Problem: Poor planning – short/medium/long-range goals

You may be familiar with the acronym “6 P’s”: Prior Proper Planning Prevents Poor Performance. You may have even used this yourself to help advance your career. In your financial life, the 6 P’s are essential to promote long-term strategy, goal setting, and success. Proper financial planning begins with spelling out your short, medium, and long-range goals. Said another way, the Magic 6 P’s of financial planning are Plan, Plan, Plan, Plan, Plan, Plan.

Plan 1: Establish needs and wants. Be open and honest about the kind of lifestyle you envision. What will make you comfortable? Happy? Secure? And at the same time allow you to celebrate your success?  An important part of Step 1 is to understand your strengths, shortcomings, and your temptations. Are you a disciplined saver? Then push your savings to maximize each dollar. Are you a person unable to say “no”? Supporting others and causes is noble, and, in this case, a planned giving budget will help guide those decisions. Know who you are, acknowledge the things that may distract you, and be honest about past negative behaviors. Let it all out.

Establishing wants and needs isn’t all about setting restrictions. It’s about being real. And giving each dollar a purpose.

Plan 2: Set realistic goals. Have a conversation about your aspirations and dreams. This includes setting short-term goals— typically those that can be achieved within one year—like taking a vacation or buying a new car. Medium-term goals— those you would like to achieve in 3-5 years—like buying a home, starting or adding to your family. Long-term goals, like what you envision for your next career, retirement, or a vacation home that helps you unplug from your demanding schedule.

Plan 3:  Build a strategy to reach those goals. Now, you have established a strong sense of who you are, what you want, and what your future looks like.  Building a successful strategy is the process of combining the direction you will take with the goals you have to achieve what you want.

Plan 4:  Architect the details. This is where details are defined, and the fundamentals are put in place. It is your roadmap to preserving, protecting, and building wealth. It’s your HOW.

Plan 5: Execute and automate. Your plan should be easy to execute and effortlessly automated. Everything is put in motion so you can feel confident that while you are focused on building professional successes, your well-constructed financial plan is working hard to provide safety and building the ability to achieve your short, medium, and long-range goals.

Plan 6 thru infinity: Evolve. You and your financial advisor will review annually and make any needed modifications, based on the original foundation of your plan.  Adjust for any changes – big or small – in your career and earnings path. Pay attention to your financial dashboard (as a Verdence/PRO client, your dashboard is the Verdence Portal). Track your success in reaching your short, medium, and long-term goals.

Translating the Magic Six P’s into financial independence takes strong D. Discipline. And surrounding yourself with those who will help and encourage you along the way.

The clutter we all accumulate throughout our lives can stifle even the most focused performers. Think of clutter as a fog that makes visibility difficult or sometimes impossible, direction misleading, and progress undiscernible. Legal issues, daily routines, scheduling conflicts, relationships, financial confusion, living arrangements…the potential list of “stuff” that can get in the way of our most efficient self is mind-numbing. Unfortunately, the things that make us less than our best can pile up quickly and in so many ways that we are unaware it is happening.

Organizing your personal and professional lives into lists, to put scope and context to what you are dealing with, can provide a roadmap toward efficiency. The front and back of our mind can be very far apart from one another, and when something is on our mind, we should immediately write it down. The opportunity to forget something decreases if we have a tangible reminder of it. When something unresolved hangs out there unremembered it will slow us down and could cause a critical misstep in what we are trying to accomplish. Habitually updating and referring to lists, especially for extremely busy people, will help show us what we have done, are dealing with currently, and have coming up in the future.

As the complexity of our lives increases, lists can be separated into categories to differentiate between work, personal, networking, health or whatever correlation is most preferred. The idea is to create a more discernable and linear path to accomplishing what matters the most to us. By separating our lists into categories, we can keep a more conscious balance in our overall lives and make sure we are spending time doing things to be successful. The more we check off each list, the further along we get and the closer we are to the next big breakthrough that awaits us.

There may be items that are difficult to fit into any of our lists because they overlap multiple aspects of our lives, tasks that seem to never get resolved, or things that continually reemerge no matter how many times we check them off. When you identify anything like this, take note, because unlike collective clutter due to a lack of awareness or overall organization, this may be specific clutter in the form of a roadblock. Earlier we likened clutter to a fog that made it difficult to see to the other side of something, well this type of clutter is the wall that you walk into while you are in the fog.

The major impediments in our lives that require substantial resources to eliminate are why the organization of clutter is so vital to our success. The identification and resolution of positive and negative milestones are what free us to be able to accomplish all our other list items. These are the big things that absorb big chunks of time and energy and create the environment for smaller things to get cast aside, delayed or forgotten. By organizing everything, these primary barriers can be identified through the fog of life and eliminated systematically to clear up everything and keep you on track to succeed.

Controlling clutter in life takes a conscious effort to identify, categorize, and manage our needs, wants and responsibilities. There will be good and bad that go with each, and we may never fully declutter everything that comes our way, but the idea is to organize our lives and be accountable to ourselves to keep moving forward toward success.

Here are some concepts to consider and ways to make sure you are getting sound advice and how to approach making decisions:

The resources should be unbiased, independent and/or aligned with you and your best interests.

• Ask how someone gets compensated based on the advice they are giving or what is in it for them and often their answer will speak volumes.
• If someone is making money from one side of a decision or advice versus another, they may be biased, and while their advice may be sound it may not be aligned with you or independent.

Someone who is aligned with you succeeds when you succeed and their only motivation for helping you and giving you advice is that they have as much to win or lose as you do from his or her advice

• If good advice is given, the relationship will grow strong and be built on trust. If bad advice is given, the relationship will grow weak and the failure will reveal that you need to seek better advice and find a new advisor.
• Advice that compensates the advisor regardless of whether it is good or bad, through transaction fees and commissions, means that your advisor will make money no matter if you succeed or fail, and the advice is not based on you, the client, but rather revolves around the compensation received.

Money and finance are business topics and emotion should be avoided to keep a clear focus and perspective on the matter at hand

Remove emotion from the equation. Instead, look at the facts so you can see the root of the situation.

• Advice should help you boil things down to their simplest form, and considering the cause and effect or the best- and worst-case scenario as they pertain to a decision is a good way to eliminate emotion.
• Decisions should only be based on the relevant facts and not on assumed variables or wild predictions.
• If you are calm and collected while discussing or deciding something, it can be a great indicator of your emotional involvement in the process and sound decision-making.