What Exactly is a “Financial Plan?”
People throw around the phrase "financial plan" rather loosely. Today, we'll discuss how we define what a financial plan is and why everyone should have one.
Listen to the Episode
Historically, the phrase "financial plan" conjured up images of a 200 page book filled with charts and spreadsheets. While these "decks" contained valuable information, often times they were reviewed once then put on the shelf to collect dust.
Today, new technology and a better understanding of how people consume information have combined to make the financial planning process a practical and effective way to plan for your future.
Listen as Bill Keen discusses what "financial planning" looks like today and how having a plan and updating it regularly could be your ticket to financial freedom.
Download the Transcript Here
Five Quotes From Bill in This Episode
- A financial plan starts with "why." The first thing that I think folks should really think about is the why, the why behind what they're doing. And that why can be in anything, not just financial issues.
- A "one and done" plan is not worth the paper it's written on. I recommend sitting down and looking at a financial plan at least once a year, maybe twice, and review it when major life events happen. We've got to keep the plan current and realistic, too. You also have to believe the plan is your plan and not a plan that some financial institution has pushed on you, or someone's helped you half-heartedly fill out a questionnaire.
- Market volatility is easier to handle when you have a plan in place that you believe in. When you're saving money all of the years that you're working, volatility is your friend. If you can understand that view, you're buying more shares cheaper. You can look back and see that the corrections had been your friend, you just bought more shares during the corrections. When you're taking money out, the volatility now is something that really needs to be looked at and understood so that we're not forced to sell things at a bad time, or so we don't panic at a bad time and make an emotional decision. Having a plan that you believe in because you understand the why behind it, the methodology in the planning, is super important.
- What's lifestyle got to do with it? What I've seen happen over the years is folks get to a point where they know they could work another year and make more money and all of that, but it's not about that anymore, it's a lifestyle question. I'll tell you what, it frees up so much space in your mind if you know you've done the work, you've vetted the possibilities, you've looked at everything from a technical standpoint, looked at your assets, ran the numbers, and you know that you've got a plan. You know that it's time to step into the next half of life, the best half of life.
- It goes both ways. I believe that for an advisor to help a client, to really provide them with service, and advice, and counsel, that it has to be a two-way relationship, completely open, trusting, and communicative. It's going to be something where there's mutual respect. I can tell you the process that we run through at our firm, we go deep with folks. I believe that you have to, to actually do the job as a fiduciary.
On the frequency of planning...
It's not just a one-time thing. When we run our first financial model, that's just the starting point. From there, it's a lifetime evolution.
Please share this page and the podcast with your friends and colleagues via Linkedin, Twitter and Facebook. You can use the share buttons. Thanks!
Got a question or comment? Email it to me and we'll get back to you.
Bill Keen is a CHARTERED RETIREMENT PLANNING COUNSELOR℠ and independent financial advisor with more than 25 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he specializes in providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.
KWMG, LLC’s dba Keen Wealth Advisors (“company”) is an SEC Registered Investment Advisor located in Overland Park, KS. The company and its representatives may only conduct business in those states where registered or where excluded/exempt or from licensure. For registration information please contact the SEC or the state securities regulators for the states where the company is notice filed. A copy of the company ADV is available upon request. Advisory services are only offered to clients or prospective clients where the company and its representatives are properly licensed or exempt from licensure. No advice may be rendered by the company unless a client service agreement is in place. This information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy and is for illustrative purposes only. Clients and prospective clients must consider all relevant risk factors involved with each strategy, including costs or fees, and their own personal financial situations before trading.
The views outlined in the book, Keen on Retirement Engineering the Second Half of Your Life, are those of the author and should not be construed as individualized or personalized investment advice. Any economic and/or performance information cited is historical and not indicative of future results. Economic forecasts set forth may not develop as predicted.
The Amazon Best Seller ranking listed on marketing materials is specifically referring to Best Seller rankings for the Kindle Top 100 Paid Lists under the subcategories of: Budgeting and Financial Risk Management, based on data as of September 5, 2019. Amazon rankings although relevant on how a product is selling overall doesn’t necessarily indicate how well an item is selling among other similar items or similar item categories. Amazon may choose the most popular categories or subcategories within which an item has a high ranking to determine its best seller rankings. These rankings are updated hourly and as a result, should be expected to fluctuate as such. Keen Wealth Advisors and Amazon are not affiliated entities. For further details on Amazon rankings please visit https://www.keenwealthadvisors.com/important-disclosures.