Explore strategies for couples to align financial goals, plan for shared expenses, and manage investments together.
1- Individual & Shared Goals
Our topic for today is, "Love and Money: Building Financial Harmony with Your Partner." The first step in this process is to not only identify individual goals, but shared overall goals. This may sound complex and time-consuming, but it is important because without goals, how do we know what we are working towards? How do we achieve each of our objectives individually and as a couple? Many of us would like to retire at some point, but when do I? When do we? What will we do? These are important questions to ask due to how the topic of money is not always easy between couples. I often find, when working with couples that common ground can be found when topics are discussed and when a 3rd party is involved. Important to remember that this is a process and not a one time event.
2- Assess Your Goals
In this part we look at your current situation to determine what are your assets and what are your liabilities. It's important for both parties to have the knowledge of what is there and where it is held just in case of death. Your assets may include bank accounts, retirement accounts (previous and current job), education accounts, annuities, life insurance, real estate, and personal possessions. Liabilities would be anything such as mortgage, loans, debts. It's important to discuss each others differences when it comes to saving and spending. Best advice that I was given was to have an option C if option A or option B is too one-sided. The goal is to be able to come together at the end even with individual goals incorporated into the plan. A good holistic planner accounts for all of these together.
3- Develop and implement the plan
This is where it gets fun, right? Don't worry, I often find positives and common ground to incorporate both partners goals. This is where expertise and software come together to project scenario's and what if's. If this happens, are we protected? What will our income be in retirement? Income, just happens to be one of our core beliefs that income should be accounted for to avoid uncertainty. We can make future estimations of taxation, and when to take social security benefits. If we have a business to sell, what is a good valuation? Will we downsize? Will we travel? What about medical expenditures? The goal is to account for these scenarios through stress testing of various market conditions to verify if goals are obtainable.
4- Monitor Progress
We've put together a plan, put it in motion, and everything seems to be going smoothly. We're done right? Nope, not quite. This is where even the best drawn up plans can fail because…There was no revisiting of the plan that was set in motion. Did our situation change? Did the world we live in change? How quickly things can change even over the course of a year. This is why we ask to meet with you, so that we can not only catch up but to make sure we are still on track. So that if our goals change or the world we live in changes, that the plan accounts for these changes or is modified so that it is applicable to current needs. Hopefully you have enjoyed this series and as always reach out, we're here to help.
Matthew McCormick is a Registered Representative and Investment Adviser Representative of/and securities and investment advisory services are offered solely by Equity Services, Inc. (ESI), Member FINRA/SIPC,1 N. Franklin St., Suite 3450, Chicago, IL 60606, 312-236-2500. In CO, MO, NH and WI, ESI operates as Vermont Equity Services, Inc. Weyers McKeever Financial Partners is independent of ESI.
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