What is financial planning? Financial Planning is the process of ordering one’s financial wants and needs in such a way as to optimize financial freedom, independence, and security. This, in turn, should serve to enhance the quality of one’s life. Financial Planning is the means to eliminate or minimize the financial risks and threats to one’s personal property and prosperity.
The ultimate objective of Personal Financial Planning is to allow the individual to achieve one’s unique life goals. Financial planning is, at its core, entirely personal. There are certain, general rules-of-thumb and best-practices that are useful as a default pathway pointing the general direction to commonly-accepted and desired outcomes and destinations. However, personal financial planning should be customized specifically to meet the unique facts and circumstances, and wants and needs, of each person. This individualized customization is what allows financial planning to be personal.
Comprehensive Personal Financial Planning is the deliberate process of addressing every material aspect of one’s financial situation. The varied aspects of Comprehensive Personal Financial Planning include, but are not limited to: Income, Wealth Management, Budgeting, Insurance, Education, Tax Planning and Compliance, Retirement Planning, and Estate Planning.
In the United States, formal education consists of acquiring the strict technical disciplines necessary to meet the academic demands of any number of careers. Each year for a dozen or more years, students are provided with rigorous courses in Math, Science, Health, English, and other worthy academic pursuits. The focus is on obtaining a theoretical skillset that will allow one the opportunity to obtain a wage. What is almost entirely absent is any semblance of formal education surrounding the opportunities to create and preserve monetary wealth.
It isn’t enough to know how to generate a minimal amount of compensation. That is just the ticket to the game. How is one supposed to employ that compensation in such a way as to not only preserve it, but to put it to work? What are the potential pitfalls that threaten to trip-up the unwary? Once made aware of those dangers, what is one to do in order to avoid them? These are just a few of the general questions that require detailed instruction and guidance.
Effective financial planning is the key to financial independence and success. More than any other factor, the informed and disciplined exercise of key principles, individually customized, is the largest contributing factor to retaining and growing one’s assets. And yet, it isn’t routinely offered in any structured format. So it is left to the enterprising individual to seek out effective financial guidance. And that, is an enormous challenge in and of itself.
It is important to note the term Financial Advisor is generally loosely applied and only rarely practiced. In these pages, we will provide information that may serve as a general roadmap, as the foundational knowledge and bedrock principles that are required for one to make wise and educated financial decisions. It will further assist one to identify those very rare individuals who will assist them in effecting their personal financial plan; without putting their own interest ahead of their clients’.
