Financial Planning is a process that can have a magnificent, meaningful impact on your quality of life. Some people equate financial planning with getting an adequate rate of return on your RRSP. That’s fine as far as it goes, but it’s and inadequate definition of financial planning.
Financial Planning is a six step process that involves examining a client’s position, setting some objectives, identifying obstacles, designing a plan, implementing the plan, and monitoring the plan to make sure you are on track. Each of these steps is a necessary part to maximize the likelihood of obtaining your goals.
Is it worth it? Absolutely. Nick Murray is a speaker and author who has had a large part in shaping my thinking on the Great Goals in Life.
What is a Great Goal? Here are some examples. Being financially stable so you can enjoy time with your family. Having a retirement income that you can’t outlive. Ensuring your family will be taken care of if your are hurt or sick or killed. Leaving a legacy to your favorite charity. Helping with your grandchildren’s education, or caring for your aged parents. Ensuring the multigenerational transfer of wealth.
Financial Planning is a clearly defined process that moves you toward your objectives. Having a plan and then implementing it is critical if you want to accomplish your objectives. Sometimes people know what they want, but have no idea how to make it happen. Or they know what to do, but never get around to doing it.
Lately one of my personal objectives was to improve my physical fitness. The thing is, I have wanted to do this for quite a while. Unfortunately, the job wasn’t getting done. I wasn’t moving any closer to my goal of improving my physical fitness until this past weekend when I resumed running after a too-long hiatus.
I had a goal- to get in better shape. But I wasn’t really doing anything about it. It’s the same with financial goals. Without implementation, the plan is useless.
What’s important about money to you? What do you want to accomplish in life?
What are you doing about it?
Financial planning goes beyond trying to get eight per cent from your RRSP.
Financial Planning is about working towards your personal Great Goal.
Financial Planning sometimes takes some time and effort, but Great Goals are worth it.