commercial real estate, started his own company and had like, just started making like seven figures of income.
And he was telling me like, you know, he’s like, once you start spending and get that lifestyle, you get really used to
it and then you have to keep repeating it. And I started thinking about that and I was like, yeah, that’s kind of a lot of
people we work with.
Speaker 2 – 05:28
If you don’t look at this and you can start to make, you know, seven figures of income, multiple seven figures of
income and then that temperature goes up and then it’s a lot of just pressure and stress of like I have to keep
repeating this every single year. And so I think what you just said is a simple way to calibrate that is let’s make sure
that of the dollars that come in, what is that baseline living expense. And if, yeah, you could afford to get it higher.
But then it’s just unnecessary stress that you may not want to carry as you’re owning a business or other areas in
your life, you have to keep, you know, replicating that income.
Speaker 1 – 06:04
But yeah, absolutely. So just guardrail. So Pastor review. We want to see some pretty big caliber and these are not
meant to judge yourself or beat yourself up on how much you spend. But generally you want to get into that
framework where let’s say you’re making a million dollars, you want to pay no more than 400,000 of that in taxes. If
you’re paying more, you know, maybe you’re in a high state tax, you don’t have the right company structure, maybe
you’re W2, but you should be able to get that to under 40% and no more than 400,000. I would say if you do not
want to spend more than 400,000, ideally you’re just spending 3, 300 or 350 of that. So we’ll just say max of like
30amonth. And ideally you’re saving though, let’s say 400, that leaves 600.
Speaker 1 – 06:46
So then you’re spending 300, you’re saving 300. And again the saving 300 isn’t to over accumulate, it’s to control.
Because to replicate a $25,000 a month lifestyle, if you’re 35, that’s going to be close to like $60,000 a month,
inflation adjusted when you’re 65. And so you’re Going to need a very big nest egg to continue that up. And if you
don’t save that money naturally your lifestyle that money temperature is going to go up and up so that those are
the minimum guardrails.
Speaker 1 – 07:12
And I would say if someone’s on the flip side, if someone’s you know, let’s say at 30%, 35% tax bracket they’ve got
650 left and then they’re saving 550 only spending a hundred they’re way over accumulating, you know probably
and they’re never, they’re accumulate so much that they’re never going to be able to spend it all and they’re
probably living too much scarcity mindset, fear based mindset and that’s going to bite them in the butt either way.
So this past year interview just to get a calibration system within guardrails, how good do we do between securing
the future and then also minimizing life regret today?
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Speaker 2 – 07:49
Because that your example there. Yeah. 30amonth. Let’s say you’re in your 30s and you’re spending 30amonth. You
basically need $10 million to replicate that to take that out after taxes.
Speaker 1 – 08:01
And the only way in today’s dollars.
Speaker 2 – 08:02
Yeah.
Speaker 1 – 08:03
So the time you retire it’s probably you know 20.
Speaker 2 – 08:06
Yeah. You may have a liquidation event at some point but you don’t really want to rely on that. So the only solution
is you know those numbers you just broke down is saving a lot of your income.
Speaker 1 – 08:17
Yeah. So this is data because like financial decisions a lot of times and I what I’ve structured, we try to structure
our clients plans is to make savings there as a priority because we don’t want to beat up which why do you spend
this while you spend this Just control that money temperature. Just like show up to the gym and make but like
getting to the gym is the hard part. So reverse budgeting system can really replicate this. But once you go through
this exercise so that’s step one and step one A we then okay, did we hit all of our savings goals? Do we max out
401ks Roth IRAs? Did we do all the 529s?
Speaker 1 – 08:57
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Do we do all the low hanging for the asset protected tax position stuff and then did we put the excess in a
brokerage account and we’re honest ourselves? Did we blow that brokerage account up because of a bathroom
renovation or whatnot? Did we keep that money saved? So it’s not just what went to savings what many kept
Savings making sure those percentages are minimum of 20 high end 40. Somewhere in that range, you know, a
healthy number would be like 30% of the total cash flow on top of that. So from a savings perspective we’d be
setting the goal and calling shotgun in the next year. Here’s what okay, I know I’m going to make a million, I’m going
to save a minimum of 30%. 300,000. Here’s the accounts. I do this in Excel spreadsheet.
Speaker 1 – 09:36
Here’s the accounts, here’s how much I’m going to put. Here’s what my cash flow looks like, here’s the cadence.
These are on autopilot, these are manual. Here’s when I’m going to them depending on how cash flow or income
comes in. And then step 1B would be looking at your spending and then categorizing this is where AI can really
help. Where did the money go? You know, I thought I was spending 10amonth. I spent 25 month just making those
numbers up for you know, sake of example. But okay, where did this go? What categories did I go? And then you
know, part of the importance of this is, you know, probably a lot of those expenses were some stuff you bought.
Which one of those you still feel good about. Which one of those no brainer.
Speaker 1 – 10:17
Maybe you buy a new couch, maybe it’s a new car lease, maybe it was a new. You put a bathroom renovation in.
Which do we, which will we repeat again? Which is a no brainer. And what, which one of these were stupid? That
should be eliminated. And that can help you plan out the next year. Just from a philosophical standpoint of are we
going to do something goes wrong, Are we going to upgrade things 10 times more than we need to? Are we going
to prioritize vacations with certain people? You know, look at your peak experience.
Speaker 1 – 10:46
Basically the point of this is what were the 20% of purchases that you made, people you spent time with that gave
you 80% of the best results or best of emotions with your friends and then get those so get the financial shotguns
called here’s what I’m going to save, here’s how I’m going to control my spending. And then also from a gation
standpoint, it’s not just like putting a budget but like plan who you want to go on vacation with. Plan the dates, get
it planned, plan the experiences out. Make sure those peak experiences aren’t just 20% of your time. Try to
replicate that and make that all of your time is the goal.
Speaker 2 – 11:21
And I think if you don’t traveling specifically, but all of this, if you don’t plan it, if you’re not proactive, it becomes
reactive. You, you know, you agree to trips with people that you are not. Like, it’s not the most, not who you want to
be spending your time with. It’s. You’re spending more than you want because you don’t think about it. But I think I,
I think having a cash flow system is and like we like reverse budgeting or some structure of that is like just the
easiest way to fix this. And I think that gets really overlooked with high net worth people. Like I’ve had specifically
advisors actually have told me like, oh yeah, why would you need to go through a budget with someone that is
worth $10 million?
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Speaker 2 – 12:07
It’s like, well that person probably needs to go through a budget more than someone that makes $100,000 a year
because they don’t even know where their money’s going.
Speaker 1 – 12:15
And the budget is, the end goal is not to be, it’s to create an honest system that’s going to work.
Speaker 2 – 12:22
Having some sort of structured discipline system. And the other thing too, what you said, look at what you spent
on that, you’re if you bought it a year ago and like a year later if you still. Like I did when I just did this for myself, I
looked at like, you know, I was like, oh, I bought a lot of random things on Amazon that I don’t even know if I still
have them.
Speaker 1 – 12:42
What’s the best thing you did last year and the stupidest thing you did last year from a financial purchase?
Speaker 2 – 12:46
The best thing I didn’t, I didn’t do anything dumb. I didn’t do any, didn’t make any big mistakes. It was just like it
wasn’t any, like it was just eye opening to me of like again I had these guardrails of where how much I knew I, you
know, was allowing myself to spend. But then just looking at like oh wow, you spent this in this category. This
much in this category. Like when you actually dial it down.
Speaker 2 – 13:09
But I would just say the biggest thing, not stupid but was just like you have random like shopping, Amazon
shopping stuff that like not that it was not that it broke the bank by any means but you just look back and you’re
just like, you know, I didn’t need to spend X amount of money on something that is a material item that I really don’t
care about. You know, six months later. How about You.
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Speaker 1 – 13:30
Yeah, I would say for me it would be the little stuff that adds up on those Amazon box. And then you’re like, you see
something, it’s little, so you justify like, oh, I can afford, I don’t need to think about that. And then you spend more
time organizing, unpacking, and then you don’t use half the stuff. I would say what I would replicate is I made a
couple good, like very good purchases and just focusing on the quality and slowing down. And maybe you know,
this year I thought, because I was like, I put email myself, I need this now. It’s just like batching time where I do all
my purchases because if I think if I sat on it for a day or two, then I, if I wouldn’t buy half the stuff I would buy. So
that would be the stupidest.
Speaker 1 – 14:08
And I would say the best thing obviously like travel. Yeah, yeah, travel experiences, you know, things with my
daughter, etc. So yeah, doubling down. The interesting thing is like now I have some specific blocks with specific
people of like these could range from like a monthly dinner with one of my best friends. We’re both busy, he’s got a
busy family. Just making sure that’s a cadence that we do. The last year we didn’t do it every month, but it was like
one of the most important meetings that we had. And then also like traveling, getting the things actually
scheduled, getting the right people invited, you know, et cetera can be obviously huge and you get to look forward
to it the whole year and then obviously after you kind of get feel relaxed.
Speaker 1 – 14:53
So it’s like even the process before and after may even better than the experience itself if you do it the right way
with the right people or sometimes like last second you get invited and you like say yes out of like reactive mode
like you said, versus proactive mode. So okay, well that’s 1A and 1B. So pass your own review. From a financial
perspective, we’d also recommend do this from like look at your calendar, you know, who did you spend time with
and rank those, you know, which people did you experience the greatest joy? Which, which did you not try to
eliminate? You know, the, you know, the meetings that you didn’t have joy and then try to replicate as much as
possible the ones you did.
Speaker 1 – 15:33
And then I’d say from a net worth perspective something and actually keep this in Excel spreadsheet is just so I
don’t check my accounts. Every day is once a month at the end of the, you know, the first day of the next month, I
close out the last month and so I update net worth on a monthly basis and have every category. I think this is good
just for cyber security as well because then you can check last month’s balance and see if anything looks
suspicious. This is a process. I think people spend so much time on social media, so much time reviewing their
accounts. This is just an intentional. So once a month I log in everywhere to see everything, write it down and I
compare it month to see that I grow.
Speaker 1 – 16:09
If I didn’t, what was the reason was a little bit market volatility and then I close it out year by year as well.
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Speaker 2 – 16:14
Don’t track everything because it’ll just get, you’ll get too obsessed with it. But have a few indicators that you want
to prioritize and make the goal of like these are the, you know, maybe two to three personal KPIs. Like this is what
I’m going to track. Whether it’s net worth. General we found is generally a good one. What else would you say
would be good indicators to track net worth?
Speaker 1 – 16:36
I think the percentages of CA of taxes versus savings a net savings would.
Speaker 2 – 16:40
Be a good one.
Speaker 1 – 16:41
Sure.
Speaker 2 – 16:41
It is too. Those are probably the two most important.
Speaker 1 – 16:43
Yeah, they say like our, some of our thoughts are the same thoughts as yesterday, the same day as a month ago
and say so it creates, you have to have a lot of intention to recreate, you know, your thoughts which would create
ultimately the daily experience in your life. So finances are the same thing. If you don’t do this past year and review
it. It’s not about judging, you’re beating yourself. That’s, it’s learning from your past experience, replicating the
good, trying to eliminate the bad. It’s really simple as that. But the data you can learn from yourself and getting
conviction of what not to do, what to eliminate and having a process for is super important.
Speaker 1 – 17:14
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So some of the other lessons I would learn is, you know, I spent, I did a couple private investments and you kept
those very low percent of my net worth. And just looking back, you know, one did well. The others are kind of still
you know, very stagnant. So just general philosophy. You know, I think my greatest input, my time is, you know,
traditional investing. That’s what you know, I have my proficient in.
Speaker 1 – 17:40
We help clients with is just sticking to that, not getting distracted and just stay with that because in a busy, you
know, day to day, month to month and you kind of group think and like your friends are doing it think you know for
me specifically steering clear of any kind of private so that way it protects my time and my attention and just with
clarity is going to be super important having you know a batched for. For a variable for swiping purchases, having a
batch time and how you know if it’s above a certain amount thinking about it, you know, a couple days and then
really just giving myself permission to spend by making I’m focused on all my intention on living a good life but
hitting the savings goals.
Speaker 1 – 18:21
If you have a reliable cash flow of making you do that, then you don’t have to worry about the rest if those
percentages are correctly aligned. So make the one decision that’s going to eliminate thousands of decisions.
Ideally I’ve done this past year in review really for the last five years. I’ve been able to build on it so it comes
naturally this time. But it’s been one of the most important things I do for my own financial plan for sure. So I, I’d
say the biggest goal is just better money decisions which can lead to lower stress and more emotional
intelligence. You can be strategic moving forward of how you want to spend your time and how your assets are
supporting that. So Jameson, any closing thoughts?
Speaker 2 – 19:00
No, this is a, it’s a great exercise. It helped me and then yeah, if you haven’t done why you’re doing this, if you
haven’t already done so is go through an exercise to figure out what is most important to you and you know, write
down your personal values and then try to align that with did I spend in line with this? And then this past year and
then next year. How can I get this more in line? So like an example would be if health is a value and you’re focusing
on improving your health but you know, didn’t allocate any of your income to. To the health category. You know,
that could be things like a trainer, nutrition, whatever that is. But you. I don’t know what would be something that
would deteriorate your health. You spent on something else. You were.
Speaker 2 – 19:51
Maybe you’re traveling, maybe you’re for your work, you were traveling. You know, you were in a hotel 250 days of
the year and you. That was your excuse to not prioritize health.
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Speaker 1 – 20:00
So whatever it is, yeah, you’re eating sloppy. You’re not, you know the general doordash.
Speaker 2 – 20:04
Would be a good one.
Speaker 1 – 20:05
Yeah, yeah. And I think the life wealth becomes a paradox and time becomes a paradox because the more wealth
you have. And the more time you have, the easier it is to, you know, get sloppy. I can afford to eat out, and I can
afford to that can lead to other values getting, you know, not respected to the level they should. So that’s a great
point. But. Well, thanks for joining, everybody. And if you want to do a past year on review, this is something we do
for all of our clients. So, you know, give us your statements, your credit cards. We have a safe, secure system that
we can analyze all that, categorize it, and we’re in a judgment free zone.
Speaker 1 – 20:40
But make sure your financial plan is actually has the right assumptions to it and make sure you’re making the right
decisions that you live life regret free today, stress free today, and you’re securing the future of the process. So
that’s the goal.