If we have annual physicals, why not have annual financials? In the doctor’s office various measurements are checked for good-health – height, weight, blood pressure; and good physicians have a conversation with you about your level of stress and habits to support (or deter) a well-balanced lifestyle. It is the same with your financial life and well-being. There is a reason our profession is called financial planning, and an annual review is a valuable and necessary practice. Our financial systems and personal situations change. While we include all aspects of wealth in our financial check-ins, let’s focus on the exterior measurable finances for a moment.
Financial check-ups are necessary and often missed because there is a misnomer in “Financial Plan.” The correct term would be financial planning. It is dynamic, moving and changing. Too often people say, yes, I have a financial plan rather than, I actively practice financial planning. The former is akin to a three inch binder collecting dust on a shelf. You could substitute financial plan for business plan, marketing plan, or any type of written plan. They all carry the same characteristic: they are accurate for one period in time. When circumstances change, and they always do, what is needed is a dynamic flow to adjust, take stock, set intentions, and take actions that move with a life that evolves.
Financial planning doesn’t require a three inch binder; it requires a high-integrity relationship with a professional (or organization) skilled in meeting you just where you are, and a strong structure from which to engage the relationship in meaningful dialogue and actions. It is a dynamic process that includes periodic check-ins, so that all aspects of your personal and financial life are examined, touched, clarified and adjusted as appropriate for the present situation.
Common areas to review are: taxes, risk management, estate plans, investments, philanthropy, careers, business and education. Every aspect of your life is relevant in the conversation because one aspect always affects another. From and integral perspective, exterior practical actions (e.g. update wills and DNR, Do Not Resuscitate, form) are always infused with, and arise from, interior longings, purpose, and journey (e.g. what is my legacy and how do I want to die.) This is your life, and as physical check-ups are an important part of self-care and protection, financial planning, an evolving process strengthens and optimizes the life you choose to live.
As the months of 2012 amble forward, consider your own situation and an annual financial check-up steeped in intention, clarity and purpose.