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Wealth Planning is For Everyone


Wealth Planning is For Everyone

The best wealth management plan has nothing to do with “outside forces” beyond your control, but rather everything to do with what’s most important to you.  Instead of feeling overwhelmed by the supposed complexity surrounding financial decisions, a straightforward wealth management plan can bring clarity and peace of mind about which strategies will work best for your particular situation.

Behind the scenes, a wealth management plan does involve number crunching and various strategies to implement.  Up front, it should summarize this data into a document that represents;

  1. Three to four factors that are the most important to you.
  2. Action items that need to get done.
  3. A reminder of why you are doing them.

Similar to stock markets, no one can predict what will happen in the future.  Life events such as a new baby, death in the family, or a medical issue can derail the best-laid plans.  Therefore, it is critical to not only be flexible when it comes to wealth planning but also in life planning as well.

By doing the tedious but critical everyday steps that lead to a financially healthy life such as maintaining a high savings rate, paying down debt, avoiding credit card debt, and preserving a high credit score, you can have the financial and personal flexibility you may need when life throws you a curveball.

Here are some of the critical aspects to keep top of mind when managing through an unexpected planning situation;

  • Wealth planning is an ongoing process.  As your life evolves, so to must your wealth plans.  What may have been a focus in your 20's and 30's, won't likely be your focus in your 40's and 50's.  Stay nimble and don't hold tightly to the plans of today which could negatively impact your future.
  • Goals can and will take a back seat to priorities.  I could never have imagined having four kids let alone triplets.  Goals and plans that I had pre-kids suddenly changed overnight.  My wife Theresa and I had to focus on our immediate priorities which were many.  This does not mean that you should kill your goals if they still fit within the life that you ultimately want.  You may have to delay them a bit to focus on what you must do today.
  • You cannot prepare for everything, and that is okay.  Have you ever been through a job change that wasn’t by choice?  You may not have had any time to prepare for a change of that magnitude.  However, everyone that I know of that has gone through a situation such as this has bounced back stronger than before.  With a healthy mind, spirit, and reliable support system just about any situation can be overcome.

Wealth Planning Simplified

Creating a wealth management plan is one of the best ways of giving yourself something that everyone wants more of, time.  Most of our money decisions are driven by a desire to feel happy, safe, and secure.  A wealth management plan should not be focused on money alone.  There should be just as much emphasis on the following three critical non-monetary factors;

1.      Time, the calendar and the checkbook never lie. The way we spend our money and our time often say something about what we value.

2.      Skills, while compounding and a disciplined savings plan will help your assets grow, human capital will always be your best and most significant investment. 

3.      Energy, when we think about money only regarding dollars and cents, we risk depleting our energy due to factors beyond your control.

Before you can plan, you must know why you are planning.  Realize the connection between tangible things like the money you make and the intangible things like how great it feels to be there when your daughter scores her first goal.  Knowing your values can help eliminate distractions and help you focus on what’s most important.

Famous investor George Soros once said, “there is no shame in being wrong, only failing to correct our mistakes.”  Don’t use the mistakes you have made in the past as an excuse to deny yourself what’s important.  Disappointments often come when people are so focused on outcomes that they miss out on in life.  Planning usually involves letting go of the following;

  1. Expectations about the future, don’t turn a guess into an expectation.
  2. Outcomes we cannot control.
  3. Need to measure ourselves against others.

If we want to take control of our finances, we must also take responsibility for our spending and know that nothing will change unless we change our behavior.  Wealth planning is not just about numbers it is a tool for awareness. Its purpose is not to punish ourselves for spending money; it is to become acutely aware of how we are spending our money so that we have enough for the things that matter most.

Don’t deny yourself the things that help keep you healthy, happy, and sane today.  Spending large sums of money on something, even items that you would consider a luxury, doesn’t necessarily mean you are making a wrong financial decision. It may well be the best decision for you. However, only if it is in line with your goals and values.

The more we can make money decisions that support our values the less likely we will regret those decisions, even if they are expensive choices.

The Value in Financial Planning

At its core, wealth management is a process that encompasses building a plan to achieve your financial and lifestyle goals.  Below are six fundamental value propositions that people should expect from a wealth management plan:

  • Organization; bring order to your financial life by taking a holistic process-oriented approach;
  • Accountability; follow through on your financial commitments by developing and prioritizing your financial and life goals, guiding you through the critical steps that you need to take to succeed;
  • Objectivity; avoid emotionally driven decisions in critical financial matters by being able to consult with you at crucial moments with the necessary data to ensure that you have all of the right information to make informed decisions;
  • Proactivity; anticipate your life transitions and to be financially prepared for them by regularly assessing any potential evolutions that might be coming with an action plan to address and manage changes ahead of time;
  • Education; understand the specific knowledge and the necessary resources to facilitate your decisions;

Our personal lives are so intertwined with our financial lives.  Having a reliable support system whether it is a spouse, partner, a close friend, or advisor can be critical to staying on the right path both mentally and financially when flexibility is required the most.

What I have found in helping people over the past 20 years, is that clients put the most value and emphasis on having peace of mind.  People want to know that they have someone on their side or team who is always looking out for their best interest which can be relied upon in a crisis or time of need.  Also, people want someone for whom they can trust and place their confidence in.  Helping to provide clients with peace of mind, is the most rewarding part of what I do at TAMMA.

For questions about any wealth planning and asset management topics, do not hesitate to contact me to find out what options may be best for your own personal situation. 

Paul Fenner, CFP®, ChFC

President, TAMMA Capital

Registered Investment Advisor

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