The Financial Planning Process*
Comprehensive Financial planning: What It Is, Why It Matters
"Your approach to building wealth should be built around your goals & values." - D.W. Eisenhower
Just what is “comprehensive financial planning?”
I’m engaging clients in a new way in an effort to understand what matters to them most. Financial life management (i.e., One Best Financial Life ®) helps people identify the role of money in their lives. Developed and tested for over 10 years, it is a client experience process includes digital tools which help people make choices that are right for them – beyond just investing.
I have new planning tools based on three client questions:
• What do you want your life to be like?
• Do you have the resources to live the life you want?
• Are you prepared for life surprises?
By incorporating clients in the financial planning process, you help shape a plan that reflects what matters to you most – with outcomes and measures of success you can understand. This process helps clients get Clarity, Confidence, and Control.
Comprehensive financial planning is about building wealth through a process, not a product.
Financial products are everywhere, and simply putting money into an investment is not a gateway to getting rich, nor a solution to your financial issues.
Comprehensive financial planning is holistic.
It is about more than “money”. A comprehensive financial plan is not only built around your goals, but also around your core values. What matters most to you in life? How does your wealth relate to that? What should your wealth help you accomplish? What could it accomplish for others?
Comprehensive financial planning considers the entirety of your financial life.
Your assets, your liabilities, your taxes, your income, your business – these aspects of your financial life are never isolated from each other. Occasionally or frequently, they interrelate. Comprehensive financial planning recognizes this interrelation and takes a systematic, integrated approach toward improving your financial situation.
Comprehensive financial planning is long-range.
It presents a strategy for the accumulation, maintenance and eventual distribution of your wealth, in a written plan to be implemented and fine-tuned over time.
What makes this kind of planning so necessary?
If you aim to build and preserve wealth, you must play “defense” as well as “offense.” Too many people see building wealth only in terms of investing – you invest, you “make money,” and that is how you become rich.
That is only a small part of the story. The rich carefully plan to minimize their taxes and debts, and adjust their wealth accumulation and wealth preservation tactics in accordance with their personal risk tolerance and changing market climates.
Basing decisions on a plan prevents destructive behaviors when markets turn unstable.
Impulsive decision-making is what leads many investors to buy high and sell low. Buying and selling in reaction to short-term volatility is a day trading mentality. On the whole, investors lose ground by buying and selling too actively. The Boston-based investment research firm Dalbar found that from 1994-2013, the average retail investor earned 5% a year compared to the 9% average return for U.S. equities – and chasing the return would be a major reason for that difference. A comprehensive financial plan – and its long-range vision – helps to discourage this sort of behavior. At the same time, the plan – and the financial professional(s) who helped create it – can encourage the investor to stay the course.1
A comprehensive financial plan is a collaboration & results in an ongoing relationship.
Since the plan is goal-based and values-rooted, both the investor and the financial professional involved have spent considerable time on its articulation. There are shared responsibilities between them. Trust strengthens as they live up to and follow through on those responsibilities. That continuing engagement promotes commitment and a view of success.
Think of a comprehensive financial plan as your compass.
Accordingly, the financial professional who works with you to craft and refine the plan can serve as your navigator on the journey toward your goals.
The plan provides not only direction, but also an integrated strategy to try and better your overall financial life over time. As the years go by, this approach may do more than “make money” for you – it may help you to build and retain lifelong wealth.
If interested, I would like to schedule a no cost, no obligation meeting to discuss how I serve people by helping them live their One Best Financial Life. Be assured that I won’t waste your time with a gimmicky sales pitch! If you decide my services make a good connection with you and your needs – great! I just want you to know that I’ll respect your time and I don’t pressure anyone.
This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of United Planners Financial Services. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Neither United Planners nor its financial professionals render legal or tax advice. Please seek such advice from your own tax and legal counsel. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
1 - fool.com/investing/general/2015/03/22/3-common-mistakes-that-cost-investors-dearly.aspx [3/22/15]
*Don Purcell is an Investment Advisor Representative offering Financial Planning and Investment Advisory services through Stewardship Advisory Group, LLC; an SEC Registered Investment Advisor. *Legacy Coaching services are offered through Stewardship Legacy Coaching, LLC. Securities are offered through United Planners Financial Services, a Limited Partnership, Member FINRA, SIPC.- Stewardship Advisory Group, LLC and Stewardship Legacy Coaching, LLC are not affiliated with United Planners Financial Services.