Finding Financial Independence

By Chris Duderstadt

June 28, 2022

Finding Financial Independence

Key Points – Finding Financial Independence

  • What Is Financial Independence?
  • How Do You Know When You Have Enough to Retire?
  • Clarity, Confidence, and Control of Your Financial Life Is What Financial Independence Is All About
  • Have a Fun and Safe Fourth of July Weekend!
  • 5 Minutes to Read | 9 Minutes to Listen

Happy Fourth of July!

Millions of Americans are gearing up to celebrate their various freedoms at U.S. citizens for Fourth of July weekend. At Modern Wealth Management, one of the freedoms we enjoy celebrating year-round is the ability to attain financial independence. Bud Kasper joins Dean Barber for the Modern Wealth Management Educational Series to discuss the journey toward reaching financial independence and what financial independence could mean for you.


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Dean’s Favorite Holiday

The Fourth of July is always a fun-filled family affair for the Barber’s, so it’s easy to understand why it’s his favorite holiday. He knows his family isn’t alone with that line of thinking and how they celebrate either. Dean is thankful for all the freedoms he has as an American. Feeling the freedom of financial independence is a bonus for Dean, and he’s passionate about others achieving it as well.

What is Financial Independence?

So, what exactly is financial independence and how do you know when you’ve found it?

“To me, financial independence means that you get to get up every morning and do the things you want to do because it’s what you want to do and not because you think you need to have a paycheck. That’s when you know that you’re truly financially independent,” Dean said. “If you choose to continue to work, it’s because it’s what you want to do. Bud and I are financially independent, but we do what we do because we love what we do.”

While Dean and Bud know that they are financially independent, so many other people are as well but don’t realize it. Dean, Bud, and the rest of our Modern Wealth Management team strive every day to help people see where they are at in their respective journey toward financial independence.

“People think that they need to have some dollar amount or put an arbitrary goal out there,” Dean said. “But our clients who have gone through the planning process using our Guided Retirement System know if they’re financially independent or close to it. Maybe they were there two years ago and just didn’t know it until going through the planning process.”

An Example of the Realization of Being Financially Independent

Of course, Dean and Bud have a wealth of scenarios to reference regarding hopeful retirees who are yearning for financial independence. There was a couple who was referred to Dean that was living in Central Kansas and asked Dean that question that he so often hears. Do we have enough to retire? In other words, are we financially independent?

So, Dean went through the financial planning process with them. The clarity of that process showed them that they both could retire whenever they wanted to.

“It was a scenario where they were saying, ‘Really? Really?!? We can do that?’ I said, ‘Yeah. You can do it. Whether you choose to or not is up to you,’” Dean said. “The comment I almost always get when I share that with somebody is that it just changes their whole attitude about work. It means they’re no longer beholden to their company. They can choose at any time to walk out and financially be just fine.”

Getting That Financial Clarity from a CERTIFIED FINANCIAL PLANNER™ Professional

The decision to retire is a life-changing one. Therefore, it’s vital that you know with absolute certainty that you have enough to retire when you decide to retire. There is a lot of trust involved with hiring a financial advisor to help with making that decision. Anyone can call themselves an advisor, which makes working with CERTIFIED FINANCIAL PLANNER™ Professional that much more important so that you receive the clarity and confidence that’s crucial to one’s retirement.

“As the CEO of Modern Wealth Management, Dean advises for everyone to be CFP® professionals. It’s highly meaningful,” Bud said. “People have probably seen enough advertisements to know that CFP® professionals are directed to help clients achieve financial independence. That only comes through understanding the plan and making sure the information we have in the plan is completely detailed. That ranges from Social Security, taxes, Medicare, investments, etc.”

Dean has seen that a lot of people who first try to put together a financial plan on their own don’t understand the tax impact if one spouse passes away. The surviving spouse then becomes a single taxpayer, and the tax burden increases exponentially.

Stress-Testing Your Financial Plan

Along with accounting for all those things Bud mentioned, the Guided Retirement System also stress tests your financial plan through other time periods and similar market cycles to help determine its probability of success. With the S&P 500 entering bear market territory a couple of weeks ago, a lot of people are wondering if they still have enough to retire and if they’ll be OK. Stress testing your plan against through previous bear markets is a good place to start.

“How much of the downside of the stock market that you want to participate in is going to be on your personal risk tolerance,” Bud said. “If you don’t know what that is, we will help to show you what that is.”

Seeking Financial Independence

When you get within five to 10 years from your desired retirement date, the focus on becoming financially independent tends to intensify. However, the quest toward financial independence begins long before that. It starts in our adolescence.

“We all can’t wait to get out of mom and dad’s house because we want to be independent. Then, you’re in college,” Dean said. “It’s usually a lot more work than you thought it would be, but then you get your first real job and think you’ll be independent. But then, you’re working for someone else and you don’t have that independence. You need to do what that employer says.”

Clarity, Confidence, and Control

As you can see, the road to financial independence is a long one. It’s important to have a road map to guide you along the way, especially as you’re nearing retirement. Dean and Bud have worked in the financial services industry for 35 and 38 years, respectively, so they’ve become very familiar with that process.

“There are so many times where one spouse is ready to retire or make a big purchase in retirement, while the other spouse may think otherwise. With the plan and clarity that it gives, that’s where the confidence really comes in. Ultimately, there’s a sense of control with your plan. Clarity, confidence, and control help let you know if you’re there. That’s the feeling of financial independence. You get to wake up every day and do what you want to do for the reasons that are important to you. It’s no longer about a paycheck and it changes the dynamic of your life.”

Your Financial Plan Needs to Be Flexible and Agile

While that is a gratifying feeling, you can’t just set it and forget it with your financial plan once you’ve reached retirement. These uncertain times and tremendous market volatility that we’ve experienced in 2022 have highlighted the importance of that.

“That’s why we insist to meet with you about every six months because financial data changes and you change. Maybe you have a vacation planned that’s a little bit more excessive than a typical vacation,” Bud said. “Will that change the outcome of your plan? Well, we can give you that clarity and make adjustments within your plan so you can reach your retirement goals.”

A Great Opportunity to Examine Your Financial Independence

We know that many of you might be on one of those vacations during Fourth of July weekend or are preparing for one later this summer. So, along with sitting back and relaxing while watching some fireworks this weekend, take a moment to reflect on where you’re at on the journey of financial independence.

If you’re not quite there yet, that’s OK! We’re here to help you. Our industry-leading financial planning software can help you on your financial independence quest, and you can use it from the comfort of your own home.

Start Planning

If you feel like you have reached financial independence, that’s great! Nevertheless, it’s imperative to have a fluid financial plan throughout your retirement and to work with a CERTIFIED FINANCIAL PLANNER™ Professional to maintain clarity, confidence, and control in your financial life. If you have any questions regarding financial independence, you can schedule a complimentary consultation or 20-minute “ask anything session with one of our CERTIFIED FINANCIAL PLANNER™ Professionals. They can meet with you in person, during a virtual meeting, or by phone.

Schedule Complimentary Consultation

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Investment advisory services offered through Modern Wealth Management, LLC, an SEC Registered Investment Adviser.

The views expressed represent the opinion of Modern Wealth Management an SEC Registered Investment Adviser. Information provided is for illustrative purposes only and does not constitute investment, tax, or legal advice. Modern Wealth Management does not accept any liability for the use of the information discussed. Consult with a qualified financial, legal, or tax professional prior to taking any action.