The Financial Prosperity Index^® is a tool that objectively measures the financial condition of a household and the effectiveness of one’s financial plan, whether you are formally following one or not. The purpose of a financial plan is to assist the members of the household to experience the optimum financial condition so that their goals and purposes can be achieved.

In order to assess one’s current financial condition, it must be compared to an ideal financial condition for the household. This is a glaring omission that gives us a false sense of how well we are really doing - we compare ourselves with our neighbors instead of what would be optimum.

Financial planning as a subject is broken down into 9 specific facets and each of these facets must be in a certain condition of completeness and correctness for the whole plan to be considered optimum. An optimum financial condition would be as follows:

1. You are implementing a written comprehensive financial plan. A written plan would contain programs to get each of the remaining 8 facets into excellent condition so that the prosperity of the household can be achieved, monitored and measured.

2. Policies and procedures regarding finances would be known and followed in the household. This includes knowing the basics of personal finance and being competent to handle the financial affairs of the household with certainty and success. I have created a course to teach people these simple basics.

3. You are experiencing affluence in your business. Your business is expanding and very profitable. You are enjoying your work and are enjoying success.

4. You have an abundance of income. You are enjoying a level of income that not only pays for your lifestyle, but enables you to set aside sufficient funds for retirement and other purposes. You have also made provisions to generate tax-advantaged income in retirement that pays for your lifestyle comfortably with the option to work or not.

5. Your household and business are debt free. Your house is paid off and you do not carry any other debt. You are comfortably paying for most of life’s expenses from cash and not from credit. If you do borrow, it is for profitable business purposes only. Your credit is also in excellent shape so if you do need to borrow, you can do so at the best rates.

6. Your estate plan would be complete. This means that you have up-to-date wills and other documents to ensure that your health and legal matters will be taken care of under your directions and not the State. This also plans to keep estate and gift taxes to a minimum.

7. Your taxes would be as low as possible. Income taxes will always be levied against income, so a plan needs to be implemented to not only save taxes today, but for the rest of your life. Neglecting to plan for income taxes in retirement can destroy your retirement lifestyle when the time comes.

8. Virtually all of your assets have protection from loss. This means that you own assets in a way that minimizes the risk of loss from creditors, market losses, tax losses, inflation and other forms of asset destruction.

9. Your investments are stable and productive. The best investments are those that get the best results for the purpose for which they were invested. In other words, the best investment isn’t the one with the highest return. If the rest of your financial plan is being done, you do not have to take unnecessary risks in other investments to become affluent - you will already be there.

This is the condition I would think most people want to experience. There are many different paths to get there and many, many more that will not even get you close - you are taking a path right now, but have you asked whether that path will get you to this optimum condition? Maybe not.

Now, you can objectively measure your progress on the path. The Financial Prosperity Index® is a questionnaire of 100 questions for a business owner and 90 questions for a professional associate, employee or retired person. The questions are designed to validate areas that are doing well and suggest improvements for areas that are not doing well in your financial life. The answers are analyzed, scored and plotted on a graph so you can see the overall financial condition of your household at a glance. The index score ranges from 0-850, with a score over 700 approaching the acceptable range.

This questionnaire will take about 15-20 minutes to complete and your answers will be held in confidence. At the end of the questionnaire, you will be asked to provide 3 possible times to have an appointment for a web meeting so we can review the results with you.