“If you don’t know where you are going, you’ll end up somewhere else.” – Yogi Berra

Yogi was right. Your financial goals are the place to start when you’re thinking about any aspect of your investment strategy. Plenty of people are paying attention to what the markets are doing and creating plans off of information that won’t actually help them get where they want to be.

When I meet with potential clients or when I’m just talking among my friends, I often hear statements like:

• “I want to get an 8% annualized return.”
• “I want to beat the S&P every year.”
• Or my personal favorite, “Look Taylor, I just want to be rich. Is that too much to ask?”

I understand where those ideas are coming from, but my job is to help people think differently about their financial future. I always have follow up questions to these statements that are designed to refine the goal.

• Over what period of time are we talking about?
• What if that return involves a -50% year in your portfolio, will you stay invested?
• What does rich mean to you?
• Do you want to be free from a 9-5 job?
• Do you want ensure your children are not saddled with student loan debt?
• Do you want to retire to a nice house in a nice place?

The answers to these questions are deeply personal but they bring so much clarity to the process of financial planning.

Imagine!

Your very first step to creating a financial plan is to dream. You get to create the vision of a future you want to live inside of. When working with our clients we like to ask them to “imagine”. It’s one of the most fun parts of what we do. You get to dream and think about your ideal life.  To help with the task, we ask questions such as:

• Imagine we are meeting 5 years in the future. What do you hope to have accomplished between then and now?
• How have your finances changed as a result of your accomplishments?
• Imagine your retirement, where are you, what are you doing?
• Imagine you and your spouse moving your child into college. Where is it? What kind of school?
• If you could shape your child(ren)’s future, what would you be sure to include?

Those questions begin the process and then we hone in on your specific long-term goals. We don’t let broad answers suffice. We help you get specific and once a clear picture of the future is established, it’s time for the next step.

“What is the best way to eat an elephant?” One bite at a time!

Dreaming big can lead to anxiety for some people because the distance between where you are right now and where you want to be can seem very large. However, every long-term goal can be managed simply by breaking them into smaller goals. We collaborate with our clients, and work hard to understand the actions they are willing to take on an annual basis to chomp their way forward. We look into the budget to understand how much they are willing to save and to evaluate how much risk they are willing to take on to gain the reward we can reasonably expect over various periods of time.

Use benchmarks and set deadlines

By using annual benchmarks and setting deadlines for review, goal tracking can be quantified and make the process much easier. Of course, there will be times when client’s are moving faster or slower toward a set goal. That’s not a problem, that the reason we review, to evaluate and adjust based on new priorities or new passion projects.

We strongly believe in establishing set intervals for this review process to keep your goals and financial plan in lock step.

See Your Plan

At PSWA the cornerstone of our financial planning and wealth management process are two documents we build for our clients.

1. Financial Strategy Action Plan: This document provides an overview of the annual actions taken by both the client and PSWA team to move our clients toward their stated goals. For our clients, it helps measure progress toward the smaller goals. It reminds them of the actions they should be taking to improve their probability of success. For the PSWA team, it drives our delivery of advice and help us to answer client questions by establishing a hierarchy of client goals and ensures we understand what’s most important to our clients.

 

2. Investment Policy Statement: This document explains the longer-term client vision and specifically outlines the client’s expectations for their investment management. Each client is different and we custom-build investment portfolios to match their preferences. This document outlines the Fiduciary responsibility of PSWA and outlines the actions PSWA is taking on an ongoing basis to monitor, adjust and implement the customized plan. This helps our team and clients maintain a long-term view of investments in relation to the things most important to our clients and not lose sight based on shorter term events.

At PSWA we believe in offering the highest quality advice and guidance. We believe that begins and ends with the client. We believe that accountability and transparency are key tenants in long lasting and meaningful relationships. Working with our clients to help them identify their goals, enhances our understanding of what is important to them and therefore improves our ability to provide the best advice to optimize their probability for success. We also believe that by putting these goals down in writing holds the team at PSWA accountable to the expectations of our clients and allow our clients to quantify the value we deliver to them on an annual basis.

If you’re ready to start dreaming, we’re here to help.