At this time of year, our thoughts turn to making plans for next year. In business, we make budgets and forecasts. In our personal lives, we make resolutions. While exercising more and losing weight are commendable resolutions, they aren’t the types that lead to purposeful thoughts and activities, the kind needed for living the life we want.
Financial advisors and financial planners can help you move in the right direction. When framing these conversations in terms of savings and investments they provide a valuable service because money is important. It gives you choice and serves as a vehicle for navigating where you want to go in life.
Unfortunately, conversations about money that focus on replacing investments, insurance policies, or debts are not enough. They fail to capture the big picture, long-term and holistic perspectives that guide you to where you want to go.
What follows are three steps that should serve to guide you towards the big picture and living the life you want.
STEP 1: Balance Personal Finance with Pursuits of Personal Fulfillment
Leading advisors go above and beyond what others offer to help their clients balance personal finance with other pursuits of personal fulfillment. Mitch Anthony, author of The New Retirementality and Life-Centered Planning, describes the pursuit of personal fulfillment as “return on life” or ROL. He defines ROL as “How well you are doing in living the life you want, with the money you have” and lists key ROL indicators, including:
· Living well within your means
· Investing time, energy, and resources in people and engagements that energize you
· Allowing yourself to have experiences and fulfillment whenever possible
· Not comparing yourself to others who may live with a different set of circumstances
· Living purposefully
· Not allowing your identity to be defined by numbers
The best financial conversation you will ever have is to ask yourself, “Who and what really makes me happy in life?” I encourage you to arrange your finances to keep those people and experiences front and center in your life.
STEP 2: Plan Retirement as a Stage in Life, Not an Economic Cliff
One profound example of return on life is the approach you take to retirement. Rather than viewing it as an economic cliff that you jump from once you’re in your 60s, you can see it as another stage that is just as challenging and enjoyable as any other stage. In this stage, your ROL indicators might include:
· How you best spend your time and energy
· How you address your personal health and well-being
· How you continue to challenge yourself
· The role you play in your parents’ and/or children’s futures
· The kind of legacy you want to leave
· Your definition of success
STEP 3: Develop a Plan for Living the Life You Want
Coming full circle, we return to the value of financial planning. Planning for return on life is more than moving pieces. This type of planning involves understanding the impact of money on every area of your life. By engaging in a financial planning process focused on what’s happening in your life – adjusted financially to facilitate those happenings – your advisor can help you reach the ultimate goal of using your money to live the life you want.
To help you get started, I recommend that you start the new year with the following resolution:
During 2019, I will engage in a plan for living the life I want!
I hope you find this helpful and welcome the opportunity to help you with your resolution.
As always, please share this information with someone who might be in need of financial advice. Let them know I will be happy to meet with them and, at no cost or obligation, provide a 2nd opinion on how they can live the life they want.