<PAGE>
================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                   FORM 10-QSB

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                For the Quarterly Period Ended September 30, 2001

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

       For the transition Period from ________________ to ________________

                        Commission file number 000-24057

                         Rushmore Financial Group, Inc.
                         ------------------------------
             (Exact name of registrant as specified in its charter)

         Texas                                            75-2375969
         -----                                            ----------
(State of Incorporation)                  (I. R. S. Employer Identification No.)

                 13355 Noel Road, Suite 300, Dallas, Texas 75240
                ------------------------------------------------
                                  972-385-9595
                ------------------------------------------------
                (Issuer's telephone number, including area code)

         Check whether the issuer filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by the court.

                               Yes [ ]   No [ ]

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                               Yes [X]   No [ ]

         State the number of shares outstanding of each of the issuer's classes
of common equity as of September 30, 2001: 6,167,020 shares of common stock,
$0.01 par value.

         Transitional Small Business Disclosure Format;

                               Yes [ ]   No [X]


<PAGE>



PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements



                                                                               2
<PAGE>

            RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                       CONSOLIDATED BALANCE SHEET

<Table>
<Caption>
                                                                          (UNAUDITED)
                                                                          SEPTEMBER 30,     DECEMBER 31,
                                ASSETS                                         2001              2000
                                                                          -------------     ------------
<S>                                                                       <C>               <C>
Cash and cash equivalents                                                 $    135,540      $  1,218,317
Accounts receivable                                                            549,288           765,734
Prepaid expenses and deposits                                                  207,332           267,201
Property and equipment, net of accumulated depreciation                      2,063,258         1,037,723
Net assets of discontinued operations                                               --         3,267,574
Goodwill, net of accumulated amortization                                    1,146,838             1,486
                                                                          ------------      ------------
                Total assets                                              $  4,102,256      $  6,558,035
                                                                          ============      ============

                  LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
     Accounts payable                                                     $  1,083,080      $    318,749
     Notes payable                                                             407,086           169,741
     Accrued expenses & other liabilities                                      152,670            41,588
                                                                          ------------      ------------
                Total liabilities                                            1,642,836           530,078
                                                                          ------------      ------------

Shareholders' Equity:
     Preferred stock-9% cumulative preferred stock, $10 par value,
          2,000 shares issued and outstanding at September 30, 2001             20,000            20,000
          and December 31, 2000
     Preferred stock-Series A cumulative preferred stock, $10 par
          value; 12,063 shares issued and outstanding at                       120,630           120,630
          September 30, 2001 and December 31, 2000
     Preferred stock-Series B convertible cumulative preferred stock:
          $10 par value; 13,520 shares issued and outstanding at               135,200           135,200
          September 30, 2001 and December 31, 2000
     Preferred stock-Series C convertible cumulative preferred stock:
          $10 par value; 41,460 shares issued and outstanding at               414,600                --
          September 30, 2001; no shares issued at December 31, 2000
     Subscriptions received on Series C convertible cumulative
          preferred stock: 3,101 shares                                         31,016                --
     Common stock-$0.01 par value, 10,000,000 shares authorized;
          6,853,898 shares issued at September 30, 2001; 4,644,253              68,539            46,443
          shares issued at December 31, 2000
     Additional paid in capital                                             12,061,002        10,872,393
     Treasury stock, at cost-686,878 shares at September 30, 2001;            (421,022)         (116,345)
          89,873 shares at December 31, 2000
     Accumulated deficit                                                    (9,970,545)       (5,050,364)
                                                                          ------------      ------------
                Total shareholders' equity                                   2,459,420         6,027,957
                                                                          ------------      ------------

                                                                          ------------      ------------
                Total liabilities and shareholders equity                 $  4,102,256      $  6,558,035
                                                                          ============      ============
</Table>


           See accompanying notes to consolidated financial statements


                                                                               3
<PAGE>

                 RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS For the
             Three and Nine Months ended September 30, 2001 and 2000
                                   (unaudited)

<Table>
<Caption>
                                                                              FOR THE THREE MONTHS           FOR THE NINE MONTHS
                                                                               ENDED SEPTEMBER 30,            ENDED SEPTEMBER 30,
                                                                            --------------------------    -------------------------
                                                                                2001           2000           2001          2000
                                                                            -----------    -----------    -----------   -----------
<S>                                                                         <C>            <C>            <C>           <C>
Revenue:
     Insurance Services:
         Insurance policy income                                            $    98,079    $   242,077    $   398,995   $   968,089
         Agency management fee                                                   64,597         92,933        226,448       307,485
     Investment Services:
         Commissions and fees                                                 1,950,147      1,295,202      5,305,500     2,962,967
     Other                                                                       20,799          8,804         57,861        21,694
                                                                            -----------    -----------    -----------   -----------
            Total revenues                                                    2,133,622      1,639,016      5,988,804     4,260,235
                                                                            -----------    -----------    -----------   -----------
Expenses:
     Insurance Services:
         Commission expense                                                      74,072        196,177        288,495       755,264
         Other insurance services expenses                                        2,584          4,921         20,913        30,384
     Investment Services:
         Commission expense                                                   1,467,361        311,123      3,920,602     1,347,931
         Other investment services expenses                                     191,735         97,976        615,011       303,807
     General and administrative                                                 960,821        699,049      3,040,455     2,427,255
                                                                            -----------    -----------    -----------   -----------
            Total expenses                                                    2,696,573      1,309,246      7,885,476     4,864,641
                                                                            -----------    -----------    -----------   -----------
            Operating income (loss)                                            (562,951)       329,770     (1,896,672)     (604,406)
Other Expense:
     Interest expense                                                           (10,460)        (4,103)       (30,293)      (14,887)
                                                                            -----------    -----------    -----------   -----------
Income (loss) from continuing operations                                       (573,411)       325,667     (1,926,965)     (619,293)
                                                                            -----------    -----------    -----------   -----------

Discontinued operations
     Income (loss) from discontinued operations, net of tax benefits
         of $22,356 for the nine month period in 2000 and tax expense
         of $3,408 for the three month period in 2000                                --        (51,944)       (95,743)       27,279
     Loss from disposition of discontinued
        operations                                                           (2,897,473)            --     (2,897,473)           --

                                                                            -----------    -----------    -----------   -----------
Net income (loss)                                                           $(3,470,884)   $   273,723    $(4,920,181)  $  (592,014)
                                                                            ===========    ===========    ===========   ===========

Basic and diluted income (loss) per share of
    common stock, continuing operations                                     $     (0.10)   $      0.08    $     (0.35)  $     (0.16)
                                                                            ===========    ===========    ===========   ===========

Basic and diluted net income (loss) per share of
    common stock                                                            $     (0.56)   $      0.06    $     (0.87)  $     (0.16)
                                                                            ===========    ===========    ===========   ===========

   Weighted average common shares outstanding                                 6,185,154      4,121,447      5,669,580     3,887,141
</Table>

           See accompanying notes to consolidated financial statements

                                                                               4
<PAGE>


           RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS
               For the nine months ended September 30,

<Table>
<Caption>
                                                                                    2001             2000
                                                                                 -----------      -----------
<S>                                                                              <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
       Loss from continuing operations                                           $(1,926,965)     $  (619,293)
       Adjustments to reconcile loss from continuing operations
         to net cash used in operating activities
            Expenses paid by issuance of common stock                                 87,000           82,238
            Depreciation and amortization                                            194,571          151,509
            Gain on sale of computer software                                             --         (772,333)
            CHANGE IN ASSETS AND LIABILITIES, NET OF EFFECT OF THE NORTHSTAR
               ACQUISITION IN 2001:
               (Increase) decrease in assets:
                 Accounts receivable                                                 226,740           76,100
                 Prepaid expenses and deposits                                        (9,300)          74,165
               Increase (decrease) in liabilities:
                 Accrued expenses and other liabilities                              287,330           (5,397)
                                                                                 -----------      -----------
Net cash used in operating activities-continuing operations                       (1,140,624)      (1,013,011)
                                                                                 -----------      -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
       Purchase of equipment                                                        (981,584)        (156,287)
       Cash received on sale of computer software                                         --        1,500,000
       Cash received on purchase of Northstar companies                               11,047               --
                                                                                 -----------      -----------
Net cash provided by (used in) investing activities                                 (970,537)       1,343,713
                                                                                 -----------      -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
       Proceeds from sale of Common Stock, net of offering costs                     530,820        1,206,979
       Proceeds from sale of Preferred Stock, net of offering costs                  365,929          135,200
       Redemption of Preferred Stock                                                      --          (16,240)
       Preferred Stock subscriptions received                                         31,016               --
       Preferred Stock dividends paid                                                (38,244)         (21,600)
       Payments on notes payable                                                    (134,274)        (249,995)
       Proceeds from notes payable                                                   303,456          131,443
                                                                                 -----------      -----------
Net cash provided by financing activities                                          1,058,703        1,185,787
                                                                                 -----------      -----------

Net cash provided by (used in) continuing operations                              (1,052,458)       1,516,489

Net cash provided by (used by) discontinued operations                               (30,319)         213,667

Change in cash and cash equivalents                                               (1,082,777)       1,730,156
Cash and cash equivalents at beginning of period                                   1,218,317          378,745
                                                                                 -----------      -----------
Cash and cash equivalents at end of period                                       $   135,540      $ 2,108,901
                                                                                 ===========      ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
       Cash paid for interest                                                    $    26,533      $    14,887
       Cash paid for income taxes                                                $        --      $        --

NON-CASH TRANSACTION - SEE NOTE 3, PARAGRAPH 1
</Table>

           See accompanying notes to consolidated financial statements


                                                                               5
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The financial statements included herein have been prepared by Rushmore
Financial Group, Inc. ("Company" or "RFGI") without audit, pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted pursuant to such rules and regulations,
although the Company believes that the disclosures contained herein are adequate
to make the information presented not misleading. In the opinion of management,
the information furnished in the unaudited consolidated financial statements
reflects all adjustments which are ordinary in nature and necessary to present
fairly the Company's financial position, results of operations and changes in
financial position for such interim period. These interim financial statements
should be read in conjunction with the Company's financial statements and the
notes thereto as of December 31, 2000, included in the Company's annual report
on Form 10-KSB for the year ended December 31, 2000.

Rushmore Insurance Services, Incorporated ("Rushmore Agency") is an insurance
agency and an affiliate of the Company by means of service agreements. The
Company has entered into an administrative services agreement whereby net
revenues and expenses are charged via a management fee to the Company. Rushmore
Agency has been consolidated in the accompanying consolidated financial
statements.


2. Industry Segment Information

The following summarizes the Company's identifiable assets by industry segment
as of the dates indicated:

<Table>
<Caption>
                       September 30,  December 31,
Identifiable Assets         2001          2000
-------------------    -------------  ------------
<S>                    <C>            <C>
Insurance Services      $   85,672     $  138,995
Investment Services      2,839,789      2,307,695
Corporate                1,176,795        843,771
                        ----------     ----------
          Total         $4,102,256     $3,290,461
                        ==========     ==========
</Table>

The following summarizes the Company's industry segment operating data for the
periods indicated:

<Table>
<Caption>
                               Three Months Ended September 30,             Nine Months Ended September 30,
                               --------------------------------            --------------------------------
       Revenues                   2001                 2000                  2001                 2000
       --------                ----------            ----------            ----------            ----------
<S>                            <C>                   <C>                   <C>                   <C>
Insurance Services             $  162,676            $  335,010            $  625,443            $1,275,574
Investment Services             1,950,147             1,295,202             5,305,500             2,962,967
Corporate                          20,799                 8,804                57,861                21,694
                               ----------            ----------            ----------            ----------
          Total                $2,133,622            $1,639,016            $5,988,804            $4,260,235
                               ==========            ==========            ==========            ==========
</Table>

<Table>
<Caption>
                               Three Months Ended September 30,            Nine Months Ended September 30,
                               --------------------------------            --------------------------------
       Expenses                   2001                 2000                   2001                 2000
       --------                ----------            ----------            ----------            ----------
<S>                            <C>                   <C>                   <C>                   <C>
Insurance Services             $  131,604            $  278,395            $  512,696            $1,027,154
Investment Services             2,081,655               763,709             6,020,396             2,760,595
Corporate                         483,314               267,142             1,352,384             1,076,892
                               ----------            ----------            ----------            ----------
          Total                $2,696,573            $1,309,246            $7,885,476            $4,864,641
                               ==========            ==========            ==========            ==========
</Table>

<Table>
<Caption>
                               Three Months Ended September 30,             Nine Months Ended September 30,
 Income (Loss) from            --------------------------------             -----------------------------------
Continuing Operations             2001                 2000                    2001                 2000
---------------------          -----------          -----------             -----------         -----------
<S>                            <C>                  <C>                     <C>                 <C>
Insurance Services             $    31,072           $   56,615            $   112,747          $   248,420
Investment Services               (131,508)             531,493               (714,896)             202,372
Corporate                         (472,975)            (262,441)            (1,324,816)          (1,070,085)
                               -----------           ----------            -----------          -----------
          Total                $  (573,411)          $  325,667            $(1,926,965)         $  (619,293)
                               ===========           ==========            ===========          ===========
</Table>


                                                                               6
<PAGE>

3. Discontinued Operations

In June 2000, subject to certain conditions, the Company entered into an
agreement to "spin off" Rushmore Investment Advisors, Inc., ("Rushmore
Advisors"), a subsidiary of the Company engaged in investment portfolio
management and advice. In May 2001 the Company determined that a "spin-off" was
not the appropriate method to divest itself of Rushmore Advisors. In September
2001 the Company entered into an agreement, with an effective date of August 1,
2001, to sell Rushmore Advisors to Mr. John Vann for 597,405 shares of the
Company's common stock plus a note for $200,000. This note was subsequently
discounted to $100,000 and paid. As part of the sale, Mr. Vann also retained the
right to prepay his existing note of $280,319 to the Company at a discount. This
note was subsequently discounted to $150,000 and paid. The sale, including the
discounted note payoffs, resulted in a one-time non-operating loss of
approximately $2,900,000 in September.

In December 2000, the Company entered into a sales agreement to sell Rushmore
Life Insurance Company ("Rushmore Life"), a subsidiary of the Company previously
engaged in the reinsurance of the life insurance policies written by the
Company's sales agents. The sales price of $266,997 represents the residual
value of Rushmore Life since the sale of several insurance blocks, or the
statutory net worth of Rushmore Life at December 31, 2000.

Rushmore Life was sold as of December 31, 2000, and has no assets or
liabilities. The following table sets forth the assets, liabilities, revenue,
and net loss for Rushmore Advisors at June 30, 2001. Financial information for
Rushmore Advisors from July 1 until the sale date of August 1 is not available,
however, the results of operations of Rushmore Advisors for this period are
estimated to be immaterial to the transaction as a whole.

<Table>
<Caption>
                Assets                               June 30, 2001
                ------                               -------------
<S>                                                  <C>
Cash and Investments                                  $   17,077
Accounts Receivable                                      175,242
Prepaid Expenses & Deposits                               32,508
Property and Equipment, net                              161,442
Goodwill, net                                          3,200,919
                                                      ----------
             Total Assets                             $3,587,188
                                                      ----------

              Liabilities
              -----------
Accounts Payable                                      $  250,387
Notes Payable                                            164,970
                                                      ----------
           Total Liabilities                             415,357
                                                      ----------

                                                      ----------
Net assets of discontinued operation                  $3,171,831
                                                      ==========


Revenue                                               $  533,821

Loss from discontinued operations                     $  (95,743)
</Table>

The financial data relating to Rushmore Advisors and Rushmore Life is classified
as discontinued operations for all periods presented.


                                                                               7
<PAGE>

4. Earnings (Loss) Per Share

Earnings (loss) per share for the periods indicated are as follows:

<Table>
<Caption>
                                                 Three months ended                       Nine months ended
                                                     September 30,                           September 30,
          INCOME (LOSS) FROM                -------------------------------         -------------------------------
        CONTINUING OPERATIONS                  2001                2000                2001                2000
        ---------------------               -----------         -----------         -----------         -----------
<S>                                         <C>                 <C>                 <C>                 <C>
Income (loss) from continuing
     operations                             $  (573,411)        $   325,667         $(1,926,965)        $  (619,293)
Dividends on preferred stock                    (16,706)            (10,041)            (38,244)            (21,600)
                                            -----------         -----------         -----------         -----------
Income (loss) from continuing
     operations applicable to common
     shareholders                           $  (590,117)        $   315,626         $(1,965,209)        $  (640,893)
                                            ===========         ===========         ===========         ===========

Basic and diluted weighted average
    common shares outstanding                 6,185,154           4,121,447           5,669,580           3,887,141
Income (loss) per common share,
     basic and diluted                      $     (0.10)        $      0.08         $     (0.35)        $     (0.16)
</Table>

<Table>
<Caption>
                                                Three months ended                     Nine months ended
                                                    September 30,                         September 30,
        INCOME (LOSS) FROM                -------------------------------         -------------------------------
     DISCONTINUED OPERATIONS                 2001                2000                2001                2000
     -----------------------              -----------         -----------         -----------         -----------
<S>                                       <C>                 <C>                 <C>                 <C>
Income (loss) from discontinued
     operations                           $(2,897,473)        $   (51,944)        $(2,993,216)        $    27,279

Basic and diluted weighted average
    common shares outstanding               6,185,154           4,121,447           5,669,580           3,887,141
Income (loss) per common share,
     basic and diluted                    $     (0.46)        $     (0.02)        $     (0.52)        $        --
</Table>

<Table>
<Caption>
                                                Three months ended                      Nine months ended
                                                  September 30,                           September 30,
                                          -------------------------------         -------------------------------
        NET INCOME (LOSS)                    2001                2000                2001                2000
        -----------------                 -----------         -----------         -----------         -----------
<S>                                       <C>                 <C>                 <C>                 <C>
Net income (loss)                         $(3,470,884)        $   273,723         $(4,920,181)        $  (592,014)
Dividends on preferred stock                  (16,706)            (10,041)            (38,244)            (21,600)
                                          -----------         -----------         -----------         -----------
Net income (loss) applicable to
     common shareholders                  $(3,487,590)        $   263,682         $(4,958,425)        $  (613,614)
                                          ===========         ===========         ===========         ===========

Basic and diluted weighted average
    common shares outstanding               6,185,154           4,121,447           5,669,580           3,887,141
Net income (loss) per common
     share, basic and diluted             $     (0.56)        $      0.06         $     (0.87)        $     (0.16)
</Table>

5. Preferred Stock Sale

In February 2001 the Company issued a Private Placement memorandum offering for
sale its Series C Convertible Preferred Stock. The shares have a 9% cumulative
dividend, payable quarterly in cash, or in RFGI common stock, and are
convertible into common stock at a rate of $1.00 per share.


6. Related Party Transactions

On July 31 the Company borrowed $250,000 at 9% interest from Mr. Dewey Moore
Sr., the father of Company President Dewey Moore, Jr. The transaction was
approved by unanimous vote of the Company's Board of Directors, except that Mr.
Moore Jr. abstained from voting. The maturity date of the loan is January 27,
2002, and


                                                                               8
<PAGE>

the loan is secured by a pledge of intellectual property rights on the Company's
RushTrade on-line trading software. Further, the loan is accompanied by the
grant of warrants to purchase 50,000 shares of Company common stock at $0.50 per
share. The value assigned to the warrants was charged to expense.


7. Acquisition

In January 2001, the Company acquired several of the companies formerly part of
the Northstar financial group of companies.

Chiatello & Powell, Inc., dba Northstar Financial Services, a Texas corporation
engaged in business as a registered investment advisor, was purchased for
606,400 shares of the Company's restricted common stock, and is now a
wholly-owned subsidiary of Rushmore Securities Corporation. As part of the
acquisition transaction the firm's name was changed to Rushmore Investment
Management Corporation. The transaction was accounted for as a purchase.

Dominion Agency, Inc., dba Northstar Agency, a Texas corporation engaged in the
business of marketing life and health insurance products to consumers, was
purchased by Mr. Dewey M. Moore, Jr. (Chief Executive Officer of the Company)
because Texas insurance regulations do not permit an insurance agency to be
owned by a corporation. However, pursuant to an Overhead Services Agreement all
revenues and expenses of Dominion Agency are passed through to the Company as
permitted by regulatory requirements. The transaction was consummated in
exchange for 100,000 shares of the Company's restricted common stock.

Northstar Agency of Arizona, an Arizona corporation engaged in the business of
marketing life and health insurance products to consumers, was purchased for
25,000 shares of the Company's restricted common stock, and was accounted for as
a purchase. As part of the acquisition transaction, the firm's name was changed
to Rushmore Agency of Arizona, Inc. The firm is now a wholly-owned subsidiary of
the Company.

The Company also acquired certain assets and liabilities of Dominion
Institutional Services Corporation (a Texas corporation). The purchase price of
these assets and liabilities was 175,000 shares of the Company's restricted
common stock.

The following table summarizes the transactions:

<Table>
<Caption>
         Description                     Amount
         -----------                     ------
<S>                                    <C>
Purchase price:
  906,400 shares @ $0.75                  679,800

Less: Net Assets Acquired              $ (514,627)
                                       ----------

Goodwill recorded                      $1,194,427
                                       ==========
</Table>

8. New Accounting Pronouncements

In July 2001 the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 141 (SFAS 141), Business Combinations,
which eliminates the pooling method of accounting for business combinations
initiated after June 30, 2001. In addition, SFAS 141 addresses the accounting
for intangible assets and goodwill acquired in a business combination. This
portion of SFAS 141 is effective for business combinations completed after June
30, 2001. The Company does not expect SFAS 141 to have a material effect on the
Company's financial position or results of operations.

In July 2001 the FASB issued Statement of Financial Accounting Standards No. 142
(SFAS 142), Goodwill and Intangible Assets, which revises the accounting for
purchased goodwill and intangible assets. Under SFAS 142, goodwill and
intangible assets with indefinite lives will no longer be amortized, but will be
tested for impairment annually, and also in the event of an impairment
indicator. SFAS 142 is effective for fiscal years beginning after December 15,
2001. The Company expects that the elimination of the amortization of goodwill
upon adoption of


                                                                               9
<PAGE>

SFAS 142 will increase annual operating income by approximately $79,000. The
Company will adopt SFAS 142 on January 1, 2002.

In August 2001 the FASB issued Statement of Financial Accounting Standards No.
144 (SFAS 144), Accounting for the Impairment or Disposal of Long-lived Assets,
which revises the accounting for long-lived assets and superceded SFAS 121. The
Company will be required to implement SFAS 144 on January 1, 2002. The Company
has not yet determined the impact of this implementation on its financial
statements.


Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

Results of Operations

Three Months Ended September 30, 2001 and 2000

Revenues

The following table sets forth the components of the Company's revenues for the
periods indicated:

<Table>
<Caption>
                              Three Months Ending September 30,
                              ---------------------------------
     Revenues                    2001                   2000
     --------                 ----------             ----------
<S>                           <C>                    <C>
Insurance Services            $  162,676             $  335,010
Investment Services            1,950,147              1,295,202
Corporate                         20,799                  8,804
                              ----------             ----------
          Total               $2,133,622             $1,639,016
                              ==========             ==========
</Table>

Total revenue for the second quarter increased $494,606, or 30%, from 2000 to
2001. This increase was comprised primarily of an increase of $654,945 from
investment services operations, offset by a decrease of $172,334 in insurance
services operations.

Insurance Services revenue decreased $172,334, or 51%, from 2000 to 2001. This
decrease was generally the result of decreases of $143,725 in life and health
insurance product commissions and $21,194 in health association management fees.
This decrease is primarily due to management's decision to reposition the
Company, and divert its insurance marketing resources and efforts to concentrate
on the development and launch of its RushTrade direct access on-line trading
system.

Investment Services revenue increased $654,945, or 51%, from 2000 to 2001. The
increase consisted mainly of increases of $509,681 in brokerage commission
revenue, $316,657 in variable insurance and annuity commissions, $278,158 in
mutual fund commissions, $160,964 in 12-b-1 fees, and $175,764 in advisory fees;
offset by decreases of $51,886 in RushTrade on-line brokerage revenue and
$772,333 in gain on the sale of on-line brokerage software. The increases are
generally attributable to the 153 new sales representatives recruited by
Rushmore Securities in February and March from the former Northstar Securities
firm. The software sale gain was recorded in 2000 when the Company sold the
Block Trading software for a sales price of $1,500,000 and a gain of $772,333.


Expenses

The following table sets forth the components of the Company's expenses for the
periods indicated:

<Table>
<Caption>
                               Three Months Ending September 30,
                               ---------------------------------
      Expenses                    2001                   2000
      --------                 ----------             ----------
<S>                            <C>                    <C>
Insurance Services             $  131,604             $  278,395
Investment Services             2,081,655                763,709
Corporate                         483,314                267,142
                               ----------             ----------
          Total                $2,696,573             $1,309,246
                               ==========             ==========
</Table>


                                                                              10
<PAGE>

Total expenses increased $1,387,327 or 106%, from 2000 to 2001. The investment
services and corporate divisions recorded expense increases of $1,317,946 and
$216,172 respectively, while the insurance services division recorded an expense
reduction of $146,791.

Insurance Services expenses decreased $146,791, or 53%, from 2000 to 2001.
Commission expense decreased from $196,177 to $74,072 primarily as a result of
the decrease in life and health insurance commission revenue. Other general and
administrative expenses decreased $24,686, with the primary reductions being in
the categories of payroll costs, printing, and travel & entertainment expenses.

Investment Services expenses increased $1,317,946, or 173%, from 2000 to 2001.
Commission expense increased from $311,123 to $1,467,361, primarily due to the
increase in commission revenue. The additional staff and overhead associated
with the Northstar acquisition in February 2001 generated an increase in nearly
all operating expense categories over the same period last year, with the main
increases being in insurance, equipment rental, office rent, payroll, and
postage. Marketing expenses decreased $57,550 to $8,998, and legal and
professional fees decreased $18,026 to $7,201.


Operating income (loss) from continuing operations

The following table sets forth the components of the Company's income (loss) for
the periods indicated:

<Table>
<Caption>
                               Three Months Ending September 30,
 Income (Loss) from            ---------------------------------
Continuing Operations             2001                   2000
---------------------          ---------               ---------
<S>                            <C>                     <C>
Insurance Services             $  31,072               $  56,615
Investment Services             (131,508)                531,493
Corporate                       (472,975)               (262,441)
                               ---------               ---------
          Total                $(573,411)              $ 325,667
                               =========               =========
</Table>

Nine Months Ended September 30, 2001 and 2000

Revenues

The following table sets forth the components of the Company's revenues for the
periods indicated:

<Table>
<Caption>
                               Nine Months Ending September 30,
                               --------------------------------
      Revenues                    2001                  2000
      --------                 ----------            ----------
<S>                            <C>                   <C>
Insurance Services             $  625,443            $1,275,574
Investment Services             5,305,500             2,962,967
Corporate                          57,861                21,694
                               ----------            ----------
          Total                $5,988,804            $4,260,235
                               ==========            ==========
</Table>

Total revenue increased $1,728,569, or 41%, from 2000 to 2001. This increase was
comprised primarily of an increase of $2,342,533 from investment services
operations, offset by a decrease of $650,131 in insurance services operations.

Insurance Services revenue decreased $650,131, or 51%, from 2000 to 2001. This
decrease is generally attributable to decreases in life and health insurance
products of $568,736 and $52,589 in health association management fees. This
decrease is primarily due to management's decision to reposition the Company,
and divert its insurance marketing resources and efforts to concentrate on the
development and launch of its RushTrade direct access on-line trading system.

Investment Securities revenue increased $2,342,533, or 79%, from 2000 to 2001.
This increase consisted mainly of increases of $1,031,759 in brokerage revenue,
$683,892 in mutual fund commissions, $758,862 in variable life and annuity
revenue, $318,309 in 12-b-1 fees, and $439,170 in advisory fees. The increases
are generally attributable to the 153 new sales representatives recruited by
Rushmore Securities in February and March from the former Northstar Securities
firm.


                                                                              11
<PAGE>

Investment Securities revenue increases are offset by decreases of $269,695 in
RushTrade on-line brokerage revenue and $772,333 in gain on the sale of on-line
brokerage software. The majority of the RushTrade decrease is attributable to a
decrease of $167,500 in one-time software licensing sales. The software sale
gain was recorded in 2000 when the Company sold the Block Trading software for a
sales price of $1,500,000 and a gain of $772,333.


Expenses

The following table sets forth the components of the Company's expenses for the
periods indicated:

<Table>
<Caption>
                               Nine Months Ending September 30,
                               --------------------------------
       Expenses                   2001                 2000
       --------                ----------            ----------
<S>                            <C>                   <C>
Insurance Services             $  512,696            $1,027,154
Investment Services             6,020,396             2,760,595
Corporate                       1,352,384             1,076,892
                               ----------            ----------
          Total                $7,885,476            $4,864,641
                               ==========            ==========
</Table>

Total expenses increased $3,020,835, or 62%, from 2000 to 2001. The investment
services and corporate divisions recorded expense increases of $3,259,801 and
$275,492 respectively, while the insurance services division recorded an expense
reduction of $514,458.

Insurance Services expenses decreased $514,458, or 50%, from 2000 to 2001.
Commission expense declined $466,769 to $288,495 primarily as a result of the
decrease in other life and health product revenue. Other decreases were in
insurance, payroll, postage, printing, and travel & entertainment.

Investment Services expenses increased $3,259,801, or 118%, from 2000 to 2001.
Commission expense increased $2,572,671 to $3,920,602, generally as the result
the increase in sales volume. This increase is due primarily to the new sales
representatives from the former Northstar Securities firm. Administrative
support for these new agents generally caused increases of $318,589 in payroll
expenses, $213,904 in insurance costs, $268,739 in quotation service costs,
$36,087 in licensing costs, and $93,916 in equipment rental costs. Legal and
professional fees decreased $159,412 primarily due to paying legal and
settlement payments in 2000.


Operating income (loss)

The following table sets forth the components of the Company's net income (loss)
for the periods indicated:

<Table>
<Caption>
                                Nine Months Ending September 30,
 Income (Loss) from            -----------------------------------
Continuing Operations              2001                   2000
---------------------          -----------             -----------
<S>                            <C>                     <C>
Insurance Services             $   112,747             $   248,420
Investment Services               (714,896)                202,372
Corporate                       (1,324,816)             (1,070,085)
                               -----------             -----------
          Total                $(1,926,965)            $  (619,293)
                               ===========             ===========
</Table>

Recent Developments

During 2001 the Company formed RushTrade Software Services, Inc. for the
purposes of holding the Company's intellectual property and licensing RushTrade
Direct and/or RushTrade Direct Pro, the RushTrade on-line trading software
products. The Company is currently engaged in substantive discussions with
several potential licensees, and anticipates the launch of the RushTrade Direct
Pro Level II product before December 31, 2001.

The Company is now in the process of realigning its operating divisions to
properly position the RushTrade Direct Access on-line trading sector of its
business.


                                                                              12
<PAGE>

Liquidity

The Company's requirements for normal cash expenditures, as well as costs to
further develop the proprietary software to be used in the Company's on-line
trading division, RushTrade.com, are expected to be met through cash receipts
from operations and from debt facility and equity capital raised through the
private placement of securities. Although the Company is currently exploring
various opportunities with certain potential investors, there is currently no
assurance that equity sales will be available.

Over the past several months, the Company has taken several steps to reduce
expenses and enhance cash flow. These included reducing staff levels,
consolidating office locations, and curtailing marketing programs. Also, the
Company has recently begun to work actively with its trade vendors to reduce
invoiced amounts and/or modify payment schedules on the Company's accounts
payable.

Even after these actions, however, cash flow from operations is not adequate to
meet current administrative expenses, product development, and other overhead
expenses. Additional cash infusions will be necessary to cover this shortfall,
as well as to provide for payment of current accounts payable. However, there is
no assurance that the additional cash infusions will be available, that
unanticipated expenditures will not occur, or that the necessary additional
capital will be raised.


Forward looking statements

This document includes statements that may constitute "forward-looking"
statements, usually containing the words "believe", "estimate", "project",
"expect", or similar expressions. These statements are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements inherently involve risks and uncertainties that could
cause actual results to differ materially from the forward-looking statements.
Factors that would cause or contribute to such differences include, but are not
limited to, continued acceptance of the Company's products in the marketplace,
competitive factors, changes in regulatory environments, and other risks
detailed in the Company's periodic report filings with the Securities and
Exchange Commission. By making these forward-looking statements, the Company
undertakes no obligation to update these statements for revisions or changes
after the date of this filing.


                                                                              13
<PAGE>

PART II. OTHER INFORMATION


Item 5. Other Information

On June 26, the Company received a communication from the Nasdaq Stock Market
regarding the minimum bid price of the Company's common stock. By rule, the
stock must maintain a minimum closing bid price of $1.00 per share for at least
one day within any consecutive 30-day trading period. Since the Company was not
in compliance with the Rule, it had until September 24 to regain compliance or
face possible delisting by the Nasdaq. To regain compliance with the Rule, the
closing bid price of the stock must be at least $1.00 per share for a minimum of
10 consecutive trading days.

On September 27 the Nasdaq implemented a moratorium on the minimum bid price and
market value of public float requirements for continued listing on the Nasdaq
Stock Market. This suspension applies until January 2, 2002.



                                    SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                        Rushmore Financial Group, Inc.

Dated: November 14, 2001                By /s/ Howard M. Stein
                                        ----------------------------------------
                                        Howard M. Stein
                                        Controller



                                                                              14