Financial Planning Is Not…

A lot has been written about what financial planning is. Everything from who could benefit from a financial plan, the process, the types of problems that can be solved has been talked about over and over. There are still misconceptions out there about financial planning, and this is one financial planner’s perspective on what financial planning is not.


Financial planning is not budgeting. At least it’s never just budgeting. Anyone with an excel spreadsheet or Mint account can figure out how much they are spending and set a budget. For some clients financial planning may involve budgeting and for some it may not, but financial planning is always deeper than just a simple household budget.

Cash flow analysis is always a part of financial plans that I develop for clients and this is similar to a budget. However, cash flow is more about taking a look at how much money is coming in, and how much is going out annually. It’s more big picture than budgeting and there may be suggestions that I can make to improve your cash flow. What I won’t say are things like “you spent $10 too much at Starbucks last week”. You won’t hear that because planning is non-judgmental. I am looking for bigger changes that will actually make an impact 5, 10, 25 years down the road.

Budgeting can be a part of a financial plan, but a financial plan is not a budget. It’s much bigger than that. I can give you suggestions on how to pull back your spending if that is necessary, but your Starbucks habit is probably not the problem or the solution.

Bluffton Financial Planner

Depriving Yourself

I am not going to tell you that you cannot spend your money on a two-week trip to Hawaii. I am not going to tell you that you can’t grab a drink after work with your friends. I am not going to tell you that you can’t buy a new golf club, hand bag, or hit up Pure Barre twice a week. It is up to you to decide what is most important to you and it is up to me to figure out how to make that happen, within reason. This does not mean that you can just spend without regard to how much money you have. You may have to make choices, but I will not make those choices for you or judge you for any choices that you make when it comes to spending your own money. Treat yo self.

If you have a goal to take a month off from work and travel across Europe, awesome! You can do that. Let’s make a plan, track your progress and when you get back from your trip grab a beer because I want to hear all about it! Big or small, far in the future or just a few months away, whatever your goals are I can help you get there, or if it’s unrealistic we will reevaluate together and figure out what works.

Bluffton Financial Planner

All About Retirement Planning

Financial planning is not just a retirement plan. Of course, for almost everyone retirement is a goal and for younger people it’s a goal that is very far in the distance. From a planning and investment perspective this is a good thing, but planning and saving only for a goal that is 30 or more years away can feel like a grind. Yes, you need to plan for retirement. No, it does not need to be the only thing you are working toward.

In fact, I would urge clients to avoid making this their only goal. If you have your debt under control, a solid emergency fund and you are saving for retirement, it’s definitely time to start enjoying your money in the near term. You have to enjoy today just as much as you will enjoy retirement. The truth is you may never make it to retirement, so you have to live a little bit today as well and financial planning can help you do that without sacrificing longer term goals. You need to enjoy your entire life, not just retirement.

Think about how many times in a month or a week you touch your money. How many times over the last year you have encountered a major money event? For example, maybe you changed jobs, bought a car, paid off credit card debt, got a raise or a new employer benefit. These are all things that have an impact on your financial life and require financial planning.

Only for the Super Wealthy

People tell me all the time that they don’t have enough wealth to need financial planning. While it’s true that you probably do need a certain amount of income or wealth to afford a financial planner, it is not something that is just for a very rich. In fact, people with endless amount of money probably don’t need to worry about their financial plan – they are set. It’s those people that fall somewhere in the middle that benefit the most.

If you have a limited amount of money financial missteps will have a bigger impact on you that someone who is uber rich. For example, if you do not carry enough liability insurance and you are sued because someone is hurt on your property this will have a much larger impact on someone who has a net worth of $500,000 than it will on someone with a multi-million-dollar trust fund coming their way. Financial planners help people avoid making mistakes that can cost them, it’s wise to have a professional that keeping tabs on your finances. Money is important after all.

Bluffton Investment Advisor

So, what is Financial Planning About?

To me, financial planning is taking control of your money. It is being proactive rather than reactive with your finances. Money is not scary once you understand it and have a plan, especially if you can find someone that you trust to give you advice and help you along the way. You don’t have to figure it out on your own and financial planning does not have to be rigid, stuffy and boring. As a financial planner I am always going to make sure my clients have the basics covered, but once we have a solid foundation we can always plan for some fun.


-Jenn Sokolowski