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Focus on Your Financial Planning

The ever-changing financial markets mean that it’s tough to plan even a few weeks ahead right now - but given this challenging environment, there’s never been a better time to consider your personal financial planning and look to the long term.

Phil Roberts, financial planner at Capstone Financial Partners – MassMutual, discussed just that during our recent webinar, Three Actions to Take in a Low Rate Environment.

Successful financial planning, he says, is about having control, understanding risk, setting and meeting goals, and having the financial freedom to make choices to improve our lives.

His presentation highlighted the hot topics he’d been discussing with his clients this past year, as well as what we should all be doing given our present interest rate environment.

“2020 has been a very interesting time for financial planning. Depending on your situation and your finances, it’s been a pretty good year in hindsight when we look at markets,” he notes.

“It's good to think about why we do financial planning. We want to have control over our day-to-day finances, we want to plan for risks and have the capacity to absorb financial shocks, we want to meet our financial goals, have financial freedom, and be able to enjoy our assets.”

“At the end of the day, there are really only three things we can do with our money: we can spend it, save it, or give it. You can't take it with you so we need to figure out how we enjoy what we have, save, or be generous where we can.”

Planning provides clarity, he says. After all, our lifestyle will be dependent on the financial decisions we make.

It is therefore vitally important to lay the groundwork and take the right steps to ensure a bright financial future. In terms of retirement planning, for example, this means taking appropriate decisions based on our longevity, inflation, rate of withdrawal, asset allocation, and health care.

In retirement, you’ll likely face a fixed income, have finite savings and assets, and only a short time to recover from any financial setback. That means making decisions that work well if you live a long term while also considering the possibility of outliving your money.

Create strategies that provide income for life, increase contributions towards your retirement, delay collecting social security, and take less from your savings, he says.

“There’s a limited amount of money that we have and then there are all these competing goals. I want to live and enjoy my life right now, but I also want to help my kids go to college, I also need to pay for childcare, I need to save for retirement, and I need to buy certain insurances. It can all become very overwhelming and that's what a financial plan is designed to do; to lay out all these goals that are sometimes competing with each other.”

 

If you missed the presentation in December, click the following link to watch the full webinar: https://www.nacd.com/pub/A8050BFA-EAC2-1D28-2625-D6CEC37E334C

 

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