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| 2011: Salmon Fishing in the Yemen |
Financial planning is something that I have a real passion for. It is my belief and assertion that when done well, proper financial planning is akin to a light bulb moment or a bit of an epiphany. In essence as a financial planner I address the fundamental question that clients ask (even when it isn't verbalised)... will I run out of money? Proper cash flow modelling admittedly involves lots of assumptions about the future, but these are reasoned, reasonable and reviewed. A financial plan is essentially your lifetime goals, perhaps aspirations, but clear, well defined and thought-through goals. This process can take some time to get right - not because the process is difficult, but because most people simply don't know what they want out of life. American life coaches probably call this "living deliberately" rather than "living by accident". In other words - if you don't have a lifeplan, how can you make good decisions.
The questions can be fairly straight-forward - "Can I afford to buy this house and pay off a mortgage, run it and still afford to live in it when I retire?" or perhaps "I'd like to retire from my job at 60 not 65, but can I afford to do so with all of my commitments?" or "I have worked hard to build my business, what I need to know is what is the sale price I must achieve to do all the things I am working for?". Sometimes the questions are less clear - "Can I afford to start giving money away to my children or will I need it later?" "Can I really afford to spend all this money in my retirement? will it run out?"... "What investment return must my savings and investments achieve as a minimum?"
A great financial plan, will provide answers to the questions that you have thought of and hopefully quite a number that you didn't. Seeing this graphically represented is a very powerful and profound experience, something that enables you to make better decisions and understand why a financial planner is no more interested in financial products than you are - we are interested in solutions.
I attended the preview of "Salmon Fishing In the Yemen" at the weekend, this is a really great "little" British film which seems to capture an aspect of current times. I won't give the plot away, (its well worth seeing with a fantastic cast and director) but in essence stereotyped cultural barriers need to be crossed in order to achieve an ambition. To some, what on the surface seems daft, ludicrous or mad really poses the question - do you understand the vision? not just the "head-stuff" but the "heart-stuff" too? Great financial planning must connect with what's in your heart, not just in your head, after all, we're talking about your life, not a hypothetical one.
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