The Essence Of Financial Planning

A new client referred to me recently brought in a financial plan that was prepared by another firm. His company had paid for this service as a part of his benefits package. He pushed the binder across the table and said to me “Here, you may find this useful. It’s all Greek to me.” I took a quick look at the material, and was reasonably impressed. Wondering what I might be able to add to the work already done I asked, “This seems to be a pretty good plan, what are you hoping I will be able to do for you?” He sighed, indicating some frustration at having to admit that he still needed help and responded, “I’m hoping you can make this stuff simple enough so that even I can understand it. I really just want to know what I should be doing, and why. This plan is overwhelming.”

His plea for help illustrates the point that a financial plan is meaningless if it doesn’t actually do something for you.

Whether your plan is a deluxe leather bound volume of copious pages, or scribbled on the back of a napkin at lunch, it needs to do six distinct things if it is going to be effective. Here they are:

1. Establish or clarify your goals
2. Determine your present situatio

3. Map the possible route(s) to your goals
4. Convince you that your goals are achievable
5. Simplifyn6. Inspire

These simple qualities are the framework which can move you forward to financial freedom.