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Mark Zaifman's thoughts on money, global economic trends and politics

Successful Financial Planning Begins with Thinking from the End

Mark Zaifman   |    Tue, Jul 10, 2012 @ 09:11 AM

successful financial planning begins with thinking from the endOf the many aspects involved when designing a comprehensive financial plan, probably my favorite element of all is helping clients decide on their number.  The number I’m referring to is your total net-worth, but more specifically, the amount of liquid assets you’ll need to accumulate by the time you’re ready to retire or stop working for money.

The impact this number will have on your lifestyle will be a determining factor in whether or not you have a ‘garden view retirement’ or an ‘ocean view retirement’. And as Seinfeld would say….not that there’s anything wrong with a garden view retirement…I’m just saying….

If you’re someone that has learned to use your imagination and creative visualization skills to manifest your desires, than visualizing an end point and working backwards is familiar terrain for you. As a matter of fact, you’ve probably visualized reaching personal goals many times by keeping this end point in mind. And when it comes to planning for your future, it’s this end point that requires serious contemplation and often lots of negotiation, and here’s why.

Retirement Planning, Table for Two Please

Each one of us has a unique relationship with money. And when we’re in long-term relationships, although we merge our money together for the most part, our priorities and our values around our money and our life are very often different.

A common mistake financial planners make is treating a couple as if they were one person with zero differences around money. It’s only when you learn and appreciate to embrace and discover the unique differences each person brings to the table; from their individual money history to how they spend, earn and save money to how they individually as well as jointly visualize their retirement years, it’s at that point breakthroughs occur and couples learn the value of working as a team when it comes to their money and their life.

Like with any pursuit in life, making sure you and your partner are on the same page in terms of financial life goals is crucial to success. And waiting until you retire to discover your partner has plans that are totally and completely opposite to what you imagined your retirement would look like is just begging for conflict.

Whether you’re one year or fifteen years away from becoming financially independent, now’s the time to check in with each other and discuss the big picture. Define your end point, your number and develop a plan to reach it. Take a weekend away, call it a financial summit, and discover what each one of you is imagining your life will look like when retired. Use this as a starting point for aligning your individual financial goals with your joint goals. The sooner you do that, the sooner you’ll be working as a team when it comes to your money and rowing in the same direction.

From there, make sure you both fully and completely understand your number, understand how it plays out in terms of the big picture, the tradeoffs necessary to have the lifestyle you both desire down the road, why you’re saving the amount you save each month and perhaps most importantly, how as a team you will reach your goal.

If your money and your life are not in alignment with your values individually or jointly, you will struggle to achieve financial independence. You’ll arrive, but the journey will be tiring and you will feel exhausted and depleted by the time you reach the finish line.

On the other hand, working in unison with your partner, seeking common ground, developing a financial plan that truly motivates and inspires you both is following the path of least resistance. And once you feel what it’s like to be not only on the same page with your beloved but to harness the power of two and have the wind at your back, then be sure to load up on lots of sun screen as that ocean view retirement will be yours for the asking.

Thinking from the end is how we create our reality to be what we want it to be.


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