Investing in stocks and bonds and saving a part of each paycheck is an important factor in reaching your financial goals. But does saving and investing mean that you have a financial plan? What about having a broker that picks stocks and bonds for you and tells you when to buy or sell your securities? Surely that means you have a financial plan, right? The answer to both of those questions is no. There is more to a financial plan than being a stock jockey and saving. What we have created for each client is a financial plan crafted around a Destination-Driven Process that matches client’s good intentions with the right direction.
Think about it this way: You live in Springfield, Missouri, and plan to go see a St. Louis Cardinals game at Busch Stadium. It does not matter how excited you are or how much Cardinals gear you have on for that game. If you get on the interstate and head south, you will never get to the ballpark in time for first pitch because you are going in the wrong direction. The same applies when planning for your financial future. No matter how badly you want to be a millionaire, if you do not save any of your money into investments that will get you to the millionaire status, you will never reach your financial goal. So, what are the steps in the Destination-Driven Process that help clients reach their financial objectives? Let’s break it down.
Exploration
The exploration part is the research phase of the process. This is when we discover what your short-term and long-term financial goals are. When we are in the exploration phase, we uncover where you currently are financially, which helps us determine whether changes need to be made to your current financial habits. Along with short-term and long-term goals, we find out your time horizon, risk tolerance, and financial priorities, ultimately allowing us to create a robust financial plan tailored to your exact needs. We also briefly dive into estate planning and tax planning strategies and whether or not any of those tactics are established or need to be implemented at the time.
Design
The design phase of the Destination-Driven Process is when we take all the facts from the exploration phase and use cutting-edge technology to match your financial goals and priorities with a plan that will help you reach your objectives. We also look at what investments and asset classes will work well within the plan, whether certain estate planning tools such as trusts would benefit your plan, and if any tax strategies could mitigate your tax burden. Furthermore, we use technology that helps us back up our words. It gives us the ability to show you what your current financial life looks like and legitimately forecast your financial future.
Collaboration
A crucial phase, if not the most important in the Destination-Driven Process, is the collaboration phase. This is when we sit down with the client and present our ideas and solutions based on all the information gathered in the exploration phase. We pride ourselves on educating clients, and this is when clients and prospects learn and understand what exactly they can do to reach their financial objectives and overall peace of mind. We also go over desired changes and ask additional questions to help understand your goals and the financial plan as a whole. Our job as advisors is to take the complexity of financial planning and simplify it so our clients understand and feel confident in a plan for the long-term. We do not expect clients to know every single component in their investment portfolio, but we want them to have proper expectations and an understanding of how their portfolio works.
Implementation
Once there is an agreement in the collaboration phase, we begin the implementation phase to make sure financial dreams can become a reality. We allocate client assets to the appropriate investments, establish proper client account access, and simplify accounts to ensure assets are consolidated and organized. Once everything is established, we start letting the assets get to work to reach specific financial objectives. A key thing to note is that an investment portfolio should not be set it and forget it. We adjust and rebalance when we deem necessary for the betterment of an investment portfolio. It is our fiduciary obligation to do so. Additionally, guessing is not a strategy, nor has it proven to be a successful one historically. Life changes and unexpected events happen, so when changes need to be made, we make them.
Evaluation
After the financial plan is underway, we want to make sure that clients are updated on how their investment portfolio is performing, but we also like to sit down and receive updates ourselves from our clients’ perspectives. That can mean meeting once a year, twice a year, or every quarter. Each situation is different. And no, we are not doing this to be intrusive, but we do want to make sure we are appropriately planning for your future so we are not caught off guard with any financial or life surprises. Even if no changes are necessary, we enjoy keeping an open line of communication with clients and their financial plans so they can be up to date with information and education while remaining confident in their current and future financial lives.
Whether a person is young and just getting started, close to or recently retired, or passing along assets for generations, our Destination-Driven Process can help simplify and be a guide for current and future financial success. Oftentimes, people allow finances to become a burden, no matter their asset level. Working alongside an independent wealth advisor who is a fiduciary can help take part of that burden off your shoulders.
Make sure that the person managing your biggest asset has a plan in place, but more importantly make sure that you have confidence in that person. If you do not have a plan, or if you don’t have confidence in the person who helped you create that plan, it may be time to make a change. At best, you’re delaying your own financial peace of mind, and at worst, you’re lowering your ability to reach your financial goals in the short-term and long-term. Match your good intentions with the right direction in your financial life today.
Let’s create a comprehensive financial plan. Call Collin at PCIA of the Ozarks at (417) 720-4255 or email us at pciaozarks@pciawealth.com.
