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What is a financial plan, and why should you have one?

| September 12, 2021

Would you pack up your car for a vacation, pack all the kids in the car, turn onto the highway and drive, without knowing where you’re headed?  Not usually!

Same thing goes with a financial plan.  How do we decide what to do with our money, if we don’t know what we are planning for?

At Marshall & Sterling Wealth Advisors, we focus on building solid financial plans for our clients that help them map out where they want to be. A financial plan is in fact quite literally what it implies – it is a plan; a plan put into place that is driven by your financial goals, and it maps out what you need to do each year, month, and day in order to get yourself there. 

Here are some of the most common goals I hear from our clients:

  • I want to make sure I am saving enough now, in order to retire in my 60’s
  • I want to save up to buy a vacation house
  • I want to save enough to pay for our kid’s college
  • I want to not financially worry about day to day transactions, and if a surprise expense pops up, I want to be prepared
  • I have employer compensation and stock options that I want to take in the most beneficial way for my situation
  • I may leave my corporate job and start my own business.  I want to have enough saved up to feel secure during that transition
  • I want to make sure that if something should happen to me, my family is provided for
  • I don’t want to take more risk with my investments than I absolutely have to

There is no goal that’s too large, small, or insignificant.  We factor all your goals in and then create a toolbox of strategies to help you pursue these goals.  Some common tools/strategies we use:

  • Income maximization and expense budgeting
  • A savings plan
  • Account titling and retirement plan usage
  • Maximizing benefits, executive compensation, and employer resources
  • Investments and rates of return
  • Tax planning and strategy
  • Insurance and risk mitigation products
  • Estate planning
  • Business planning

That is the basics of what financial plan looks like.  Start with goals – and use your tools to get there.  We factor in road bumps such as taxes, inflation, rates of return, economic changes, etc. and project how your current tools will work and grow given these challenges.  Given that, we can estimate a likelihood of achieving those goals.  Each year, we check in with the plan to make sure you are on track given any changes that have occurred.

You can read more about the plans we offer here: Focused Life Planning and Life Start Planning 

Any questions, I’d love to help.