Wealth Management & Financial Planning

Wealth Management & Financial Planning

Unlocking Your Financial Vision: The Importance of Goal Setting

What is your Financial Vision? Have you ever thought about it?

Don’t worry. If you are like most people, the answer is usually, “Not really.” If you are married, it is also unlikely that both of you have discussed and articulated your shared goals. Typically, assumptions and guesswork lead to the conclusion, “I think we’re pretty well aligned on that. Right, dear?” As a financial planner it is my job to help you consider these types of questions to help you understand if you are on track to achieve the answers.

In a marriage, money can be a major source of frustration and friction. One spouse is likely to be more of a saver and the other more of a spender. It is important to be transparent with each other and set reasonable expectations for both saving and spending. It is very easy to procrastinate beginning the task of sitting down and considering the long-term future.

An oft quoted truism about planning states, “Having no plan is a plan to fail.” This is very true in financial planning. We all have unique goals and circumstances, and we can increase our chances for financial success when we take the time and make the effort to plan carefully.

Careful planning includes determining answers for the following critical questions.
     • When could I retire comfortably? If I worked an extra year, how much would that help?
     • What will I do in My Life After Work?
            o Vacation?
            o Pick up a hobby?
            o Visit Family?
            o Volunteer?
            o Finally relax, and slow down?

Further questions to consider:
     • Who am I outside of my identity at work?
     • Will I lose my sense of pride, purpose, or prestige that I had while working?

As a financial advisor, I really enjoy being part of the conversation with these types of questions. Once an answer is determined, money is simply the tool we use to achieve the desired outcome. Many of your answers will have both financial and non-financial reasoning, and it’s my job to parse out and balance those competing priorities when making recommendations.

I’ll close with a story. I once met with a married couple in their forties. They expected that their two children would follow in their footsteps and attend college at their alma mater. I asked if they planned to pay for their children’s college. One parent said, “I had to work my way through college, and so my kids should as well.” The other parent said, “My parents paid for my college, and it was a tremendous blessing to me that I am so grateful for. I have no student loans.”

Neither parent was right or wrong in this scenario, but this discussion uncovered an important question that needed to be answered. One factor to consider in determining your answer is your willingness to sacrifice your personal goals for Your Life After Work. If paying for your children’s college means you have to work five years longer than anticipated, I want to make sure that is a tradeoff you are willing and able to make.

“Having no plan is a plan to fail.” Clearly, deciding how to pay future college costs is just one example of an important conversation that occurs when meeting with a financial planner. Consider which of the critical questions you still need to answer, and avail yourself of the services of a competent financial planner to guide you through the process. The time to act is now.

Financial Enhancement Group is an SEC Registered Investment Advisor.

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