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I’m a Financial Planner: Here’s Why You Can’t Judge Wealth by Appearance

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I’m a Financial Planner: Here’s Why You Can’t Judge Wealth by Appearance

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Wealth isn’t about what you can see, but what you can’t. While it’s easy to assume that someone driving a luxury car or wearing designer clothes is financially successful, according to experts, wealth often lies in what isn’t visible — savings, investments and financial security.

GOBankingRates spoke with Dennis Shirshikov, head of growth at GoSummer and professor of finance at City University of New York, as well as Mafe Aclado, finance expert and general manager of Coupon Snake, to discuss why you can’t judge wealth by appearance.

See Now: 10 Genius Things Warren Buffett Says To Do With Your Money

Read Next: 6 Subtly Genius Moves All Wealthy People Make With Their Money

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High-Spending Habits Can Mask Financial Instability

“I’ve seen clients who lived very modestly but had substantial retirement accounts, real estate investments and portfolios,” said Shirshikov.

On the flip side, he said there are individuals who appear wealthy but are actually over-leveraged.

“These are the clients who may have an expensive lifestyle but rely heavily on credit and are often just one financial setback away from a crisis.”

Many of the Wealthiest People Practice ‘Stealth Wealth’

One of the more interesting aspects of working with affluent clients, according to Shirshikov, is discovering how many of them actively downplay their wealth.

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“They drive regular cars, live in modest homes and avoid flashy purchases,” he said.

This concept, known as “stealth wealth,” is about avoiding the trappings of luxury and focusing instead on long-term financial goals.

“A prime example is a client who made millions through real estate investments but maintained a frugal lifestyle to ensure they could continue building generational wealth. For them, financial success was about freedom and security, not outward appearances.”

Learn More: I’m a Self-Made Millionaire: 6 Steps I Took To Become Rich on an Average Salary

Financial Success Often Comes From Discipline, Not Appearance

Experts emphasize that real wealth is built through financial discipline — consistently saving, investing and living within your means.

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“I’ve noticed that some of the wealthiest individuals I’ve worked with never focused on appearing rich; they were focused on the long game,” Shirshikov said. “One client, who retired early with significant assets, told me they always resisted the pressure to ‘keep up with the Joneses.’”

His advice to younger generations? “Focus on making your money work for you, not on looking like you have more than you do.”

Aclado has observed the same. “The No. 1 reason why you can’t judge wealth by appearance is the fact that when it comes to how to spend their money, people have different priorities. While some may be more interested in keeping up with the Joneses, staying in touch with the latest fashion trend and owning the latest cars, others may have more ambitious desires.”

And for these groups of individuals with intense financial ambitions, she said lifestyle inflation is one of the things they consciously guard against.

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“Not because they cannot afford more comfort or luxuries, but because they would rather plant their money in investments that would yield more profits in the future.”

The Wealthy Play the Long Game

According to Aclado, these individuals are also more likely to play the long game; that is, they choose to become strategically patient when it comes to spending and managing their money.

“And they focus on long-term goals like building generational wealth and prioritizing financial sustainability as opposed to seeking instant gratification,” Aclado said.

Living Frugally Isn’t an Attractive Option for Many

“There is also the fact that some people — especially when in their 20s — honestly believe that they still have enough time, and can therefore afford to be financially indulgent,” Aclado said.

She explained that with social media influence, fast fashion and today’s intense spending culture, people’s outward appearance can’t really be trusted as a sign that they are financially successful.

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“Because today, living frugally isn’t exactly an attractive option, even when its benefits are clearly visible.”

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This article originally appeared on GOBankingRates.com: I’m a Financial Planner: Here’s Why You Can’t Judge Wealth by Appearance

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Boards of Directors of Portman Ridge Finance Corporation and Logan Ridge Finance Corporation Form Special Committees to Continue Evaluating Potential Business Combination

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Boards of Directors of Portman Ridge Finance Corporation and Logan Ridge Finance Corporation Form Special Committees to Continue Evaluating Potential Business Combination
Portman Ridge Finance Corporation

NEW YORK, Dec. 12, 2024 (GLOBE NEWSWIRE) — Portman Ridge Finance Corporation (Nasdaq: PTMN) (“Portman Ridge”) and Logan Ridge Finance Corporation (Nasdaq: LRFC) (“Logan Ridge”) announced today that their boards of directors have established special committees of independent directors to more fully evaluate the potential business combination of the two companies that was previously disclosed in their respective Form 10-Q filings with the Securities and Exchange Commission (the “SEC”), which may result in the use of an exchange ratio other than NAV-for-NAV (including but not limited to relative market price or a fixed exchange ratio) in connection therewith.

The special committee of Portman Ridge’s board of directors has retained Keefe, Bruyette & Woods, Inc. as financial advisor and Stradley Ronon Stevens & Young, LLP as legal counsel. The special committee of Logan Ridge’s board of directors has retained Houlihan Lokey, Inc. as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP as legal counsel.

There can be no assurance that Portman Ridge and Logan Ridge will pursue the potential business combination, or that the potential business combination will be approved or consummated. Portman Ridge and Logan Ridge do not intend to disclose further developments regarding this matter unless and until further disclosure is determined to be appropriate or necessary.

About Portman Ridge Finance Corporation

Portman Ridge Finance Corporation (Nasdaq: PTMN) is a publicly traded, externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940. Portman Ridge’s middle market investment business originates, structures, finances and manages a portfolio of term loans, mezzanine investments and selected equity securities in middle market companies. Portman Ridge’s investment activities are managed by its investment adviser, Sierra Crest Investment Management LLC, an affiliate of BC Partners Advisors, L.P.

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Portman Ridge’s filings with the SEC, earnings releases, press releases and other financial, operational and governance information are available on Portman Ridge’s website at https://www.portmanridge.com.

About Logan Ridge Finance Corporation

Logan Ridge Finance Corporation (Nasdaq: LRFC) is a publicly traded, externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940. Logan Ridge invests primarily in first lien loans and, to a lesser extent, second lien loans and equity securities issued by lower middle market companies.  Logan Ridge Finance Corporation is externally managed by Mount Logan Management, LLC, a wholly owned subsidiary of Mount Logan Capital Inc.

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Survey: 44% of Americans believe their finances will improve in 2025, an increase from previous years

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Survey: 44% of Americans believe their finances will improve in 2025, an increase from previous years

More Americans are expressing optimism about their finances as pandemic-era price hikes and the “vibecession” increasingly fade away.

Bankrate’s latest Financial Outlook Survey finds that 44 percent of Americans think their finances will improve in 2024. This compares with 37 percent who said in a 2023 survey that they expected their finances to improve in 2024. Previously, 34 percent said the same in 2022 (regarding their finances in 2023) and 21 percent said the same in 2021 (regarding their finances in 2022).

There’s at least one clear reason for the optimism: Fewer Americans think inflation will impact them. Among those who are optimistic about their finances next year, 36 percent say they feel that way because of lower levels of inflation, which is up 17 percentage points from a similar survey Bankrate ran in 2023. Among those who think their finances won’t improve, 44 percent blamed continued high inflation. That’s down from 61 percent in 2023.

Inflation has been steadily trending toward the Federal Reserve’s target of 2 percent after hitting a 41-year record high in 2022. According to the Bureau of Labor Statistics’ consumer price index (CPI) report, inflation in November came in at 2.7 percent, up slightly from the prior month and in line with economists’ expectations.

More Americans appear to be optimistic about their finances this year as they look ahead to 2025, according to the survey. Nearly half (44 percent) said they expect their finances will improve next year, which is up from 37 percent who said the same in a 2023 survey (regarding their finances 2024) and 34 percent who said so in a 2022 survey (regarding their finances in 2023).

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Roughly 1 in 3 Americans (33 percent) think their finances will stay about the same and 23 percent think they’ll get worse, including 10 percent who think they’ll get significantly worse. Combined, that means 56 percent don’t expect their financial situation to improve next year.

Source: Bankrate survey, Nov. 6-8, 2024

Across generations, those who expect their finances to get better next year include:

  • 55 percent of Gen Z (ages 18-27)

  • 49 percent of millennials (ages 28-43)

  • 38 percent of Gen X (ages 44-59)

  • 37 percent of baby boomers (ages 60-78)

Those who think they will get worse include:

Every week, Bankrate publishes proprietary surveys, studies and rate data, providing the latest data-driven insights on the state of Americans’ personal finances — including credit card debt, homeownership, insurance, retirement and beyond.

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Even though inflation is tamer now compared to the last two years, the pain of rising prices hasn’t completely subsided. The prices of goods and services are still rising — just not as quickly as before. Inflation continues to show up in Americans’ daily lives, from groceries to car insurance to rent, and wages are still playing catch-up. According to Bankrate’s Wage to Inflation Index, wages aren’t projected to fully recover from inflation until the second quarter of 2025.

Forty-four percent of those who think their financial situation will not improve next year blame continued high inflation. That compares to 61 percent who cited it a year ago. Other top reasons why Americans think their finances will not improve include work done by elected officials (30 percent), stagnant or reduced income (28 percent) and the amount of debt they have (20 percent).

Source: Bankrate survey, Nov. 6-8, 2024
Note: Percentages are of U.S. adults who think their personal financial situations will not improve in 2025.

On a more optimistic end of the spectrum, for those who think their financial situation will improve next year, 36 percent cite lower levels of inflation as a reason. Other popular reasons are rising income from employment, Social Security, a pension, etc. (35 percent); having less debt (30 percent); and better spending habits (25 percent).

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Source: Bankrate survey, Nov. 6-8, 2024
Note: Percentages are of U.S. adults who think their personal financial situations will get better in 2025.

Additionally, 25 percent who believe their finances will get better in 2025 give credit to work done by elected officials. Following the election, our survey shows that many Americans view elected officials as either hindering potential financial progress or as a catalyst for improvement. While this shows a continuing political division, Hamrick suggests identifying financial goals and working toward them, regardless of political beliefs.

“Political cycles come and go, but the need to attend to our financial well-being remains,” he says.

The most common main financial goal cited by Americans for 2025 is paying down debt (21 percent), and that percentage tends to rise with age. Generationally, that breaks down to:

Carrying credit card debt is costly, but it’s become more common over the last few months. As of June 2024, at least half of Americans carry a credit card balance from month to month, according to Bankrate’s Credit Card Debt Survey. That’s up from 44 percent in January 2024, and the highest percentage since March 2020 (60 percent).

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“Average credit card interest rates top 20 percent (still close to a record high),” Hamrick says. “Targeting high-cost debt can provide an immediate benefit.”

Source: Bankrate survey, Nov. 6-8, 2024
*(e.g., vacation, home renovation, big ticket item, etc.)

Saving more for emergencies is the second most common main financial goal among Americans (12 percent), followed by getting a higher-paying job or an additional source of income (11 percent) and budgeting spending better (10 percent).

Roughly 1 in 10 Americans (11 percent) say they have no financial goals for 2025. Baby boomers are the most likely generation to say they have no financial goals for the next year:

  • Gen Z: 6 percent

  • Millennials: 10 percent

  • Gen X: 9 percent

  • Baby boomers: 16 percent

Of those who identified a financial goal for 2025, 43 percent say that it’s a New Year’s resolution they’ll address immediately.

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Thirty-five percent say it’s a medium-term issue, meaning they’ll address it once they’ve had some time to think and plan. Thirteen percent called their main financial goal a long-term issue and will address it after they’ve had an extended period to do research or find advice.

One in 10 Americans (10 percent) said they don’t know how they’ll address their main financial goal in the coming year.

Source: Bankrate survey, Nov. 6-8, 2024
Note: Percentages are of U.S. adults who have a financial goal in 2025.

Over the last few years, there has been a disconnect between how well the economy is doing and how people feel about their financial standing. The economy has managed to avoid a recession for a few years, inflation has been tamed, interest rates have fallen and the job market continues chugging along. Yet the positive economic data hasn’t aligned with Americans’ perceptions of the economy.

Bankrate’s new Financial Outlook survey shows a possible shift in that narrative. Americans may be warming up to the idea that the economy — and everything related to their finances — will hold up better in 2025.

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Regardless of what’s anticipated, financial experts recommend “future-proofing” your finances, and the New Year is a great opportunity to get ahead. To make progress in 2025, especially following the holidays, take the time to get a comprehensive understanding of where your current finances stand, set new financial goals and put together a financial plan. Hamrick recommends regularly checking in on your finances and goals to make sure you’re staying the course.

“It is one thing to have a financial goal, it’s another to act upon it,” Hamrick says. “Once past the new year, consider scheduling monthly or quarterly check-ins to assess your progress. Tiny changes can lead to big results, particularly with money.”

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Quicken Launches New Tool to Protect Your Financial Documents: Is it Worth it?

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Quicken Launches New Tool to Protect Your Financial Documents: Is it Worth it?

We prepare for many financial events, from retirement to college planning for our kids. However, there’s one side of financial planning that we might ignore: Securing our documents. This is a pretty common thing too, as the National Household Survey on Disaster Preparedness found only 30% of people safeguard their documents.

With that in mind, what happens if someone breaks into our homes and steals them? Or, a natural disaster destroys them? This is where having a digital solution can help.

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