Let Your Life Goals Drive Your Financial Strategies

~ Herb White, MBA, CFP ~

Many people take a willy-nilly approach to their finances. Instead of viewing their expenditures and their investments as part and parcel of their overall goals and aspirations in life, they view them as separate, unrelated actions: Saving for a child’s college education. Investing for retirement. Managing their taxes. Upgrading to a larger home. This approach focuses on what things cost and whether they are affordable, rather than on how they tie in to their personal life goals.

Why is it important to consider your life goals before making financial decisions and purchases? From a financial standpoint, this approach helps you prioritize and stick with your goals in life as well as avoid any financial or investment decisions that could be misguided.

On the other hand, an approach that focuses only on what you need or want to buy rather than comprehensive personal financial planning can mean that you can end up with numerous advisors, each considering only one of your goals. For instance, an insurance agent, a tax professional, an estate planning attorney, a retirement specialistÑall will help you with a specific issue but likely do not consider the bigger issue, your life goals.

Instead of receiving wise help that takes into account all the aspects of your finances and how those finances relate to your goals, you can end up with individual advice from professionals that can lead to redundancy in your plans. It also can lead to risks that could have been avoided, as well as investments that don’t work for you and policies and accounts that overlook key financial planning areas.

A smarter option is to rely on one financial professional who understands your goals and has your interests at heart. Here’s an analogy. Let’s say you are President of the United States and are planning a state dinner with many guests. Wisely you select one supervisor to coordinate all the plans and preparations. That person then asks other individuals who have specific expertise to provide the food, beverages, entertainment, invitations, etc. Instead of having numerous supervisors, you have just one and the event is a huge success.

If the President had ten supervisors instead of one, imagine what might happen. Perhaps the entertainment would end up being a rag-time band rather than a symphony and pizza would be served rather than steak. Of course, this wouldn’t happen, but something similar happens all the time to consumers with their finances when the big picture their life goals isn’t considered. Often you can end up with multiple and even redundant investment strategies that can be confusing, a waste of time and money, and can even increase your level of risk.

What if you viewed all your significant expenditures in another way?
What if, instead of making a purchase based simply on want, or because there is a good sale, you considered the purchase in light of your overall goals? If retirement savings is one of your goals, for instance, you might ask yourself if the purchase will impact those retirement plans. Taking a holistic approach to your finances like this can help guide you in making good financial decisions that can also be more meaningful to you.

Letting your long-term life goals and values drive your financial strategies means you first take a big-picture look at what your goals and aspirations are. Let those aspirations take first priority. Then get help from one advisor who is skilled in comprehensive financial planning this is someone who will spend the time to get to know you, and can coordinate your needs and provide you with appropriate strategies based on your personal situation.

Herb White

Herb White

Tune in to “America’s Wealth Management Show” sponsored locally
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Provided by courtesy of Herb White, MBA, CFP©, a CERTIFIED FINANCIAL PLANNERª with Life Certain Wealth Strategies, 8400 E Prentice Ave, #715 Greenwood Village, Colorado, www.lifecertain.com, (303) 793-3999. Securities and investment advisory services offered through Woodbury Financial Services, Inc. Member FINRA, SIPC and Registered Investment Advisor. Life Certain Wealth Strategies and Woodbury Financial Services are not affiliated entities.