The Dual Career Professionals

The Setting

Michael and Allison both attended TCU where they became college sweethearts. They’ve worked hard to advance their careers in their mid and late 20’s. They both love their careers but recognize there are certain challenges that come with their respective jobs and they realize they need outside help.

They have also noticed that they’ve been subject to lifestyle creep as their incomes have grown over the years. They want to reign this in because they realize if they don’t it will just be a lost opportunity to pursue the things that matter most.

The Conflict

Michael & Allison love that their careers gives them more flexibility and options to pursue what’s important. However, they’re still left with a lot of questions.

They would like to know:

• How do we prepare for starting a family in the next couple of years?

• How do we better manage our variable income (commissions and bonuses)?

• How do we best utilize our income in order to prevent lifestyle creep?

• How do we go about getting life insurance and an estate plan in place? What exactly do we need?

• We’d like to invest in experiences on an annual basis, how do we go about doing this?

• What else should we be doing?

They know they need a plan and someone to guide them.

The Approach

First, I listened. Then I asked Michael and Allison the questions that many planners fail to consider. I asked them about their history with money (individually and together), their best and worst financial decisions, their dreams and aspirations, and ultimately what was most important to them.

Many of the questions and concerns that Michael and Allison had are common with the families I serve.

Once I truly understood their goals and motivations, we were able to create a unique plan together, with the proper action steps, that strengthened the fibers between their finances and what was most important to them.

The Resolution

After several meaningful conversations and analyzing the information, I was able to help Michael & Allison:

• Create a savings plan, according to projected expenses, in order for them to confidently start a family in the next couple of years.

• To create a structured way to live off of one of their incomes to start preparing for a stay at home parent in the foreseeable future. I also modeled the impact of reduced income for one earner to give them a sense of the potential risk and how to plan for it.

• Set up a reverse budget which prioritized and automated saving for their short, mid, and long-term goals and then living off the rest of their income. We also implemented system that determined where variable income (commission and bonus) should go.

• Get their own individual life insurance policies after doing a life insurance needs analysis. Furthermore, we decided it was in their best interest to take out disability insurance policies to protect their income.

• Work with an estate planning attorney to get their basic estate planning documents in place (will, power of attorneys, healthcare directive, etc.). We also updated all their beneficiary designations on their accounts and assets.

• Establish a fund, that they continually save into, that would allow them to enjoy travel and experiences each year even as they grow their family.

• I also reviewed their investments and investment accounts to ensure they were low-cost, tax efficient, and invested in a way that gave them confidence for their retirement and other goals.

We regularly check-in and track their plan and portfolio to ensure they’re maintaining a proper trajectory towards achieving their financial goals. They were ecstatic to receive actually financial planning from someone that understood what they wanted and didn’t just want to sell them a product.

Now that they have a plan in place, Michael & Allison are able to fully focus on their marriage, starting a family, careers, other meaningful relationships, and the other important things in their lives. The way it should be.

Note: The above case study is hypothetical and does not involve an actual Prospurpose Wealth 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 Prospurpose Wealth is engaged to provide financial planning or investment advisory services.