Close your eyes and imagine what life would look like if the person you said “I love you” to this morning was suddenly gone? What would your future look like? Are you going to be okay financially? Can you send the kids to school? Can you stay in your home?
Today we are going to take a look at the three stages of planning and how each stage plays a vital role in meeting your financial needs today, tomorrow, and beyond.
There are three stages to the financial planning process after a time of life transition. The first stage is what we refer to as your “immediate goals.”
Stage One: Immediate Goals
This is a time for gathering your information to figure out what you have, where your income is coming from, and what your ability to save is. Oftentimes this comes with a slew of paperwork that might seem to be written in Greek to you. It’s important to have someone to come alongside you to help you understand and organize so you have a snapshot of where you are right now.
These immediate goals usually last through the first year of your life transition.
Stage Two: Transitional Goals
In the second stage, we have “transitional goals.” These are the goals that help you transition through the next 2 to 3 years. These are the goals that when you have a sense of your new normal, when you have a little more clarity on what you want your life to look like for the next few years whether it be a new home, some education, a new career, it’s the new snapshot on your journey to what’s next for your life plan.
This is when we actually start to figure out what works, what doesn’t, and what needs to change. This is the time when we determine what your choices are and to begin making your money work for you to help you create your new life plan.
This is the time when you get your groove on. You have caught your breath and you are ready to run.
Stage Three: Long-Term Goals
In the third stage, we get to play with the “long-term goals.”
These goals are for 5 years and beyond, goals like retirement, aging, gifting to our kids, planning for the future you deserve. We made some really good choices during that transitional time.
What’s changed since we first had this transition? What’s changed? Do we need to update our goals?
We started off with a financial plan when the transition first happened. This financial plan is a living breathing document with your advisor truthfully working alongside you helping you understand your opportunities and the impact of your decisions.
Your long-term goals probably stayed the same, you probably still want to retire, a goal that most likely didn’t change. This is the point at which we can actually check our progress to those goals and make any necessary adjustments to keep you on track.
In summary, there are the immediate goals (your first-year plan), where we gather a snapshot of where we are right now and what we HAVE to do.
The transitional goals take place in your second or third year. These are where we decide what you want for your life next. We put a plan together on how to get there.
The long-term goals happen after year five. These are for the standards; retirement, healthcare in retirement, and other opportunities now that we have better control over our life plan.
Get a piece of paper, fold it in three. At the top put your haves, needs, and wants. Once you have your list, give me a call and we will discuss the first step towards meeting your financial goals.
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