Ten Years Gone: People Evolve, Plans Should Too.
Recently on Facebook was the 10-Year Challenge: post a picture from then next to one now. Quick and easy, yet most of what happened during the decade of my 40’s is missing.
As a fee-only Certified Financial Planner, I get inquiries from young professionals and families seeking a financial plan. Good intentions until I hear, “I think once we have a plan, we won’t need ongoing help”.
A plan is not a buy-and-hold investment, it needs to be dynamic as you evolve. Let me share.
In January 2010, my wife and I were renting, paying down graduate school loans and I got laid off. A financial plan would have captured: rollover 401k, decision pension and RSUs, consider term insurance and reduce expenses.
Fast forward two years, this 2010 plan missed: new job impacting cash flow, choosing employee benefits (wife’s or mine), student debt elimination, new savings priorities, partial Roth conversions and wife changing jobs (impacting cash flow, benefits, 401k). Also pre-approval to buy a house, financing to avoid PMI, choosing a realtor and closing to end 2011.
But change continues.
Our first child brings joy, plus new budgets, a 529 plan, FSA Dependent Care, wife’s term insurance and new used vehicles. Building financial independence, we refinance auto loans and mortgage, open HELOC, tax planning, Roth conversions, max-out 401Ks, IRAs and HSAs, enroll ESPP, decision RSUs, etc.
Then, new challenges arrive.
With our second child, we realized my 80% travel for work wasn’t sustainable. What’s the plan? The financial flexibility needed and by when?
This brings further expense reduction, increased investing and two years later I start my own firm. We address concerns of “what if” for girls by selecting an estate planning attorney for trust, POAs, health proxies and guardianships.
Meanwhile my parents with an estate plan, won’t acknowledge changes to their lifestyle given slowing independence. Over the decade, conversations expand and actions include maintaining skyrocketing long-term care premiums, staying invested and tax planning to sell two properties.
Today, my wife and I live in a home raising our girls and caring for aging parents.
Our path wasn’t linear and financial plans modeled in 2010 to 2018 are archived snapshots. However, these plans with help from other professionals, were critical to make important decisions that shape us today.
To the next decade of new adventures, dynamic plans and people to help guide the way.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Glenn Brown is a Holliston resident and owner of PlanDynamic, LLC, www.PlanDynamic.com. Glenn is a fee-only Certified Financial Planner™ helping motivated people take control of their planning and investing, so they can balance kids, aging parents and financial independence.
This article appeared in the January editions of Holliston Local Town Pages, Ashland Local Town Pages and Natick Local Town Pages.
Please call me at (508) 834-7733 or directly schedule a meeting to learn more about considerations for planning and investing so you can balance kids, aging parents and your financial independence.
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