Build Core Strength: Cash Flow
Every fitness program starts with building strength, and your financial foundation is no different. Your emergency fund must be the core muscle that supports everything else you hope to accomplish financially.
According to Bankrate’s 2025 Annual Emergency Savings Report, only 46% of Americans would have enough savings to cover 3 months of expenses if a crisis hit. If you’re unclear where you stand:
- Calculate 1 month worth of expenses: Account for all monthly expenses, ranging from your mortgage payments to macchiatos. Factor in the costs of rent/mortgage, groceries, transportation, insurance, loan payments, utilities, and healthcare expenditures.
- Calculate 3 months' worth of expenses: Multiply your monthly expenses by 3.
- Calculate 6 months' worth of expenses: Multiply your monthly expenses by 6.
- Compare: Compare the total amount in your emergency fund to the 3-month and 6-month amounts. If your savings fall within this range, you’ve met your target and reached a financial fitness milestone!
Improve Flexibility: Anticipate the Unexpected
Financial flexibility keeps you prepared when life throws unexpected curves. Using BCT’s Money Management Tool as your personal trainer will keep you prepared for surprise expenditures that come your way.
This easy-to-use digital platform categorizes expenses, tracks spending patterns, and helps identify optimization opportunities. Unlike generic budgeting apps, our tool integrates seamlessly with your BCT accounts, providing real-time insights into your financial habits.
Build flexibility using the 50/30/20 rule as a starting point (50% needs, 30% wants, 20% savings). Like all things in life, the goal isn't perfection; it's progress!
Hone Your Heart Rate: Prep Your Estate Plan
Estate planning is the heartbeat of financial planning that keeps your legacy pumping across generations. BCT Wealth’s blog series on estate planning, Real Life Adventures in Estate Planning Part I and Part II, emphasizes the importance of estate planning. Planning your estate keeps your legacy and your relationships healthy, as it reduces surprises, allows for emotional preparation, and helps you remain in control.
Estate planning conversations may differ depending on the ages of your heirs. For best results, tailor these conversations according to these life stages:
- Ages 20-30: Discuss your values and principles instead of specific dollar amounts
- Ages 40-50-60: Have detailed, practical discussions about inheritances, healthcare directives, document locations, contacts, and immediate responsibilities
BCT’s wealth experts can coach you through the process of estate planning, helping you grow and protect your assets for the next generation. We create custom investment approaches designed to build your wealth over time while keeping your long-term goals in mind.
Appoint a Spotter: Purchase an Umbrella Policy
Think of umbrella insurance as the spotter for your financial weightlifting. In the gym, a spotter is the person who stands by to assist when you're lifting heavy weights, ready to catch the weight if it becomes too much. In your financial life, umbrella insurance plays the same role. While auto and homeowners insurance offer basic coverage, umbrella insurance comes to the rescue when your claims exceed those limits.
If you face a major lawsuit that exceeds your current insurance coverage, you'll be personally responsible for paying the remaining costs without an umbrella policy. Umbrella insurance provides the additional coverage that shields your assets from the financial impact of unexpected accidents or liability claims that go beyond your standard policy limits. Most umbrella policies cost just $200-500 annually for $1-2 million in coverage. This is a small price for significant financial protection.
Track Your Progress: Schedule an Annual Check-In
Tracking your progress in the gym helps you see how far you’ve come and where to focus next. The same goes for your finances. Reviewing these key elements of your plan will optimize your financial health, especially since major life changes can interfere with your long-term plans. While the unexpected is unsettling, life changes like the following are reasons to reevaluate your financial planning, estate, and documentation on an annual basis:
- Marriage, divorce, birth, and death
- Job loss or career changes
- Inheritance or business changes
- Illness or disability
- Major purchases
Start Your Financial Fitness Journey Now
The best financial plan is the one you'll actually follow. By thinking of financial planning as an ongoing fitness routine rather than a one-time event, you're more likely to develop habits that will serve you well in every season of life.
Ready to begin your financial fitness journey? Contact BCT Wealth Advisors today to build the muscle that will move you toward your goals.
Contributed by: Emma Pedraza, CFP®, Wealth Advisor, BCT Wealth Advisors
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