Money you accumulate can work like an orchard, and the income—the fruit crop—helps run retirement life. Some in the industry would call clients taking out their own money “attrition.” Attrition, per the dictionary: “loss or destruction, corrosion, waste.” But to us, it’s simply investing wisely, spending well. Attrition, shmattrition.
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Trying to lose weight? Maybe you could focus on exercise, on diet, or on a combination of factors.
Trying to repair something around the house? Maybe you could watch a tutorial and try your hand at it, or maybe you could hire out the work.
But which way should you do it?
The thrilling answer for many of life’s challenges and goals is that it depends. Lots of paths can lead to success. When we work with you, our clients, on your financial challenges and goals, the same is true.
It depends. That’s why we’re here to work with you, wherever you are in your process.
Telling people what they “should” do with their money seems, to us, kind of gross. And we don’t want anyone to “should” all over you!
I first heard this advice years ago from speaker and author Amy Florian, and it has roots with German theorist Karen Horney who talked about the “tyranny of the shoulds”: if we get too wrapped up with what we imagine what we “should” be doing, we lose sight of what we have and what’s within our control.
The idea comes to mind whenever I read or hear some supposed expert on whether you “should” pay off your mortgage early or “should” retire at a certain age or “should” do anything. (I believe, quite often it comes from financial planners who seem to think they’ve been ordained to tell people how to live.)
We think the first priority when you engage us on any issue is to outline the range of possibilities; then we can look together at the options and their ramifications. We’ll tell you what we think, but we will not tell you what to do.
It is your money, your choice. What will help you sleep easy each night? What dreams are worth pursuing each day?
So what “should” you do? Well, we’d gently recommend that you not let anybody “should” all over you!
Clients, let us know when we can help you address any of those “should” type of questions you may have.
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The object of planning is to figure out your primary aim or goals in life, and what you need to do to get there. The habit of rethinking these things from time to time and assessing your progress keeps you on track.
It is helpful to think in terms of narrative – stories – that describe what you are thinking about. For example, if your story involves retiring to a home in the mountains, your life between now and then will be shaped by that goal. You might vacation in your intended destination, get a feel for the lifestyle, the real estate market, activities, how your life might look in retirement. The narrative may motivate you to do what you need to do to make it a reality some day.
No matter how distant your goal, you’ll be better off if you know how much wealth you might need to get where you want to go. So there is some arithmetic and financial planning to do.
Getting down to details, we think there are several broad categories that need attention in a comprehensive plan. People are better off when they think about and manage:
• Human capital, or earning power, and careers.
• Investing wisely, managing financial assets.
• Spending well, managing the budget and liabilities.
• Residential plans, where do you want to wake up every day?
• Educational funding plans for children or other relatives.
• Retirement intentions.
• Exposures to loss.
In subsequent letters, we will get down to details in each of these areas. Clients, if you would like to talk about this or anything else, please email us or call.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
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