Updated: May 2
I have a hypothetical offer for you. What if I told you that I could guarantee that you will achieve all of your financial goals with no additional effort needed on your behalf? You will no longer have to save any money. You will no longer have to make any money. You just have to be productive and happy and over time everything you hope to accomplish will be guaranteed to come to fruition. Would you take that deal?
I hope you said no, and this is why: What if I offered you this deal 10 years ago? 20 years ago? What if I offered you this deal when you were eight years old? Sure, you have all the candy you want, a castle for a house and you can get into Disneyland for free whenever..but at your current stage in life, how satisfying is that?
Think about how your goals have changed even over the past few years. Your salary may have grown, your family may have grown (or left the nest) and you have experienced many life events that were either planned or unexpected. Some things that seemed unattainable just a decade ago may now seem not only within your reach, but no longer as exciting an achievement as it once might have been.
The average home sells every 5 to 7 years (homeinsight). 60% of retirees end up going back to work (careerbuilder). Sure, some are financially driven decisions, but a large bulk relate to pure dissatisfaction with current lifestyle. Life changes, interests change, goals change.
The bulk of my value as a financial planner is asking clients the question, “What if….?”. The majority of the time the ‘what if’ was never considered. Sometimes the ‘what if’ can feel insulting. “What do you mean I may not want to spend my eighties flying a hot air balloon around the world??” My role as a financial planner is not to discourage people from working towards achieving their goals, just to understand that today’s goals may not feel as important ten years from now. And more likely, your goals are going to morph and change based on family, health, financial gains or losses, etc.
What I create for clients is not a financial plan. It’s not a singular stagnant event. I have yet to hand over advice, wish the person luck and then read about their ballooning disaster in the news several years later. I offer financial planning. It’s an ongoing process with consistently changing parameters. Goals are defined and planned, then in time updated, altered and reassessed.
Is having goals fruitless if they will just change or be abandoned over time? Quite the opposite! You should have more goals, or several variations of a single goal. Make sure your plans include escape hatches that allow you to abandon a goal for a larger goal or conversely a more obtainable goal without the feeling of loss or emotional defeat.
Does your goal include purchasing a home? Make sure you consider the uncertainty of the market and imagine several variations of your dream home that would satisfy you. Don’t be committed to one. Do you want to have a retirement where you spend all your time with your grandchildren? Consider that you currently have no idea where they may live by then. Across the country? Another country? Maybe next door. Those are three different scenarios with drastically different price tags.
Of course, the dominoes of one scenario affect all the other aspects of your financial life. Also, there is no reason to hesitate changing our path, no matter how personal. The purpose of earning money, saving and chasing our dreams is to achieve personal happiness and satisfaction. If each phase of our life changes exactly what brings happiness, so be it. As long as financial restraints are not the reason we don’t have options, then we are doing our job to be fiscally responsible.
We are not letting ourselves down if we decide the cherry red corvette we one day promised ourselves is no longer appealing. Continuing to work (because we are enjoying it) is not failing our 20-something self that wanted to set foot in every continent. If using that money to fly your children and grandchildren to a family retreat in Hawaii would feel more satisfying to you today, there’s nothing wrong with that. Just fly commercial and keep the hot air balloon flights over land.