The Importance of Financial Planning: Why You Need a Strategy

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TRANSCRIPT:

Hey everyone, it’s Tony from Gasima. Hope you’re doing well. I’m here today to talk about having a financial plan. Because if you don’t have a plan, well just that, you don’t have a plan. Now look, I’m not trying to be cute and play on words, but if you’re not planning in one aspect of your life, that’s pretty much a reflection on other things that are going on for you. So there are a lot of things in your life that you plan for, that require intricate amount of details that you have to go through and make big decisions on. Like where to go to school, where to work, if you’re moving, if you’re buying a house, if you are going to pay certain estimated taxes if you’re an entrepreneur, retiring, traveling. We all make major life decisions and critical judgment and strategic planning go along with those decisions. And it’s all better than others.

But crucial decisions in everyone’s life are made and a plan, regardless of how much you thought about it or not, is executed. Now look, as human beings, we naturally tend to spend more time thinking about the fun stuff to plan, like a vacation for instance. But rarely do you go about a plan with as much enthusiasm to go to the dentist or fix a leaky roof. And in our culture, it seems like financial planning is in that same category, with no disrespect to our dentist friends and contractor friends out there. It just actually makes a little sense when you think about it. There’s excitement, suspense, nervousness, fear that comes with making any kind of crucial decision in your life, and finance is one up there. But the point being is that even if you’re going to make major life decisions, shouldn’t you be addressing how to finance those major life decisions if for some reason people like to avoid it? Let me give you an example. During the pandemic, there was a survey run by Schwab, Modern Wealth Survey, and in 2021, if anyone can recall, there was a lot of interest in investing and the stock market had wild gyrations and basically people had more time during lockdown to trade, to look at their financial situations. And when surveyed, out of everyone asked if they had a plan, a written financial plan, only 33% of people in the survey said that they did. And furthermore, almost half of those survey respondents said they didn’t have enough money to make a plan worthwhile or that a plan was too complicated or they didn’t have any time.

Time locked in their home during the pandemic. But they could take up cooking or take up knitting, but they couldn’t look at their finances. Now, naturally, when most people are asked to do the math on small decisions or major life decisions, they don’t want to do it. And they make decisions out of impulse or worse, fear. But that doesn’t ever really ever yield any kind of good results. And so, look, if it’s possible that two-thirds of Americans have no written financial plan, yet they’re going through life constantly making big life decisions, the fact of the matter is, is that they’re conditioned for winging it, for making major life decisions on faith or hope, but not actually being financially conditioned to plan for these major life decisions. But that’s just it.

Faith and hope aren’t plans. They’re faith and hope. And I believe in faith and hope in many aspects. And we put a lot of faith and hope in many fields for where we employ people. So why not do the same thing for financial experts? Well, because a lot of people say, well, I don’t want to deal with a financial advisor because they’re going to sell me something. Look, the reality is, registered investment advisors like myself, like Gasima, are duty-bound, both legally and ethically, to serve the best interests of the client and not to sell them anything that they don’t require. The customer’s needs comes first. The plan comes first. And the truth is that, in reality, most just don’t want to face their finances.

They don’t want to have to look at the hard choices that may be their personal situation. But here’s my question is, why does it have to be looked at in a negative context? Why don’t people get excited about the possibility of getting a plan together and sticking to it and having lifestyle choices that they want get financed properly without any worry. Why not be happy and in love with your finances as opposed to angry and frustrated? And you know the truth of the matter is these things are complicated much like any relationship in your life because that’s essentially what we’re talking about here. We’re talking about your relationship with your finances. And as we know relationships can be emotional and turbulent. Sometimes you’re angry sometimes you’re in love. But at the end of the day if it’s a relationship worth fighting for, which obviously your finances are, then you need to manage that relationship. You need to cultivate that relationship. You need to tend to that relationship. And here’s kind of where the mother meets the road on do you need a plan. Everybody has a relationship, whether they’re deep or superficial, so you need to have a relationship with your money. You need to have a relationship, you need to have a plan with your finances.

And in today’s world, there’s plenty of things that don’t give us a lot of immediate satisfaction, but we know they’re good in the long run. I mean that could be said about the no pain, no gain of weight loss, for example. I mean, take my advice, I’m not using it, look at me. I’m always using excuses like, oh, I haven’t been able to get the weight off because I’m having trouble getting back to the gym. Or I give people excuses like, oh, I’m traveling. But look, the fact of the matter is, when I’m up in weight and I’m not eating properly, it’s because I’ve lost my relationship with weight and my diet. Now, wait a second, let’s stop talking about myself. I know I got to hit the gym, but my point is that there are some that need to motivate, some that need a little extra inspiration, or there are some that don’t, there are some that like doing it themselves. There’s a huge place for people like that in personal finance, and that is a plan. Of course, there’s the other extreme, there’s those like myself who don’t even know how to swing a hammer, can’t spread mulch in their yard, and absolutely can’t stand going to the DIY stores like Home Depot or Lowe’s. Clearly, those are the people that need help, they need a plan, and they need to actually employ some type of people to get that help. It’s kind of like that dentist example I said before, you may not like planning that appointment, but if you need a tooth removed, you don’t do it yourself, you go to the dentist. That’s where someone like us could fit in. So, hope that you get a plan together.

I hope you start being forward-thinking, help you manage your relationship with your money, and stop operating without a plan. So give us a call here at Gasima, and let us help you get advice, strategy, investment management, and achieve your goals.

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