Financial Planning is About Trade-offs

Over your lifetime you will make thousands of decisions involving different trade-offs that will greatly impact your finances. Proper financial planning will allow you to make the most of your money and maximize your happiness by helping you to achieve the goals that are most important to you. There’s no magic wand or pot of gold at the end of the rainbow—and the reality is, you will have to make some hard choices. Financial planning is all about balance. Ultimately, you will weigh your choices and their likely consequences to make your decisions and forge your own path. A financial planner can help you see consequences you might not have envisioned and can guide you through unforeseen obstacles as you look at your options.

Your goals also play a large role in your decision. If you are saving for a car, you will want to save money outside of your retirement plans to meet that goal, in addition to whatever money you are saving for retirement. Maybe you’re putting kids or grandkids through college; maybe you’ve always wanted to take a cruise to Alaska. Determining how you will allocate your money to achieve different goals is a large part of financial planning. I know talking about your goals and personal factors might sound a little too “touchy-feely,” but how you feel about money, work, saving, and spending all goes into your decisions. The purpose of financial planning is to manage your money to achieve your goals, which are largely driven by your emotions and feelings. Again, here an independent advisor can help you decide which of those emotions are rational and which impulses might be pushing you toward unwise decisions.