When I tell people I’m a financial advisor, the first question I often get is, “What exactly do you do?” I love this question because, at its core, I’m really being asked, “What is financial planning?”
We discussed this a bit in last week’s blog post “Financial planning for everyone.” Financial planning is essentially putting a strategy in place that empowers you to make better financial decisions over time. It requires diligence, patience, and a willingness to change old habits and begin new ones.
Easy peasy, right? While the “what” may be easy to answer, getting to the “how” is when people start getting anxious. How do you begin to make changes in your financial life? For many people, that simple question will have you turn right around and walk out the door. Change is scary, and fear of running out of money is very real. The root of this fear comes down to the numbers - how much will I need to retire, how much do I have now and how much will I need to save between now and then?
But underneath this fear is a much more dynamic question and one with far greater impact – will I be able to continue living my life the way I am used to? Achieving this depends on many things, but a huge factor is your lifestyle: Do you live modestly or extravagantly? Do you envision your retirement being spent traveling around the world or working in your garden? Does the thought of one day downsizing to a smaller home make sense? Or is it unimaginable?
Whether you are confident in your financial situation or not, everyone will have different reactions to these questions. For many, these questions are not comfortable. In fact, facing them may be downright terrifying. So, how do we deal with these unknowns?
To get started, there are many free tools and retirement calculators online to help you. They can provide a glimpse of insight into what your retirement needs are to continue living the life to which you are accustomed. This is a starting point. Remember what we said in the beginning? Financial planning is learning how to make better decisions over time. It takes patience, diligence, and a willingness to change.
This is your chance to be brave and take the first step on your journey toward your future self who is financially confident and has financial freedom. Take this first step and don’t give up! Look at the numbers, take it in, and if you haven’t already, begin thinking about how you are going to get there. Retirement is something we must start planning now. It’s never too early, and more importantly, it’s not too late.
