The Power of the Financial Plan(ner)


I am a Financial Planner located in the great state of New Jersey (yes, I’ve heard the joke about “which exit”, what else you got?).  Living in New Jersey puts us in a geographic area that is not only hard on the wallet, but also has many, many enticements to spend money on non-essential budget items that would typically fall into the frivolous spending category.  Go to a Yankee game on a Friday night and you’re spending at least $100 per person after ticket, food, parking, and tolls, and then if you decide to chill out on the beach for the weekend, there’s a price of entry just to walk on the sand after paying tolls to get there. Yes, I know we have cheap gas thanks to our lower than usual gas tax, but again, we pay here for the privilege to drive on our highways, which a lot of states know nothing about (right Wisconsin and Texas?)  Regardless, you pile all of the frivolous spending on top of the essential spending, and it doesn’t leave much left. According to  The Tax Foundation, the nation’s leading independent tax policy research organization, New Jersey ranks #2 in the nation in overall state and local tax burden (click HERE for the report). And that doesn’t factor what happens if you die here (NJ is one of two states with both an inheritance and estate tax), so don’t even get me started. Whether it’s Jersey, or anywhere else in the world, expenses abound, leaving you to wonder what happened to all your hard earned cash whenever you view your financial statements.

No matter where you live, a financial plan will help you identify and prioritize your wants, needs and wishes, in contrast to the pitfalls of high expenses and off-budget frivolous spending.  And a Financial Planner (always look for a CERTIFIED FINANCIAL PLANNER™) has special powers that you don’t – the power of objectivity.  Financial Planners are also coaches who will look at your entire situation, help you determine if the emotion you might be assigning to different spending habits is legitimate, and in some cases give you a dose of tough love that you need to fix a situation.

A financial plan might sound very “bougie“, but in reality it’s practical,  and everyone should have one in one form or another no matter how bougie you actually are. The power of the financial plan comes from its mere existence.  It acts as a road map to get you to your destination, or in some cases, that note that you put on the refrigerator to remind yourself not to eat the cake after 8 pm.  Most financial plans will couple your financial goals with a budget, after considering your current situation, and end with specific additional steps you need to take in order to stay on track. It’s a living and breathing document, just like the modern day road maps (aka Google Maps) will adjust if you take a detour, so should your financial plan.  The ultimate power of the Plan(ners) comes into play when you have an objective professional who acts only in your best interests (the Financial Planner), who partners with you to execute your custom financial plan, and uses the financial plan to help you develop the long-term behaviors you need to achieve your goals.