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KEY019 | Is Retirement Planning A Waste Of Time? by Mind Map: KEY019 | Is Retirement Planning A
Waste Of Time?
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KEY019 | Is Retirement Planning A Waste Of Time?

01 Intro

This is The Key To Retirement Episode 19.

04 In This Edition

In this edition of The Key To Retirement, I'm going to ask and answer the question "Is Retirement Planning A Waste Of Time?"

05 What's New?

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07 Feature Segment

Financial Planning for your future is more than just a good idea, it's a responsibility, and a commitment to achieving your life-long goals.

Retirement planning is a component of a comprehensive financial plan and should not be taken lightly., It can be seen as the glue that keeps everything together., But, the one thing that it isn't - is easy to develop, A retirement plan requires lots of data, A retirement plan requires lots of educated guesses., A retirement plan requires some time to develop., But, the time and effort can be worth it as a result of what gets revealed., It is important to note that a properly developed retirement plan requires a lot of time and data if it is done properly., Use this as a gauge to determine if you feel your retirement plan is worth the paper its been written on., Various studies will show that the vast majority of people who are in or are planning for retirement do not have a written financial plan - let alone a retirement income plan (which is a component of a full plan)., I believe that the main reason for this is that it takes time and effort to complete - assuming you have an idea of what constitutes a complete financial plan., This is a problem that I see all the time., Either denial or a false sense of security., All too often I speak with people who say they have a financial plan., A recent study put out by The Financial Planning Standards Council of Canada found that 70.8% of the people polled who indicated they had a financial plan didn't know that the advisor they were working with was not a licensed financial planner!, How scary is that?, If you haven't spent at least 5 hours of meetings with your financial planner to review all aspects of your financial plan - in the initial year of plan development - you can be pretty sure that you do not have a comprehensive financial plan., If you don't review the following plan components each year - you are not working with a true financial planner., Retirement Plan, Updated annually., Education Plan, Updated annually., Investment Plan, Reviewed Semi-annually., Insurance Plan, Reviewed bi-annually or when a life event takes place., Estate Plan, Updated annually., That's a lot of work - you are best to hire a CFP to work with you on all of this., Another few reasons why a lot of people may feel that planning is a waste of time is..., They don't want to know the realities of what they are on track for., Avoiding the plan means they can avoid having to make some challenging decisions., Not knowing is better than knowing., As life happens, plans that aren't updated become less and less relevant., I had a woman meet with me and she brought with her 5 briefcases., I asked her what was in the briefcases., She said they were her financial plans., I asked her why she had five., She said that the last 5 advisors she worked with each gave her a free one., I asked her when the last time was that she ever reviewed them or brought them up to date., She said the never looked at it again after they were written., This is all too common., Most of us suck at planning, There is a disconnect between people now and their future., This makes it very difficult for people to do any planning when they really have no way of knowing what's in store for them., The solution is both simple and complex at the same time., Simple in that what we need to do is make a best guess at what we anticipate will happen, The complex part is keeping the plan up to date with what actually happened and then making another educated guess at what will happen., This takes effort and time., Have you heard the term KAIZEN?, Do you know what it means?, It is the essence of our financial planning philosophy., KAIZEN is a Japanese term which means "Constant and never ending improvement"., This philosophy is the solution to the problem., If you develop a comprehensive financial plan and then have a systematic approach to keeping this plan up to date, you will find it hard to miss your goal., How do you think an airplane finds the aircraft carrier it needs to land on in the dark?, Constant and never ending improvement., Constant course corrections based on an overriding plan., So, do you know what you want?, Do you know what you're on track for?, The reality is that that sometimes we just don't want to know the truth., But, more often than not, the truth is what sets us free., Thinking about where we want to be makes us realize that we are not there yet. And this can become a bit of a downer., But, by having this discussion with a CFP, the upside is that you are getting to the core of who and where you want to be., Practically speaking, this is a great exercise., It makes us realize that some of our dreams are, well, just that., Being realistic is what will allow us to be more successful in achieving our goals., Being realistic is a choice, A comprehensive financial plan should always be written not in the hope that things will not change along the way but with the true understanding that things most definitely will change., The biggest benefit that KAIZEN Financial Planning brings with it is the understanding that life is more about the journey than the destination., Financial planning is the key, it always has been and always will be.