Jim Denton
Oct 14, 2024
The Role of Values in Financial Planning
Knowing your values is just as important as knowing your goals. Financial planning isn’t only about numbers—it’s also about understanding what is important in life. For couples, this means getting to the heart of what matters to each partner. Probing deep into your values helps a financial planner craft a plan that aligns with what you truly believe in, making it more likely that you’ll stick to it. Emotions and feelings often shape these values, and understanding them is key to creating a strategy that reflects what both partners want to achieve together.
Both Spouses Involved in Planning
When it comes to financial planning, having both spouses involved is critical. Having both partners in the room during planning sessions allows for open communication about financial facts and personal feelings. This transparency creates buy-in from both sides, ensuring that each partner feels heard and respected. Hearing what is important to your spouse from their own perspective can deepen understanding between partners and strengthen the overall financial plan.
The Holistic Approach
A good financial plan takes everything into account. Financial planners need to see the full picture to create the best plan possible. This means sharing all financial information with the planner, including every asset and liability, as well as potential future obligations. An essential part of this holistic view is considering income taxes, which can significantly affect your finances. Insurance also plays a vital role, serving to shift risk off of your balance sheet, protecting your wealth in case of unexpected events.
Adapting to Change
Finally, a financial plan should be dynamic and adapt to life’s changes. Job changes, for example, can create new opportunities for better benefits or require adjustments to your plan. Aging is another factor to consider, as health and retirement needs will evolve over time. Major life events, such as moving, retiring, having a baby, or getting married, can also prompt significant updates to your plan. The key to successful financial planning is flexibility, allowing the plan to grow and shift as your life changes.
In conclusion, goal-centered financial planning is about more than just numbers—it’s about aligning your financial goals with your values and adjusting as life happens. By involving both spouses in the process and working with a financial planner who takes a holistic approach, families can create a financial strategy that supports their long-term dreams and secures their financial future.