What You Should Pay Attention To
- Jonathan Harner, CFP®
- May 15
- 3 min read
After nearly a decade as a financial advisor, I've observed our industry tells investors to primarily focus on one thing: market performance. This is like driving around staring at your speedometer. It's important to know your speed, but if you are not looking at the road you have no context for your speed. Are you going to fast? Too slow? You cannot know unless you have the right context from actually watching the road. Not only that, but if you aren't watching where you are going you will crash!
Unfortunately, this is how many investors I have talked to interact with their money. They stare at their portfolio returns without any context for whether the returns are good or bad. Their returns tell them nothing about whether they are on track to meet their goals. So, they end up crashing by making a poor investment decision because they aren't watching the road!
So, if market returns are the main thing to focus on, what should you keep your eyes on?
The Financial Noise – What You’re Usually Told to Worry About
Just to be clear market returns aren't the only way investors are distracted from watching the road. Financial media and many advisors can act like a carnival sideshow—lots of flash and bang, but little substance. They typically focus your attention on:
Daily market movements
Short-term performance metrics
Overly complex investment products
Fee obsession without context
Abstract benchmarks and predictions
These distractions create anxiety and confusion. Rarely do they enhance your financial security or leave you with a sense that you even know what's going on.
The Reality Check – What Actually Impacts Your Financial Future
Rather than being distracted by flashy headlines and sexy investment products, stay focused on a few straightforward yet crucial questions about your financial health:
1. Are you taking the right amount of risk?
Equity Rate: Ensure your investments align with your life stage and risk tolerance.
Insurance Rate: Make sure your insurance coverage adequately protects your wealth without overpaying.
2. Are you using your income wisely?
Savings Rate: Consistent savings is your strongest defense against uncertainty.
Burn Rate: Keep your lifestyle aligned with your values and long-term goals.
Debt Rate: Manage debt proactively, keeping leverage sustainable.
Tax Rate: Prioritize tax efficiency—it's your largest lifetime expense, and careful management can significantly grow your wealth.
3. Do you have the right mix of assets?
Liquid Term: Have enough liquidity to cover emergencies and opportunities.
Qualified Term: Optimize retirement accounts to ensure tax-efficient growth.
Real Estate Term: Consider the role real estate plays in diversifying and stabilizing your portfolio.
Business Term: Align business assets strategically to support both your personal and professional goals.
4. How much wealth do you need to make work optional?
Total Term: Clearly define your financial independence number, ensuring your savings and investments support your desired lifestyle indefinitely.
We use our Financial Scorecard to define and answer the questions above. By leveraging our Financial Scorecard, you can get clear actionable direction. Not just a generic checklist.
It can help you answer the questions that actually define financial security, not just the distractions and noise pulling your attention away from the road.
Regardless, whether your use our Financial Scorecard or another tool, keep your eyes on the road. This is the only way you will have the context necessary to understand what your speedometer is telling you.
Financial planning becomes infinitely clearer—and more effective—when you focus on what truly matters. Use a tool like our Financial Scorecard and the four questions above as your compass.
Ready to replace confusion with clarity by focusing on what really matters with your money? Schedule your complimentary call today.
