I am writing this article because I see far too many financial plans that have not survived the test of time. The clients met with their ‘planner’ for an hour or two and then a week later received their ‘plan’. Usually a beautiful document, full of tables, charts, and graphs artfully bound, covered, and presented. They are designed to look professional so you feel comfortable and confident with the advice you are being given. By design, this document looks like something you will keep and use for the rest of your life.
The problem with this type of ‘plan’ is that it is supposed to cover a lifetime of earning, spending, saving, investing, and insuring, but it is based on a snapshot in time. Someone has essentially taken a still photo of you and your family and made the movie of your lives. They imply they can predict the future because they know what is happening today. Real planning does not work that way.
There is a military expression that “no plan survives first contact with the enemy”. It means no matter how long and intensely you plan, no matter how many different possibilities you conceive, unexpected things will happen. This same phenomenon happens in financial planning. No matter how many different possibilities you plan for, unexpected situations will arise. It’s called ‘life’.
That reality doesn’t devalue the planning process. The military expression about the plan not surviving is somewhat tongue-in-cheek. The plan survives; just not in its original form. It must be modified in order to reach the ultimate objective – which has not changed. In fact, the true value of the plan may lie in the clear articulation of the objectives and milestones. There is significant merit in having everyone on the same page with respect to where you’re going.
Let’s get back to that professionally bound and confidence-inspiring book you were told is your financial plan. How flexible is that plan? How adaptable is that plan when you have another child? Or you lose your job? Or you have an epiphany and your goals change? Are those charts and graphs still going to get you where you want to go?
Perhaps, but are you willing to stake your family’s future on it? I wouldn’t.
That’s why I do things differently. First off, financial planning at PIM Financial Partners is a process, not an event. I can’t possibly get to know you – your goals, your values, your concerns, the areas where you’re strong, the areas where you need the most help – in a single meeting. I accomplish this by discussing your financial situation with you, devising some scenarios, gaging your response, educating you on possibilities, and helping you articulate your specific objectives. This takes a little time, usually several meetings. You use the time between those initial meetings to locate additional documents we need. I use it to research your specific situation. It is time well spent.
An adviser who doesn’t know his client gives generic advice. You can get generic advice from a website. Or a professionally bound document. You get personal advice from a person. A person who knows you. A person who has spent time with you in order to understand your goals, values, concerns, strengths, and weaknesses.
Once I know who you are and what you want we build your plan together. We are partners in this process. I provide the knowledge and technical expertise. You provide the direction. We establish the objectives, we build the base, and then we prioritize the actions to get you where you want to go. We plan for foreseeable challenges, and we build flexibility into the plan for the unforeseeable challenges.
Then we execute the plan. We take the necessary steps to achieve the objectives. At this point we meet as often as you want. My fee structure is a retainer. You are retaining my services for whenever they are needed. You can contact me whenever you need to in order to ask questions or solicit advice.
And when the unforeseeable happens we sit down again and figure out how to flex the plan. Together we determine how to work that unforeseen event into your plan and get you back on track to your financial goals. This process never stops until you no longer need money and the plan ends.
Documents, charts, and graphs can be useful. They have their place, but they are not a plan. Unfortunately, more often than not, when they are professionally bound and presented they are just a sales tool to help close the deal. They are provided to make you sufficiently comfortable to move to the next phase – purchasing the financial products recommended in your document. It’s not a plan. It’s a brochure.
At PIM Financial Partners I don’t sell financial products. I sell financial planning. We may put together a binder of information for you to reference in the future, but that isn’t your financial plan. Your financial plan is a living, changing, growing entity we develop, nurture, and modify over a lifetime.
If you are ready for a new experience in financial planning, give me a call today.