Money Matters – Financial Planning Week: Putting Together Your Financial Plan

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Financial Planners

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420x316-grad-lee Dee Lee
Dee Lee is a Certified Financial Planner who received a diploma in...
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BOSTON (CBS) – Today is the beginning of Financial Planning Week.

Everyone can benefit from financial planning. 50 years ago our financial lives were simple. There was one kind of mortgage, you had a savings account, there were no credit cards and if you wanted to buy a stock, you paid an 8% commission. Today the financial choices in our lives are overwhelming.

With all of the craziness in our lives people need to have a plan. And most do not. And they also need plan B for the contingencies that will ultimately occur.

When working on your financial plan, you need to be looking at the big picture. Most individuals do not have a plan of any kind for their future. Life happens and they react to the everyday things that come up without realizing how the decisions will affect them in five, 10, or 20 years.

The Financial planning process can easily be broken down into five simple steps.

  • What do you want? These are your goals.
  • What have you got? This is your net worth.
  • Saving and investing to get what you want
  • Managing the obstacles you will encounter along the way
  • Protecting the people you love and the assets you have accumulated

What do you want? This is a starting off point, the very first step. The big picture here. What do you want to be doing in 5, 10, 20 years? Where do you want to be living? What kind of job? Retired? And as grown-ups there is a dollar component to all of our goals. Remember a goal is a dream with a deadline.

Your number one financial goal should be a comfortable retirement. But often times buying your first house, credit card debt and having children put retirement planning on the back burner.

Make out a list of your goals. By writing them down you stimulate a part of the brain called the reticular activating system. This system triggers a filtering process and begins to collect information and routing it to the conscious part of your brain.

Now prioritize the list. What is the most important goal? Then write down the time horizon for each goal. If it’s a college education for the kiddo who is now four years old you will begin to need the money in 14 years. Fourteen years is your time horizon. Buying a house could be one or two years from now. Retirement is 35 years away.

So now you have a prioritized list of your goals, take it one step further. What you have is just an outline. Now fill it in. How much will you need to save? Where will the money come from? Do this with each item on your list.

To find a financial planner to help you achieve your goals and dreams in your area contact the FPA, the Financial Planning Association’s local Boston chapter: or their national website. Check out the free events the Financial Planning Association of Massachusetts has planned.

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