My Financial Planning Philosophies
9 Principles that underpin my approach and ethos with helping clients.
What follows is a brief description of what you might call the ‘first principles’; the foundational bedrock I operate from as a planner. They are not perfect or even necessarily the best ones in existence however, I feel they serve me well and help me service clients well. Take them as you will.
If they resonate with you, let’s chat. If they don’t that is ok. Best of luck with your search for a planner that suits you. I may be able to provide you with some referral names if you would like. Please let me know.
As I see my role in assisting clients in essence, boils down to 3 key actions:
- Help clients have the choice to retire at the age they want
- Help clients afford the retirement lifestyle they want
- Help clients avoid relying on the age pension
In working to achieve this, I operate from the following principles / philosophies:
1. Mutual trust & respect
If we do not like each other it will not work, let’s call it a day before we waste each other’s time. If there is no trust, we cannot possibly have a sustained, successful planner-client relationship. This is the bedrock principle all others are built upon.
2. Primacy of the Plan
The plan drives everything we do and how we interact; through the plan. We do not speculate, we do not punt. We invest according to a specific plan, expressly driven to achieve clear, measurable objectives.
3. Money is purchasing power
Inflation kills purchasing power over the long term. It’s the culprit behind an eroding quality of life, financially speaking. It is the primary issue retirees and would-be retirees need to provision for.
4. Shares – owning a piece of the profits
Owning part of the great companies of the world has over the long-term been a more profitable approach than loaning to them.
5. No free lunch
Owning shares and receiving the long term benefit comes at a price – unpredictable and often rapid changes in short term prices. When you pray for rain, you have to be prepared for some mud.
6. Investor behaviour matters far more than investment returns
“We have met the enemy and he is us” – Pogo. Our behaviour and what we do with our money is the single biggest influence on our long term outcomes, even ahead of what the share market does.
7. Futility of prediction
We all eventually learn the market cannot be reliably predicted much less timed. It’s just a matter of how much money and how long do we want to spend before realising this.
8. Optimism is the only realism
It sure doesn’t feel like it sometimes but in aggregate, the world moves onward and upward with breathtaking resilience; and there will always be enterprising companies to capture the profits from doing so. Understanding this and taking advantage of it in the face of unrelenting bad news is the hard part.
9. Work the plan… and then keep working it
The best laid plans count for nothing if you do not stick to them. Staying on track is just as, if not more important than getting on track in the first place.