This is a guest post by Neal Frankle, CFP ®. Neal is an author and avid blogger. To learn more, visit

You only need three things to be successful with your finances – but if you do want to be successful, you need all three. They are clarity, knowledge and action.


Clarity is really about knowing yourself. Knowing what’s important about money….to you – not somebody else. Knowing why you go to work.

Having this clarity is crucial because when you are clear about your values and compare them to how you live your financial life, you have a benchmark for success or failure.

For example, let’s say you tell me that money is important to you because it helps you provide security for your ingredientsfamily. Fine. But if you examine the way you conduct your financial affairs is it consistent? Do you waste money in certain areas? And does that waste actually create financial insecurity? Do you invest in ways that provide security (long and short-term) or do you make risky bets? Do you go on vacations you can’t afford? Do you give gifts without first saving for your own family? Do you even have a financial plan?

Be clear on your goals and determine if your actions are consistent with those goals?

Also, when it comes to clarity, be aware of your character defects. Don’t try to sweep the dirt under the carpet. If you have character flaws (and who doesn’t?), be honest about them. If you ignore your shortcomings and pretend they don’t exist, you’ll never escape the consequences of having them.


The second thing you need in order to be financial successful is knowledge. Understand how investments work. How debt works. How credit cards work. Trusts, wills , life insurance etc. You don’t need to master these subjects immediately. There are plenty of great resources (like this blog) that will help you gain an understanding over time. You don’t need expensive courses or a vast library.

Money is not complicated and it’s not rocket science. Of course, some financial advisors would make you believe that it is but don’t pay attention. You can easily gain a working understanding of how money works and as a result, make excellent financial decisions on your own.


The third ingredient is action. Folks often get stuck like a deer in the headlights.
It’s understandable because there is no certainty in the world of money. You can look at studies and do the research but at the end of the day there is no sure thing. This is not science – at least over the short-run it’s not. At some point after you have the clarity and the knowledge, you have to take action. You have to pull the trigger. You have to make the investments, track your expenses, and get the living trust done. Whatever it is… have to just do it.
The most important point to keep in mind when it comes to action in the financial realm is that perfect is the enemy of good. If you wait for the perfect time to buy that house or mutual fund , forget it. The perfect time never comes. If you are waiting to create your trust until you know who your beneficiaries are going to be, you are either lying to yourself or you don’t have sufficient knowledge. The truth is, you can change your beneficiaries whenever you want to. It’s usually better to have the wrong beneficiary and have a trust than not to have a trust at all.

Are you waiting to invest in the market until you understand it completely? I’ve been trying to understand the stock market for the last 25 years and I still don’t get it.. Does it mean I’ve made some mistakes? Absolutely. But I’m much better off having taken action than had I waited.

Do you have the clarity and knowledge you need to put your financial house in order? If not, what action are you going to take today?