4 Financial Planning Excuses You Might Be Using

financially savvy kids

By K. Bridget Schneider, CFP®, CRPC®

financial planning excuses

October is National Financial Planning month.  I’ve written various blog posts discussing the importance of developing a financial plan and even how that plan may differ for special groups like women.  Unfortunately, you might still be putting this off for a future day.  So, let’s consider 4 financial planning excuses and see if any of them hold up.

Excuse #1 – I Contribute to My Employer’s Retirement Plan

Deferring some of your pay into your employer-sponsored retirement plan is a great way to save for retirement.  But it is NOT a financial plan.  The financial plan considers:

  • how much you are saving,
  • whether your employer makes contributions on your behalf,
  • the potential rate of return based on your investment allocation,
  • how long before you need to take income, and
  • how much of your future income need might be met by these savings.

I’m glad you’re saving for retirement, but without a financial plan, you don’t know if you are saving enough to meet your future income needs.  So, this financial planning excuse could leave you short of money when you need it.

Excuse #2 – I’m Not Sure About My Financial Goals

Are you unsure what your financial goals are or are you afraid to state them to another person?  It can be scary to state a goal that is different than your current reality.  What if you don’t achieve it?  You may even find it difficult to envision a future that is substantially different from how you live today.  

If you are having trouble listing your goals, I suggest starting to explore the possibilities first.  The first and most underrated thing that a financial planner can do is help you understand the many possibilities ahead of you.  Together you can examine different scenarios.  This process helps you understand the trade-offs and choices that you will have to make along the way with each one.  You become empowered to choose the possibilities that are most comfortable for you.  Then you can develop realistic and meaningful goals. 

Excuse #3 – I Don’t Have Enough Money to Need a Financial Plan

Do you think financial planning is only for the wealthy or something you do a couple of years out from retirement?  Actually, the opposite is true.  While a financial plan developed later in life is better than no plan at all, it’s best to begin in your 20s and 30s.  Many of the decisions you make at that age can have a great impact on your financial future. 

For one thing, insurance premiums are less expensive when you are young.  In addition, savings and investments have more time to benefit from compound earnings the earlier you get started.  Furthermore, having a financial plan can help you focus on your goals which may help you stick to a budget.  And sticking to a budget may help your money do more for you.

 Excuse #4 – I’ve Got Time

No one wants to think about death or becoming disabled.  It can be emotional and scary.  Sometimes it is just too hard to envision.  But the consequences of not having a plan in place are far scarier.  Unfortunately, I have seen this firsthand.  You understand you will die someday but you may think of it coming after a long and happy life.  It isn’t common to consider death earlier than expected. 

But what if the mortgage on your home isn’t paid at your untimely death?  Where will your spouse or life partner live if your wages covered that mortgage payment?  Perhaps you still have children living at home.  Who will care for them?  How will their financial needs be met after you are gone? 

I encourage you to hope for the best but plan for the worst.  A comprehensive financial plan can and should address issues like these.  Grief is difficult enough without adding feelings of financial insecurity for your survivors.

Financial Planning Excuses Exposed

As you can see these 4 financial planning excuses just don’t hold up in the end.  A financial plan can be a valuable tool and should be updated as time passes, and events of your life unfold.  However, the first challenge may be in knowing what your financial goals are in the first place and having the ability to explain them.  For those of you who are still struggling with defining your goals, a valuable action is to examine the various possibilities before even thinking about what your goals might be. 

Consulting a Certified Financial Planner™ professional may be helpful as you consider what possibilities are realistic for you in the first place.  Once you decide which possibilities are right for you, the financial planner can offer the most efficient recommendations to get you to your desired goals so you can focus on what’s most important to you.  Be sure to visit our website today or call us at 217-605-8130.  At Connections Financial Advisors, our mission is to help you make more informed decisions to better your financial position and reduce your financial stress. 


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