Fun isn’t usually the first thing that comes to mind for most people when the word “fiduciary” is mentioned — but what isn’t fun about dreaming up the best possible life for you and your family? Even more fun, what if you had a systematic way to prioritize those well-defined dreams in your financial life? That’s fiduciary financial planning more or less.
Our recent webinar on goal setting — the first step in our process — covered simple exercises to align our values and goals with our financial plans. We’re presenting webinars to help educate our retirement plan participants, and individuals in general who just want to get a better handle on their finances. They’re based on the financial planning process we use to help our fiduciary financial advisory clients clarify and pursue their vision.
Values climb to clarity
We started with our “values climb” exercise to help attendees identify what is most important. How much time do you spend thinking about your values? The reason we start with understanding your values is that we don’t want there to be any friction between what is fundamentally important to you and your financial goals.
Ultimately, we are working towards a plan of action — and I promise we will get to taking action — but in our view many people make the mistake of jumping right into financial plan implementation. The foundation of your financial plan should be your “why” — your core motivations. That’s why we start with discovering your values. We highly recommend downloading and completing this exercise with a partner. Although you can certainly do it on your own. The worksheet is available on the attachments tab of the webinar. We encourage you to complete the exercises to prepare for the next webinar on getting your finances organized.
Goals brainstorm fun
The first step in setting goals is a quick brainstorming session, which can be more fun to do with a partner or friend to interact with. Have them ask you “What are your tangible goals that require money and planning to achieve?” and write them down.
Ask goal-focused questions such as, do you want to:
- Pay off your student loan?
- Be financially independent?
- Send children or grandchildren to college?
- Buy a second home?
- Take a special trip?
- Provide for family members?
Write down all the answers quickly. Don’t be specific yet. Remember you are just brainstorming and creating your wish list. Then review your values and ask yourself whether they’re aligned with your goals.
We had Nick brainstorm his goals and just write down all of the things that he thinks he might want to accomplish that would require money and planning to achieve. Once we do this, it’s easy to see where some of our brainstormed goals might be misaligned with our values. This enables us to focus, prioritize and refine them.
Set goals to focus planning
Nick took those goals from the brainstorming worksheet and got really specific in terms of quantifying and then prioritizing them. For example, is Nick going heli-skiing with his buddies more important than his annual trip with his spouse? This is where we start needing to make tough tradeoffs. But in the end, we have specific, personal financial planning targets to aim at.
If you didn’t get a chance to attend the webinar and complete the goal-setting exercises we highly encourage you do so. Not only are they pretty fun — they’ll help you prepare for the next webinar on taking action and implementing your fiduciary financial plan. We hope you can join us and follow along to the end of our five-part series to help achieve your financial dreams.