By Lisa Bebout, CFP, CTFA, ChFC
Key Private Bank
While financial planning always involves investing, it goes far beyond just building an investment portfolio and selecting investments expected to outperform their peers. At Key Private Bank we believe that to be truly effective, financial planning has to be centered around creating and implementing a long-term strategy to help you achieve your life’s goals.
What is goals-based financial planning?
Goals-based financial planning focuses on identifying and understanding your aspirations and then crafting a plan to help you succeed in achieving them. Together we’ll explore the possibilities and evaluate the trade-offs needed to achieve a desired end, discuss the relative importance of each goal and its cost and then help you come to a conclusion about your priorities. The outcome of this process is a mutually agreed-upon, actionable plan designed to achieve your vision.
You may not have sorted though all of your financial goals, or identified those that are especially important to you. For instance, taking the family out for dinner on the weekends may be a goal that requires you to cut back on other expenses. However, this is short-termgoal, one that is not typically included in a financial plan (although it may be included in developing a family budget). In contrast, long-term goals involve major life events amd targets, such as paying for college, retiing or purchasing a vacation home.
Saving is the mechanism for funding future financial goals that are too large to be included in your regular annual budget without disrupting current personal spending. For exmple, you may be able to pay for college expenses using future earnings, but it could be very difficult given the significant cost and timing .
The goals-based financial planning process
Our approach to planning is interactive; along with your advisor, we ‘ll discuss the impact of your alternatives so that you can be well- informed during the construction and execution of your plan.
This involves:
- Defining each of your goals and then identifying the resources that can be used to help fund those goals.
- Evaluating where you are today, using the current trajectory (current income and savings) to assess the likelihood of meeting your stated goals.
- Determining what kind of adjustments can relistically be made to the plan if it is not possible to accomplish everything you wish. Your financial planner can help you identify which goals you will be able to fund and which resources will be used to pay for those goals .
- Implementing the agreed-upon financial plan, which may require opening up new accounts or making changes in how savings are being directed.
Financial planning is a dynamic process. Individual goals and resources are likely to change over time, and your strategy should be reviewed annually and updated to reflect these developments.
A goals-based financial plan can give you a clearer understanding of your ability to satisfy your hopes and dreams.
About Key Private Bank
We deliver comprehensive, personalized advice to individuals and families that addresses their specific wealth planning needs. We also provide access to a highly credentialed team that is focused on ensuring that each client receives the highest level of service. Working closely with our clients to define their objectives and priorities, we than develop a roadmap to help them reach their goals.
Lisa Bebout, CFP, CTFA, ChFC, Senior Vice President, Senior Relationship Manager, Key Private Bank, 3507 Kyoto Gardens Drive, Suite 100, Palm Beach Gardens, FL 33410.
For more information contact Lisa Bebout at 561-775-6534 or visit key.com/kpb
About Key Private Bank
We deliver comprehensive, personalized advice to individuals and families that addresses their specific wealth planning needs. We also provide access to a highly credentialed team that is focused on ensuring that each client receives the highest level of service. Working closely with our clients to define their objectives and priorities, we than develop a roadmap to help them reach their goals.