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Financial Planners and The One Page Financial Plan


 

 

I have just finished reading Carl Richards’ book “The One Page Financial Plan”. Since I have prepared and presented numerous financial plans over the years, I wondered how in the world Carl could deliver a one page financial plan. The best I ever achieved was a four page summary with 50 pages of backup.

 

Richards is a very smart financial advisor/financial planner and has achieved a bit of fame in recent years with his column in the New York Times and his very clever Behavior Gap Sketches. At first I thought, maybe he just put three to five of his sketches on a page based on the path an investor needed to follow.

 

That proved not to be true but his approach is worth study. In reading a number of Carl’s blogs and his first book, “The Behavior Gap” I was very aware of his use of questions and probing when meeting with prospects and clients. His key question is “Why is money important to me?”.  It follows that if someone meets with an investment advisor, the discussion of money will occur. Most financial advisors never ask the question and investors for the most part, never think about it. However, the answer to it is paramount to developing a financial plan that has a chance of succeeding.

 

Mark Matson asks a similar question in a different way in his book “Main Street Money”.   Mark focuses on investing and believes that in order to be a comfortable investor, you must be able to answer “The 20 Must Answer Questions”. The first question is “Have you discovered your true purpose of money, that which is more important than money itself”?

 

Discussions about money are not comfortable for many people. We even shy away from thinking about the subject let alone talk about it with a stranger. Nonetheless, the answer to either question is critical. And one word answers are not sufficient. For example, my answer to the question is Freedom. I even have a placque that states the answer.  Digging deeper, it is the freedom to take off for a week or two or three of four and not have to worry about the expense involved or that my business will suffer in my absence.

 

So the first item on Carl’s one page financial plan is the answer to THE QUESTION.

 

The second question involves activity. Where do you spend your time and money?  If you are spending your time and money on that which matches why the money is important to you, then you can write down your goals.

 

The goal does not have to be your ultimate goal of perhaps sailing around the world. It can be a short term goal and a midterm goal both leading to the ultimate goal.

 

Can you achieve your financial plan without a financial planner or an investment advisor? The answer is yes but the likely hood is no. Why not? Too many distractions! Too many twists and turns in the roads we travel. Find a financial advisor who will help you answer the question as to why money is important to you.

 

The information provided is not to be considered as investment advice, tax or legal advice. All investment involves risk and investment in any security should not be entered into before reading the prospectus. All economic and performance data is historical and is taken from what is considered reliable sources but we do not make any guarantees as to its absolute and complete accuracy. Past performance is no guarantee of future results. Bill Mullen is the managing member of Mullennium Finance LLC. Investment Advisory Service is offered through Mullennium Finance LLC, a Utah Licensed Investment Advisor. Bill Mullen is known as an investment advisor and a Certified Financial Planner Practitioner™. His firm is an independent fee-only entity providing comprehensive financial planning for small businesses and individuals as well as investment planning, portfolio design and portfolio management. Mullennium Finance LLC is located in Park City UT and has clients in Park City, Heber City and Midway UT as well as Salt Lake City &Southern California.

 

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Comment   |  4 years, 11 months ago from Snyderville, UT