By Brittany N. Cox, Associate Advisor at Nestlerode & Loy, Inc.
Our favorite season in Happy Valley is quickly approaching – football season. While social media and the news are flooded with Vegas odds and Heisman candidates, I thought this would be a good time to touch on your financial game plan.
The ultimate goal of any football team is to win and the coaches, including the one I live with, spend countless hours watching game film and studying plays trying to formulate their best strategy. Shouldn’t we also take this approach with our finances? After all, we have goals too, ranging from buying a first home and raising a family, to funding higher education and retirement. Whether your goal is short-term or long-term, you should strategize when it comes to your financial plan.
In the same way that coaches formulate the plans on the field, you should have a financial advisor on your team to help you create your game plan for your finances. You’ll need to create a schedule for the season with a roadmap of all your goals. Your “coach” will be able to help you place these in order and rank them in importance. You should make sure your coach is someone you trust and has your best interests in mind. Your coach will be able to collaborate with the other members of your team as well. This should include your spouse, children, tax advisor, etc.
We are all familiar with teams who are “late starters.” Lackluster in the first two quarters, they come out in the second half of the game finally ready to play. They usually have to overcome a deficit to win the game. Don’t let your financial plan wait until the second half. Planning and saving early has great benefits.
It is increasingly hard for young people to discipline themselves to stash away a portion of their paycheck for a retirement goal that seems so far away. However, that small amount of money has a much greater chance of multiplying if you begin saving as early as possible. Having a solid game plan in your 20s or 30s could make a big difference in how you prioritize and work toward your goals. According to Forbes.com, people in their 20s should have a financial plan to help prevent them from making financial mistakes.
A thought from Forbes that stuck out to me: “The sooner you start making smart decisions, the sooner you know where you want to go, and if you have a plan to get there, the more likely you are to attain it.”
Bonus: the earlier you start, the less you have to save to attain your goal. This rings true for all generations. It is never too late to get in the game and take control of your financial plan.
While just having a financial plan is great, you will need to review it frequently and stay engaged. This way, you’re better prepared for option plays and fumbles. Since these obstacles on the field are sometimes mistakes and sometimes out of the team’s control, the team must have a plan to move forward and pick back up again. Financial plans also suffer setbacks and fumbles from time to time. Coach doesn’t let those go in the locker room at halftime, and neither should you. You’ll need to adjust your financial plan and come up with a new or improved strategy. You will need to review your plan, assess the setback, and adjust your goals. This may mean giving up a few yards, but it offers peace of mind to know where you stand as you work towards your goals.
One final thought: While the Hail Mary is successful on very rare occasions on the field, you shouldn’t rely on your financial plan completing one. You’ll need to work on your plan and make adjustments periodically to make it work. This takes a great deal of dedication and perseverance. Your goals will change as milestones pass, and it’s important to stay in the game and stay the course. Championships aren’t won in one game and goals aren’t met with one plan.
Now get off the bench, go over your financial playbook with your coach and don’t head into the season without a game plan this year.
