Financial planning is nearly impossible to get right if you begin poorly.
There can be several right places to start, but none of them begins with the the idea of “How.” All of the right places start with a “W” question. Usually that question looks like, “What do I want?” or maybe, “What am I trying to do?”
After the whats have been established other “W” questions appear. When? Where? Who with? What with? What if?
Why helps establish priorities and standards.
People who start with “How?” are automatically picking up another’s idea of the “W” questions. It is very hard to sustain a financial plan over the long time it will take to flourish if you do not know about and agree with the fundamental idea behind it.
Beginning with “W” sometimes does not work either. People get into trouble when they choose a What that is not really them. Be careful that you choose your real what, not some what that you think you should have. There is much advertising and other incitements to pick what others want. That’s fine if it is also what you want.
You must establish goals that would work for you, and maybe for you alone.
It is difficult enough to achieve the goals that matter deeply to you. Pursuing goals that are not truly important for you is debilitating in terms of both time and money. Try to avoid them or adjust as soon as you realize they are not reflecting your deep needs. Proverb, “If you find yourself on the wrong road, turn back.”
Your time frame and your resources will define the limits to your goals. A goal that does not fit both is clearly one that comes from outside your true being or from a dream that will always remain a dream. Learn quickly about the things that you want but cannot have, and again, turn back.
The great English philosophers, Mick Jagger and Keith Richards, have captured the idea:
“You can’t always get what you want
But if you try sometime you find
You get what you need”
Sometimes an advisor can help you sort out your goals. They can also help establish priorities, find efficient methods and help you find resources. When things go astray, as they nearly always do, their objectivity and experience can help you maintain your resolve.
Objectivity is a hard one for the do-it-yourself crowd. Most of us need to go outside ourselves to get objectivity.
Don Shaughnessy is a retired partner in an international public accounting firm and is presently with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario.