Planning Awareness

People think financial planning is complicated and hard to understand.  They get the worst of it when they believe that.  Planning is reasonably easy.  Execution is harder.  Do not conflate the two.  You don’t have to do everything yourself.

People believe it is complicated because some advisors make it seem so.  It is not and people can easily come to grips both with planning and advisors. The method is to break planning into its constituent parts.

The first necessary recognition is the client is the planner and everyone is a helper. Advisors are tools to use for you the planner to achieve your goals goals with the resources available to you. 

Robert Kraft does not have to go on the field for the New England Patriots to be successful.  He can hire helpers.  Tom Brady and Bill Belichick are that. So it is with you. Sit in the owners box, define the purpose and supply resources. Let the helpers implement.

The plan owner must design the strategy for the financial team.  The “W” questions. What, what with, when, who with, where,  are never the responsibility of the advisor. Why will motivate and the “why not something else” will clarify. Strategy is never complex.  It is simple even.  The more simple the better.

Advisors are technicians.  They deal with methods, tools and techniques. These are complicated and often changing. The planners advantage is that they need not know how they work only that they do. Their entire involvement is to ensure the recommended tool matches the need from the strategic plan. It is always related to a strategic template. Ideally it is the answer to a question. “Given my overall plan, my resource limitations and my priorities, which we have discussed, why is this a good product to accomplish what I want?”

The third phase of planning is logistics or implementation.  Again some are very detaily and complicated.  You need know little about that.

As the planner, your failing will come under two conditions.

  1. You do not have a clear direction with specific ideas and known resources. Without that, any product can be a possible solution for you. If you do not organize a strategy, someone else will do it for you and that may be more closely related to their personal strategy than to yours.
  2. You have a reasonable strategic plan and try to do the tactical things on your own. There is almost no chance you can ever be good at this aspect.  The field is quite wide and each part of it has serious complexity. I have seen people who would not do their own tax return try to implement their own financial plan. Knowing about economics, the law, taxation, risk management, debt management and investing is more than a full time job for a professional in any one of the fields. No amateur will get good enough at it. The price of do-it-yourself is a lot of time, frustration and some avoidable mistakes. Fees tend to be cheaper.

Hire someone who can help manage you. Emotions are deadly.  So are contradictions and important things you did not know about. Robert Kraft pays millions to Brady and Belichick because he can never be as good at what they do as they are. He chooses to spend his time doing things only he is best at. You can see the Patriots front office support group here. I’ll bet every one of them is better at what they do for the team than Mr. Kraft would be.

You should learn to delegate the complicated things and be sure you know your strategic goals. Then it is simple.

Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario.  In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.

Please be in touch if I can help you.  866-285-7772

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