A Financial Planning Story

In a recent newsletter I shared a personal story about how financial planning has informed a decision.  A lot of readers responded positively so I am sharing it here. Let me know what you think.  Do you have a story about how financial planning impacted you?

     Recently, my wife and I were making a significant financial decision. We had been looking at making a large purchase, the largest of our lives.  It has been on the radar for a while and the time had seemingly come.  We had many conversations. We talked about what we wanted, what we hoped for, what could be. 

    As you might expect, I ran numbers and we revisited our own financial plan.  We looked again at our financial goals, some of which had changed, some which had become more acute.  I ran various scenarios to model the consequence of such a purchase.  I talked to others both financial experts and trusted loved ones to ensure my interpretations were not overly emotional.   

    Together we wondered, how could such a purchase impact our retirement security? What about our current cash flow?  Would the need to finance the purchase cause us undue stress?  Could we continue to save for the kid's college?  How does it impact our charitable intentions? The questions rained down unrelentingly.  

   These are not easy questions, but the answers we give them are important.  Once again we found ourselves going through the financial planning process, not for the first time mind you, but here we were. Again clarifying our values, revisiting our goals, measuring our progress and letting those things help guide us in our decision making.  

   The numbers, while not a slam dunk, were positive.  We could do it. We talked some more.  Numbers are not life.  We recognized the role that emotions and desire were playing.  Together we considered risk, stress, health, the kids, the future. 

     We made an offer, uneasy, but buoyed confident by the a couple of months of running projections.  I pressed send, the email sent, the offer made, and then we waited. 

    I share this with you because I was reminded why financial planning is important. It is a dynamic, unending process, one stretching well beyond investments and returns. In fact, it could be argued that divorced from one's plan, returns are nothing more than numbers anyway.                

    Financial planning is life and the acknowledgment in life we have to make financial decisions.  It is about making intentional choices. It is about being proactive so when opportunities come along we can take advantage of those opportunities.  It is being moored to something and not cut adrift in ceaseless seas beckoning for our consumption. It is waiting, as well, the practice of patience.

Financial planning is not about guarantees it is about possibilities. 

     I was grateful. We learned alot about us as a couple.  We marveled at how our situation had changed over the course of our marriage.  We recognized such a purchase would have been impossible to even imagine just a few years back. It wasn't income that changed things, it was years of making small choices, putting way small amounts, avoiding debt, and doing those things over and over and over.  

    I now had demonstrative proof that planning matters. It wasn't about investments, or insurance but rather intention. In this area (financially), we had acted responsibly and making that offer was testament to our efforts and sacrifice.  

    The offer was rejected.  Financial planning is not about guarantees it is about possibilities.  We didn't fight back.  We are okay with that decision.  While we didn't get what we wanted or could afford.  We were more confident. Confident that whatever disappointments life may bring we are better equipped to face them.