The Elusive Financial Plan – A Reality Check

Oh my word, I need to write an article on the theory of the financial planning process and describe a step by step process to achieve financial nirvana.

Me: (turning to page 11 of the financial planning manual),OK let’s do this.”

  • Manual: “Determine your current financial situation.”

Me: “Oh no, you did not just ask me to do this!”

  • Manual: “Develop your financial goals.”

Me: “My goal is to skip step 1.”

  • Manual: “Identify alternative courses of action.”

Me: “I thought that is what I did in step 2?”

  • Manual: “Evaluate alternatives.”

Me: “Yes, please, I can think of about 100 things I would rather be doing.”

  • Manual: “Create the plan and implement.”

Me: “What were we doing again?”

  • Manual: Review and revise the plan.

Me: “Can we start over? I fell asleep …”

Me: “OK seriously (and be honest), who does this?”

Now, let’s say we have an idle hour or two, and we force ourselves to ponder the elusive lesser seen financial plan, is there a short-cut to this?  As an honorary member of the Financial Planning Procrastination Society (FPPS) I do think so.  Here is a short cut that may just work.  Just plot yourself on below graph.


If you are in the “keep working” space, find a good financial planner to calculate how much life cover you need, for how long you will need it and how much you need to save.  If you cannot afford the total premiums of both insurance and savings, cut each proportionately and accept that you are self-insured against death or disability to some extent.  (I am sorry, you are the one who is spending too much and saving too little, now you are stuck with the corresponding maths).

If you are in the “don’t lose this” space”, crypto-currencies, currency trading and everything else your neighbour wants to chat to you about is not a good idea.  (If these investments don’t bore you to death, you are doing something wrong, please stop).  Wealth Managers specialise in this field.  They are easily recognised by their thick spectacles and their underdeveloped sense of humour.  (I bet they will get angry reading this and prove my point 😊).

If you are in the “do what you want, plan worked” space, keep in mind that the best financial planning against taxes on death, is spending the money prior to that event.  If you loath to do it come and speak to us, we specialise in the transfer of wealth between generations.  We occupy that high intelligence – great personality spectrum of the financial advisory field.

Keep in mind that your relative position on the “short-cut” graph changes over time and so does your needs.  Your advisor should know the optimal strategy to address these.  Either the advisor must adjust to your financial growth, or your growth requires an advisor with different skills and mindset.

Then lastly, it’s perfectly fine for you to use the graph to get a basic idea of what your plan should address.  If, however, anyone who provides financial advice to you, guesses the maths, please ask then to rather do it properly (or run away as fast as you can).  Many a great plan has fallen foul of the pitfall of guessing maths.


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