The same thinking applies to getting financial help. When is the best time to get financial advice? Twenty years ago. When is the next best time? Today.
Seriously, the answer is always earlier is better. The Boomer generation has chosen to mostly wait until 50, 55 or 60 to seek financial help. Their premise was gather financial assets, then get help. Gen X and Y are smarter. They were good students, watching their parents, and they know they don’t want to do it that way. They know, the sooner you get help, the easier it is to reach your goals. They know there are lots of competing choices for their time and money and they know they will make better decisions with help.
If you were given two choices:
- An ordinary life, one filled with financial stress and discord or
- An extraordinary life, one filled with high impact purpose and great memories.
What would you choose?
Seems like a silly question, but for most people they settle for number one mostly because they don’t get the financial help they need and deserve.
Money is the medium of exchange used to acquire virtually everything you need in life, like food, housing, clothing, health care and transportation as well as those things you want like, family experiences and great travel. Money is why you go to work everyday. Money is so important to us that you are willing to take the one commodity in your life that is irreplaceable and limited, time, and exchange it day after day for money. When you waste money, you devalue yourself and the time you sacrificed.
Money isn’t important sometimes, it is always important. It weaves and threads through every facet of your life. Yet you may spend more time planning your vacations than your money.
To help put things in perspective I have taken Stephen Covey’s Four Quadrants, from his classic book, The 7 Habits of Highly Effective People, and adjusted it to focus on money and finance instead of time management.
We will always have quadrant 1, urgent and important matters. They will require our immediate attention and often without notice. However, the more time we spend in quadrant 2, on the not urgent and important, the easier the urgent and important matters can be handled.
When you are in quadrant 1, your activities involve fire fighting and crisis management. When you are in quadrant 2, your activities involve planning, clarifying your values, making clear choices and evaluating options and focusing your money in alignment with your values.
Recently a Fortune 500 executive came in to develop a Prosperity Plan. About two months after completing the first version of his plan, he was offered a buy out agreement as part of global downsizing. This was a big decision, one that had implications for every facet of his life. Because he had a plan, he had invested his energy and time in quadrant 2. He was able to update his plan to consider the buy out in one meeting. He left clear and confident in his decision. His investment in quadrant 2, saved him time and energy and gave him a foundation to solidify his choice when a quadrant 1, the urgent and important matter, was presented.
In addition to “twenty years ago”, when are some other times that paying for quality financial advice always pays off?
In making a college decision, especially one that involves debt. Few eighteen year olds have the financial acumen to clearly understand the consequences of the choices they are making when it comes to college debt. Quadrant 1 decisions made at 18, can keep you in quadrant 1 for a lifetime. Don’t make that mistake, get help instead.
As an entrepreneur starting out. Too few entrepreneurs prioritize financial advice early in their business venture. As a result, they make decisions that cost them dearly down the road. Kind of like a penny saved is a penny earned. A problem avoided is cheaper than a problem created.
If you are making over $120,000 a year family income. Median family income in the US per the Census Bureau is $53,000. At this level you are making more than twice the median income and prosperity planning will help you get clarity about what is important and give you the confidence to take action.
As a couple where one family member makes all the financial decisions for the household. Prosperity planning provides an opportunity to create financial partnership, get everyone on the same page and reduce financial conflict.
As a business owner stuck in quadrant 1. If you are putting out fires and managing crisis, the prosperity planning process creates clarity and focus and gives you the confidence to take action.
As a business owner in transition. If you are within five years of transitioning your business to the next generation, or to an outside party, get help now. You’ll need to be clear on your personal financial plan and how that fits into the business transition plan. Cash flow and tax consequences are driven based on the legal agreements you make. Planning before negotiating and signing agreements is critical.
Now that you know when to get help, let’s talk about how to get help. My experience is that the best advisor is an independent financial planner with a solid background and no hidden agenda. You will know there is no hidden agenda by the way that they charge. If they charge a fee for their work, one that is negotiated above board, that you understand and is in writing, there is no hidden agenda.
Find a planner who spends most of their time and energy with you in quadrant 2. By engaging in a planning process with the planner, one that is ongoing and continuous, you develop clarity about your decisions and gives you confidence in your actions.
Ask about their experience and credentials. Get references. Use your intuition. You know who to trust when you are listening to your inner wisdom.
If you aren’t sure, feel bullied or rushed to make a decision, walk away. A good planner is a lifelong partner in your prosperity. Don’t settle. Keep looking until you have found the right person for you.
The best time to get financial help was twenty years ago. The next best time is today. Start the New Year off right by spending your time and energy in quadrant 2!