Do you have a clearly written financial plan?  


We ask this question when meeting with a new prospective client for the first time, and the answers we get are typically very mixed.  


Some folks feel they have an adequate plan, others don’t, but the real question is how you define a “plan” in the first place?  


From our experience, the conventional approach to financial planning only helps get you halfway home.


What most people perceive as a complete plan usually includes financial projections and reports, charts and graphs, and perhaps a spreadsheet or two for good measure.   And those are all useful tools that help to inform better decision making, but do they constitute a true plan?  


  • Does it take into account your most important relationships, your personal passions and interests, and the activities that are most important to you?  
  • Does it consider your personal family value system?  The principles and family tenants that you stand on and wish to preserve for future generations?
  • And does it create a clear alignment and connection between those things that are most important to you and your financial resources?


Almost exclusively, we find the answer to these questions is “no” or “I’m not sure” (which inevitably means, no).


You have to start by getting clear on these questions.  They’re often difficult to tackle, because they take time, and require thoughtful introspection in order to drill down to the deeper more meaningful answers.  


Not always fun in the moment – but incredibly valuable and impactful over the long haul…


This fact alone keeps a lot of financial professionals from wanting to get anywhere near these types of conversations.  They end up feeling a little too personal, and can often distract from the conventional financial planning process that we’re all taught early in our careers…so better to avoid them altogether and keep the discussion focused on money.


But pretending these issues aren’t important or aren’t relevant to the financial planning conversation, is not only short-sighted, it’s also irresponsible.


If you aren’t clear about the specific purpose attached to what you’re doing, or why you’re doing it, how will you measure success?  How will you benchmark your progress, and know when to course-correct when you get off track? 


It’s a failure at this point in the process that causes so many people to experience frustration, confusion, doubt, and discouragement when it comes to money and finance.  


We’re taught financial principles such as work hard, save money, invest in the stock market, stay the course, live within your means, don’t put all your eggs in one basket…etc., etc., etc…


And those adages might not be wrong, but do they offer a dependable outcome that makes sense to you?  When left to figure things out for ourselves, most of us will default to the things that are most familiar and comfortable.  


The challenge that this presents is that we’re conditioned to focus on the wrong things, and in the process, fail to establish a system that measures the personal progress that actually matters to us specifically.


We begin to measure success or failure by percentage points on statements, rather than understanding how those percentage points translate to things that are important to you.  Then when you find yourself in a conversation with a peer, who wants to tell you how well their investments have done, comparison bias takes over, and we begin to question what we’re doing wrong.  


The problem is that this conversation has no consideration for the amount of risk that person is taking, what they’re trying to accomplish – or how much they previously lost in order to achieve the gain they’re so eager to brag about it.  Bottom line is, it has nothing to do with you, yet we anchor our expectations to these kinds of interactions and experiences and end up chasing a constantly moving target. And when there’s no real strategy or intent behind why you’ve made the decisions you’ve made with your money, it’s no wonder that you might find yourself frustrated and discouraged when things don’t seem to perform as you expected.


So what can you do about it?  


If you’re going to make meaningful progress in your life, personally, professionally, or otherwise, you have to start by getting clear about your target.  


As the saying goes, “if you don’t know where you’re going, any path will get you there.”  


So what’s your destination?  What do you want your time left here to include?  What do you want to do? Where do you want to go, and who do you want to surround yourself with?  What contributions do you want to make to the world? What do you want your lasting imprint to be after you’re gone?


When you think of your financial plan, as it exists today, are you confident that it’s aligned with those priorities and is designed to help you deliver that outcome?


Here are a few plan-specific questions to help get you started:


  • Do you know how much life will cost after you quit working?
  • Do you know how much you need to be saving and earning on your investments in order to help support that lifestyle in the future?
  • Do you know how much you’ll be able to safely spend from your assets without running out of money?
  • Do you know how much money you’d lose if we experienced a market loss as we did in 2000-2002, and again in 2008 and 2009?  
  • Do you know how long it will take you to recover from a significant loss like that?
  • Do you know how much, in dollars and cents, you’re paying in fees and expenses for your current portfolio?  Not just the fees that are disclosed on your annual investment statement, but the hidden costs that might be quietly eating away at your hard-earned money?
  • Do you know how much a potential long term care stay might cost you and your spouse, or how your income and tax plan will be affected when the first of you pass away?
  • Have you accounted for how much income you have to replace in that event?  Or how much your tax bill will increase?
  • Do you know how much you’ll pay in income taxes over the course of your retirement?
  • Do you know how much money will be left over to your family and the charitable interests you have after you’re gone?


All of these are critical questions that must be addressed, and without clear answers to every one of them, you have blind spots in your current plan that can cost you significant time and money as you move forward.


A true plan should focus on aligning the things that are most important to you with your financial resources.


If you want to review the state of your current plan, or would like to begin laying out your personal financial blueprint, we invite you to take advantage of a complimentary strategy call.


On this call, we’ll work with you to assess each of the critical elements of a complete financial plan, and help to address any pressing issues that you might have on your mind. 


To reserve 30 minutes with our team, you can access our calendar here.