Where are you going?
Date Published: 29/11/2007
Life can be like being on a very large hamster wheel. But have you ever stopped to think about why you do what you do? If you haven’t, we can help you with a number of important issues.
Many of you will have taken advice from professionals in the past, in order to sort out your pensions, life assurance, ISA or investments. Very often, objectives will be described as, ‘Capital growth’, ‘Income’, ‘Utilisation of your ISA allowance’.
Unfortunately, these ‘objectives’ are not really going to do anything for you, because the ‘why?’ is still missing. Another common example is, ‘I want to retire at age 55’. Again, great idea, but it still doesn’t really help.
Without clearly defined objectives, how can you get ‘there’, as you don’t really know where ‘there’ is. This is the vitally important life planning part of financial planning.
We begin by understanding your real objectives, in conjunction with you and your partner, , until, using our example above, we arrive at something like, ‘I want to stop working at age 55 and continue living in your home town, but to spend four months every winter in The Bahamas as I dislike UK winters. This will cost me £20,000 every year in today’s money, on top of my normal annual living expenses of £40,000, in today’s money’.
Now you have an objective that can be worked with!
Generally, most people will have a number of objectives. These can fall into different categories ranging from ‘absolute requirements’, through ‘if we can do it, this would be nice’ and ending up with ‘the rest of the wish list’.
It is imperative to prioritise your objectives so that the most important are dealt with first. We will help you determine the right order of events; financial planning is a little like dropping a stone into a pond, with the ripples radiating outwards and affecting everything. In other words, one decision will have a knock-on effect on the next, which may have important implications.
Without establishing where you are today, you cannot plan a path to achieving your objectives. So, armed with this information, together we will be able to carefully analyse your current position and develop the path to successfully achieving your objectives.
Then you will know why you’re on the hamster wheel of life!
