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Financial Organization

Financial Organization

Financial Organization

As professionals and business owners with competing priorities and demands, financial organization and overall planning can feel overwhelming.

From daily expenses, to buying a new car, getting married, buying a home, having kids, saving for college, growing your business, saving toward retirement, taxes, charitable giving, the list goes on! While it may seem like financial planning is yet another task that you’re not ready to take on, it could be the one that eases the financial burden of life’s other demands.

By investing early and starting conversations to educate yourself on financial planning, you can avoid mistakes and behaviors that will cost you money down the line when you may need it most.

Financial Mistakes

Through my experience, I have found that there are two main mistakes people make when it comes to their finances: neglect, and impulsiveness.

Simply put, these mean avoiding the financial process all together or doing anything just to get it over with.

However, there are simple ways to avoid these traps.

Creating a Strategy

We “in the biz” call the financial organization process “creating an investment policy statement”, or documenting objectives and next steps. In the construction of your financial “house,” it is the equivalent of laying your foundation.

As part of your investment strategy, we want to determine acceptable investment risk levels. We want to return expectations given your time horizon, tax situation, liquidity needs and any unique or legal circumstances.

We in "the biz" scene from The Break Up


Importance of Writing Down your Plans

Dr. Gail Matthews, a psychology professor at the Dominican University in California, actually conducted a study that supports the idea that you become significantly more likely to achieve goals after writing them down. This is not an abnormal concept.

In fact, as financial advisors, the most heartening part of the study was that the most successful group not only wrote their goals down, but was asked to articulate the goals, track them and then report on them. Literally exactly what we help clients do as advisors!

Identify Action Items

Once you have a clear investment strategy, it’s time to document and clearly identify action items which will help you in your journey to financial organization.

Common questions to contemplate include:

Are you going to dollar cost average into the market? Make annual IRA contributions? Increase your 401k percentage each year? How much will you contribute toward the 529 (college) plans?

Get this all written down so that you can set clear goals, create next steps, track progress and hold yourself accountable for your financial organization and overall success.

Results of Financial Organization

This exercise and strategy will prevent you from making impulsive decisions in search of returns that conflict with your written goals. Life has a crazy way of changing quickly on us. Revisiting your plan at least once a year will ensure you stay on track to achieve your objectives.

Considering making a change to your investments? Pause… Take the opportunity to review your plan.  Ask yourself if the change you plan on making aligns with your written objectives.

You will avoid so many detrimental investment decisions by this simple action.

Contact us for help with your Financial Organization!

Having a tangible plan that reminds you why you are invested a certain way will go a long way in preventing the common actions, or inactions, that lead to missed goals and opportunities.

Talk to us today to create a plan and take control of your financial future.

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