By Bryan Lee, CFP®, MBA
With more than two decades in the financial services industry, we’ve come across many pieces of sound financial advice. You’ve probably heard some of them as well, such as the importance of living within your means, managing risk, and investing for the future. It would be wise to follow any of those lessons, but if we could give just one piece of financial advice, it would be to avoid procrastination.
It’s all too easy to procrastinate on things that seem painful or complicated. Finances can bring up worry, stress, fear, and other negative emotions. And oftentimes, many people don’t know where to start or what to do. They might not know how to create a spending plan, whether they should pay off or refinance debt, or how much to save for retirement, and it can be difficult to take care of all the details involved in estate planning or retirement planning. Or maybe they’re having difficulty seeing eye to eye with their spouse, partner, or significant other about a particular financial decision. Although you can’t predict what’s to come, there are ways to avoid making the mistakes that get in the way of your growth.
Use Your Time Wisely
What most people don’t realize is that money is far from your most valuable asset, and the same goes for your retirement plan or investment fund. The most important factor in your wealth management process is time and how you spend it preparing for the future. Time is the only asset that you truly never get back.
When you wait too long to contribute to your retirement accounts, you miss out on opportunities. The first is the potential tax savings you might get by funding those retirement accounts, and the second is the compound interest on those contributions over the rest of your working years. Tax planning is an important part of your financial plan, but it is time-sensitive and the rules change from time to time based on legislation. The sooner you discuss your tax situation with a professional and then take the recommended actions, the more money you could potentially save over time, which will help you reach your goals sooner.
Avoid Accumulating Too Much Cash
Saving money is a great way to improve your financial well-being in the long run. Whether you’re saving for retirement or a new car, it’s important to have cash when you need it. However, we often see people stowing away too much of their savings in a regular savings account which typically provides very little interest or potential growth.
Many times, these individuals simply don’t know what they should be investing in outside their company-provided retirement plans, and as a result the cash balances grow over time. By working with an advisor, you can formulate a plan tailored to your goals and needs in order to decide how much cash reserve you actually need or desire, and then invest the rest. There are risks involved in investing that should be discussed with your advisor so you can properly allocate your funds for success among their various account types and investment options.
It’s Never Too Late to Start
As Ferris Bueller wisely said, “life moves pretty fast,” and before we know it, we’re 15 years from retirement. But getting started late is better than not starting at all. Push away the excuses and the temptation to procrastinate and stop losing sleep over your financial future since the sooner changes are made, the less drastic the lifestyle change will likely be. A fiduciary advisor can help you answer your questions and guide you through the process of financial planning.
Additionally, an advisor can help if you’re facing one of these questions:
- Is my spending in line with my income?
- Should I save for retirement or my child’s college tuition?
- What’s my retirement ‘number’?
- How much should I contribute to my 401(k)?
- How should I invest my cash savings?
- How can I help my kids make smart financial decisions?
- How do I gracefully exit my business and not leave money on the table?
- What other items could I be doing that I just don’t know about?
Without proper guidance, you may find yourself putting off the difficult decisions and wasting the time you have left to move forward financially.
We’re Here to Help
So why do a majority of people go it alone on their financial journey? For many, it can be intimidating to share personal financial details with a stranger—especially if you feel you waited too long to seek financial help.
We at Strategic Financial Planning are here to help you get back on your feet, even if you’re feeling drained and full of worry. We’re also here if you need a second look at your existing plan or an entirely new one. Everyone needs a little help and guidance, a road map to their destination—fulfillment of goals—and we want to make it as easy and pain-free as possible. Call (972) 403-1234 or contact us online to set up a complimentary get-acquainted meeting so we can see if we are a good fit!
Bryan Lee is the founder and president of Strategic Financial Planning, Inc., an independent, fee-only financial advisory firm. With more than 27 years of industry experience, Bryan uses a unique client-first financial life planning approach and process to help his clients get the most out of life. Bryan earned his Bachelor of Business Administration in finance and his MBA in international finance from the University of North Texas. He is also a CERTIFIED FINANCIAL PLANNER™ AND CFP®.
Bryan is actively involved in his community and industry and has served on the boards of several associations and charities, including the Dallas/Fort Worth chapter of the Financial Planning Association, the National Association of Personal Financial Advisors, Family Services of Plano, the CITY House, and the Journal of Financial Planning. Bryan has been featured in local and national media, including The Wall Street Journal, Investors Business Daily, CNNfn, USA Today, SmartMoney, Kiplinger’s Personal Finance, Financial Planning Magazine, The Dallas Morning News, and Dow Jones Newswires. And, he has been recognized as a Five Star Wealth Manager and one of Dallas’s Best Financial Planners in D Magazine every year since its inception and recently as a Top Wealth Manager. To learn more about Bryan, connect with him on LinkedIn.