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It’s summer and vacations are front and center. Vacations require effort and planning. The same goes for your financial journey. The amount of effort you make to focus on your financial aspirations and goals has a lot to do with your long-term success.
What Makes a Journey?
A journey, whether it’s a summer vacation or a financial planning expedition, entails a series of steps. These steps start with ideas and proceed to implementing these ideas by making commitments of time, resources, and mental energy.
Inevitably, your journey won’t unfold exactly as you have planned. Any number of things can change, and you have to adjust your plans. Journeys, and the planning that precedes them, needs to be dynamic.
The point of any journey is to transport you from where you are today to a different place, someplace that you want to experience. Perhaps it’s a place you’ve never been before or maybe somewhere you want to go again.
The Journey is as Important as the Destination
In personal financial planning, the journey itself can be as important as the ultimate destination. At each stage of planning, you’re asked to assemble choices where you make decisions to go in one direction and simultaneously decide not to go in another.
Maybe you want to retire early, but you also want a second home. Both of these goals require a substantial commitment of financial resources. Likely, you’ll have to decide which one of these aspirations is more important. You probably can’t do both.
Be Decisive in Where You Want to Go
These tradeoff decisions become the foundation of your financial planning journey. Your trip will be more enjoyable and satisfying if you are crystal clear about where you want to go. Saying your primary financial goal is to have ‘more money’ is the equivalent of saying you want to vacation somewhere that’s warm. It’s simply too vague.
It may seem subtle, but one of the most critical components of planning for something is to make it concrete, not abstract. Your destination must be real, not imagined.
Sometimes, journeys are solitary, but usually they involve others. Who do you want to accompany you on your financial planning journey?
Accepting Change
All types of journeys involve change. Changing your physical surroundings; changing your financial situation. The commonality is change.
The problem is that humans are wired to resist change. It’s easy to revert to the status quo and let inertia guide you. Decisions that you make as well as decisions that you don’t make form your path.
We routinely have planning review meetings with clients where a laundry list of still unfulfilled action steps have been carried over from previous meetings. Ultimately, when you decide not to take action, you are in essence setting an anchor for progress toward that goal.
Your actions are your actions; your goals are your goals. Investment returns, the economy, and politics aren’t responsible for your progress or lack of progress. You bear the burden of responsibility for the ultimate outcome.
Journeys can be exciting and stressful simultaneously. Every journey is unique. Your financial planning journey should be built around what you value most. The people you love, the activities you cherish, and those you want to protect. Start there. Ready for a real conversation?
Related: Your Investments Don’t Need to be Complex to Succeed