Many people think of financial planning as being solely about investments. It encompasses much more. It includes granular details of investing, spending and money management. But broader topics of estate planning, tax planning, and risk assessment/management are also included. To be clear, sound financial planning must start with the big picture. Where are you going? Unless your financial plan addresses that question, it will be more of a generic commentary than a focused strategy.
Much of the financial planning industry only skims the surface of truly comprehensive financial planning. Sometimes it seems as if planners only conduct such questioning because their firms require it prior to moving forward with the actual investments. In my view, the plan is the exciting part, and an essential part of the process. When the plan is designed correctly, progressing to the investment component flows naturally. Knowing how much investment risk is needed to accomplish the goals that you have set forth makes it easier to progress.
The only way to effectively begin a working relationship is to first gain a complete understanding of what the client wants out of life. A surprisingly large number of people simply have not slowed down long enough to ponder the matter. If they have an idea of what they would like to accomplish, it might be out of line with the resources currently at their disposal. The risk of not knowing is a significant problem that gets in the way of retirement success.
**Excerpt From “Financial Stability For Life”, by Daniel E. Butler, CFP®
Any opinions are those of Butler Financial, LTD. and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation.
