When Life Changes Your Plan, How Do You Adapt?
About the author: Curtis holds an insurance license and a Series 66 securities registration as well as a degree from the University of Nevada, Reno. He has over 16 years of experience in the financial industry, helping others protect, grow and manage their wealth. Curtis helps clients create customized strategies for their portfolio based on their unique financial goals.
Last weekend my family and I decided to take a long weekend up to Lake Tahoe. Lake Tahoe is one of those places that we always seem to take for granted. It is a beautiful spot, one that many people travel from all around the world to see and with it being in our backyard, you would think people like myself would make more of a conscious decision to get up there and get away more often. Being someone who likes to plan things, I had a whole itinerary for my family to follow for our three days up there.
Well, like all good plans, nothing came together as I expected. There was a cycling event that ranged all the way from Tahoma to Emerald Bay and was scheduled for the entire weekend. So, my plan had to be adapted as we had goals in mind of what we wanted to accomplish during our getaway. With that one minor event we now needed to make some changes to our plan and doing this with an 18-month old can be pure chaos. However, with some communication back and forth and some different ideas between my wife and I, we were able to reach our destination without any added headache.
The reason I bring this up is that your financial plan should be no different. Life will happen, things will happen, changes will happen. One thing will go according to plan and another will just fall off the rails. To this I would say, that is what we, as financial advisors, are here for. We know that having that foundation of a plan is important, we also realize things will change and that at times in our relationship with our clients we will have to adapt.
It is important, almost paramount, that the lines of communication remain open. People get busy with work, life, you name it. It is important that communication remains clear, so as things change, the proper discussions can happen to adjust to those life events, changes in thoughts, or even possibly looking at alternative paths. Having ongoing reviews, open lines of communication and face to face meetings allow both parties to make sure when change happens, we can make sure to adjust properly to accomplish our goals.
For example, I had some clients come in last week who had some questions regarding increasing some of their spending for the next five years, as they planned to travel to their dream destinations of Europe and Thailand. So, for our review we sat down and looked at different levels of spending and what could go right and what could possibly go wrong. We had a good open discussion about spending, risk, risk reward and inflation.
What we were able to determine during our time together is that they would be able to increase their spending, barring we did not have them situated in a portfolio with too much risk. It was important for them to see that if we had too much risk exposure and were to experience a significant correction in lieu with their increased spending we would potentially put their financial security at risk. It allowed us to have some real in-depth conversation about gains vs. losses, risk and reward and how we could adjust their plan to achieve their goals. Sitting down together to weigh the pros and cons of such a decision allowed them to have peace of mind as we made some changes to their financial plan.
Remember, as a financial advisor we expect things to change across a myriad of different paths. At Cornerstone, it is also our job to make sure we stay on course to help you achieve your goals. Whether it is a cycling event on a two-lane mountain road, a family trip to the Hawaiian islands or a change in your risk comfort level we are here to work with you to make sure we can adapt your plan to help you to achieve your goals.