As full time financial planners, our Wealth Managers spend a lot of time getting to know the daily struggles and triumphs of their clients, and have picked up a number of helpful life lessons along the way.
Here are our top seven:
1. Its’ not about the money… it’s what the money allows you to do.
Mindy Gasthalter: Money is a tool. It gives us freedom and flexibility and allows us to make choices. For example, money allows us to make gifts to our children while we are alive to see them enjoy it, rather than wait until we are no longer here. Money allows us to make decisions about work, and to move on to another job if the one we have no longer suits us. We can help our grandchildren go to college, or we can make a difference in the world by giving to charities and organizations that are important to us.
Money gives us freedom and peace of mind, but it is not an end in itself.
2. Small changes result in big gains.
Barbara Ristow: There’s one financial planning concept that I find myself using again and again in everyday life: Increasing savings by a small amount can have a dramatic impact on your longterm growth.
I use that same idea when setting my running goals for the year. My tracking spreadsheet shows the total miles I plan to run, broken down by week and day. When I increase my total miles for the year, I look at the incremental increase required for each run to see if the goal is realistic.
3. Practice ‘drive-thru’ communication.
Deb Kriebel: Follow the McDonald’s drive-thru lesson: When you’re listening carefully to someone, always repeat what you just heard the person say. Sometimes what you hear is not what the person thinks he or she said (or vice versa).
By simply repeating what you hear, you can clarify what the person really said or intended to say.
4. In decision-making, focus on consistency rather than perfection.
Jake Mason: Financial planning has taught me a straightforward process for making smart decisions:
1. Do your research (or get assistance from a professional).
2. Understand the pros and cons (risks and rewards).
3. Prioritize the pros and cons.
4. Make the decision that best balances the two.
If new information later emerges that makes you second guess your decision, try not to obsess over it. Remember that consistently making smart decisions will lead to much better overall results, even if there are occasional mistakes along the way.
5. Always be flexible.
Solon Vlasto: In financial planning there are a number of areas where we cannot predict exactly what will happen. For instance, we have no sure way of knowing how the market will perform, or what tax laws will change, or how healthy we’ll be in the future. We plan around these uncertainties and do what we can to control as much as possible, but we know we’ll have to make adjustments in the future. No matter how much preparation we do, we always need to remain flexible.
The same is true in daily life. Imagine planning a vacation: We research where to stay, what flights fit our schedule, even where to eat – and we often include some alternatives in case an option is unavailable. But despite our best efforts, there will be inevitable hiccups during the trip. That’s when it’s time to let the unexpected play out and try to make it work for you. The fact is, you just can’t plan for every eventuality.
6. Make no major decisions or life commitments during your first year of retirement.
David Kauffman: Your first year of retirement is an important transition period, and you have to ease into it before making additional life changes. Spend your first year getting adjusted to your new life: You’ll have fewer regular duties, you’ll be living on a fixed income, and you’ll be spending more day-to-day time with your spouse — all of these things will require an adjustment.
By the second year, most of this will have settled out. You’ll have an idea of your real budget, the suitability of your location, and how you’ll spend your days. With that done, you can begin to consider making more significant life changes.
7. You have a lot to learn (and you always will).
William Bissett: Financial planning has taught me that I have a lot to learn. Many of the clients I work with are twice my age, with long and rich life experiences. For example, the other day, one of the couples I work with told me they had $40 in the bank after they bought their first house. When the sale closed, they celebrated by going to a movie and buying popcorn. While they would be paid the next day, the couple went to bed that night with less money than what my son has in his piggy bank. (Now, of course, they have two homes, including one at the beach, and live debt-free.)
My clients routinely teach me about the importance of determination, hard work, trust, sacrifice, and love. I like to think that while I’m helping them with their finances, they’re helping me with everything else. Every good teacher must also be a good student.
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