Total Term

What Is Total Term (Tt)?

Total Term estimates the number of years your client could live on their net worth assuming no growth, inflation, or taxes. This includes cash, investments, business equity, and real estate equity.

How Is Total Term (Tt) Calculated?

Why Is Total Term (Tt) Important?

Typically, at the core of most clients’ goals are some personalized versions of “freedom” or “security”.  And to that end, clients often ask questions like “how am I doing?” or “do I have enough money?”

Total Term is a quick and easy way to answer that question. It provides an easy way to explain to your client how they’re doing by framing the answer in an easy to understand way – how long they could live off of their current net worth.

A traditional long-term retirement projection is useful in certain cases, but it’s “expensive” (i.e. time consuming) as the basis for an ongoing monitor of “where am I?”  (and the implied precision can actually provide a false sense of certainty in some cases).  Alternatively, Total Term is an efficient tool at broadly understanding and conveying current health and progress towards financial independence.

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