Our review process part 1 of 2

As summer approaches our firm has just completed the first half of all annual plan reviews with our clients.  Financial planning continues to evolve and encompasses a wide array of services, needs, and considerations.  It’s been our experience that attempting to review everything once a year, all at one time, may become overwhelming for clients.  This is especially true for those new to the planning process.  We’ve discovered that breaking down the planning process into bite-sized chunks tends to allow individuals and families to get more done now, while making planning more easily managed.

This has led us to complete our annual written plan reviews between the months of January and May.  Here, we cover a number of priorities that support our client’s written financial plan.  Every plan is unique yet many carry similar themes of financial independence, reduced debts, and worry-free cash flow, or “financial plumbing” as we call it.  Updating this plan annually ensures we’re on the right track together and also allows for course corrections where necessary.  Later in the year, from September to December, we’ll cover a completely different agenda of planning priorities that support the above mentioned plan.  This bite-sized approach allows clients to act on what’s important now and also allows us to update forward progress towards long term goals.

It’s not easy to stay the course when so much uncertainty is present everywhere today.  Having a plan in place better prepares you (and more importantly your behavior) so you may act with purpose.  This avoids reacting to what’s taking place around you.  Behavior is often overlooked in planning yet has more of an impact on your real life returns and results than a number of other factors combined.

So what does the Flowerstone Financial review process look like?  Here’s a peek inside our firm and how we serve others.

First, it begins with an updated discovery on what’s going on now.  Updating current needs, employment, housing, cash, debts, income, and new children or grandchildren is paramount in the planning process.  Taking an assessment of your financial and life priorities today, allows for reflection on how far you have come in the process.   Our clients range from young professionals to those who are retired, or as we like to call it, “repurposing their time” enjoying life on their terms.  Having a diverse clientele, with different ages and goals, provides us perspective.  This perspective allows us to continue to learn more about our client’s lifecycles and what they are experiencing.  This builds knowledge and expertise that allows us to share that wisdom with all of our clients.  This is a complete win-win for everyone.

We also like to connect on future fun and happiness topics.  Now, more than ever, we all need to be taking care of ourselves and planning for a little bit of fun.  A lot of our client’s “fun” has been postponed or rescheduled due to Covid-19.  It’s absolutely critical that clients reschedule this fun and other experiences with those they care about.  Too often, financial planning is thought of as saying “no” to all the fun things now and deferring until tomorrow.  This couldn’t be further from the truth, as we see it.  You absolutely must enjoy what you have today and make time for vacations, down time, and hobbies that are helpful to keeping you engaged in life and bring a smile to your face.

We also like to complete a “lifeboat” drill on our client’s plans in the first half of the year.  If you’ve taken a cruise, you know lifeboat drills take place when you are safely tied up to the dock – before you leave the harbor.  You have guidance to arrive at a predetermined spot should an actual emergency happen.  Practicing this, in a safe environment, is completely different than when you are in strong seas, taking on water.  Our annual lifeboat question is “if the market declines 25 percent, what will you do (or not do)?”  I think we all know the answer to that question now!  Not only did we ask this question, but we actually lived through the drill and events of March and April 2020!  Nothing like experiencing a 35 percent decline in price (and value) in your investments to test your belief in planning and your planner!

So, how did you fare as you reflect on your lifeboat drill?  Did you captain the ship through difficult waters or lower yourself in a lifeboat and jettison your plan, planner, and/or both?  Now is a great time to think about this and reflect.

We’ll continue our look into our firm’s review process next time.

Our review process – part 2

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