How a Financial Planning Process Can Help You Achieve a More Prosperous Future

Compass points towards success.

Everyone has different financial objectives. Maybe you’re saving for a larger nest egg or higher education. Your aim could be financial independence and early retirement, or maybe you just want to splurge on yourself and your family.

Regardless of whether your goals are short or long term, incorporating a robust financial planning process is key to successfully managing your wealth and achieving financial peace.

Even if you’ve been flying by the seat of your pants, financially speaking, you can still start today and look forward to supporting your purpose and living your desired quality of life.

4 Key Steps of the Financial Planning Process

Assess Your Current Financial Health

Financial health is not a static thing. It will fluctuate depending on the savings and assets at your disposal measured against debt and the rising cost of living (inflation).

Some questions you can consider to assess your financial situation are:

Pyramid of financial planning, protection base, saving in the middle and investing at the top.

Do you have an emergency fund?
Are you able to meet your needs?
Do you have debt and what percentage of it is high-interest?
Do you have health, life, and disability insurance?
Do you feel on course to meet your long-term goals?

Strong financial health may not be a fixed point, but some of its signs are a reliable flow of income, stable expenses (that are less than your income), a growing cash balance, a growing net worth, and steady returns on your investments.

See the Objective

What is most important to you? What kind of life do you envision for yourself?

When you think about the return on investment, monetary returns are not the only goal post. In fact, the idea of goal posts is restrictive to that long-term financial marathon you want to run.

A holistic approach that covers both monetary and life goals will give you financial peace and fulfillment. This is where Stonecrop Wealth Advisors comes in handy to help in understanding the financial planning process as a whole, not only as a sum of parts. You know, the forest vis-à-vis the trees.

The Stonecrop approach is to assess your “return on life”.

Mature couple smiling, signing off on a successful financial planning process.

We want to know your backstory first. Your experiences growing up, your financial education, the career path you chose, your family, and experiences with money all inform your financial choices and goals.

While no-one can decide your life goals for you, our detailed questions during your first consultation will help paint a complete picture of your past, present and desired future, and inform us on how to best advise you on your finances.

To get started, take our quick survey to find out how well your financial standing reflects your ideal life.

Find the Path

Once you have the destination in mind, it’s time to chart the way forward.

One way to look at the financial planning process is as a pyramid.

While each stage of financial planning builds on the preceding stages, they are also happening in parallel timelines and it helps to consider them holistically. This approach will ensure that short-term, medium-term and long-term goals feed into the path and outcome that holds most value in your life.

For instance, if you are ready to tackle your charitable giving plan, it will go hand in hand with your estate planning needs, which include charitable trusts or legacy donations. You can’t leave out tax reduction strategies because figuring out how not to pay excessive capital gain tax saves more funds to invest in your family’s future or your charity of choice.

Consider our client’s experience:

A successful lawyer in her early 50’s called Stonecrop after her terminal cancer diagnosis. She wanted a financial path to ensure that the wealth she had saved over the years and her life insurance would educate her two high school and college-going kids. Equally important, she wanted her husband, who had sacrificed his legal career, to care for the kids, to be financially stable. With our guidance, she could finally rest without anxiety, knowing that there was a path in place for her family’s financial stability.

Each person’s financial path is unique and based on their circumstances. That said, our expertise will help you carve out :

A comprehensive risk management plan
A long-term investment plan, which considers your risk profile and investment objectives, such as buying a second home or a college fund
Legal tax-reduction strategies
A retirement strategy
An estate plan
A net worth statement
An annual cash flow report

Navigate Past the Obstacles

Life and the investment market are as volatile and unpredictable as the sea. Your financial plan and your relationship with your financial advisor should be flexible enough to respond to the vagaries of life and design out-of-the-box solutions.

We have the client track record to prove this:

I was 52 years old, fresh out of a divorce and deathly afraid of my new financial situation. I needed a path to the life that I wanted with the resources I had on hand, i.e. my relatively small income as an event planner and my modest retirement account.

Above all, I wanted to be free of that ever present worry and fear for my finances.

After a year of working with my financial advisor at Stonecrop on disciplined saving plans and appropriate investments, I was happy to realize that I was no longer afraid.

Financial planning is dynamic and continuous. If you’re looking for a wealth advisor who wants you to prosper both financially and aspirationally, connect with our wealth advisors today.