April 22nd, 2024 | 1:30PM MST
Written By: Teresa Milner | Senior Wealth Management Advisor with Pearl Capital Management

The key to finding financial peace of mind begins with putting yourself first. First, you must take the time to cultivate a sense of security and stability; this will minimize the fear of the unknown. Rather than waiting until life presents unexpected challenges, such as job loss, health issues, or inheritance – proactive financial planning empowers you to navigate these situations confidently. With proper planning, you ensure you are well-prepared for whatever obstacles life may bring.

There are 3 main barriers that often get in the way of planning for your financial future:

1. Procrastination – It is easy to delay financial planning when you do not feel any immediate impact. You simply do not want to do it, so you end up putting it off and avoiding it.
2. Inertia – Feeling stuck or not wanting to change makes it easier to stick with the status quo. You wait for an outside force to push you to take action.
3. Fear – When you are unsure about what to do, you end up stuck with analysis paralysis. The end result being nothing is done out of fear of making a mistake.

It does not take a lot of time or effort to lay the foundation for your financial health, but it makes a big difference in the long run.  Set goals for yourself and then take the small actions needed today to achieve them.

Tips to help you overcome the barriers of where to start with your personal financial planning:

1. Define specific and clear financial goals for 1, 3, 5, & 10+ years
   • • • Saving 20% for a down payment on your next property purchase
       • Taking a family vacation to [specific destination] in [number] months
       • Retiring at age [xx] with an annual income of [$xxx.xx]
         • • A basic rule of thumb is the 4% rule, which states you can successfully withdraw 4% from your savings annually in retirement while maintaining an adequate balance.
           • This can be calculated by taking the annual income needed and dividing by 4% (0.04).
2. Educate yourself and learn basic financial concepts
   • • • Saving Concepts
         • • What is the “pay yourself first” method?
           • What is a bucket-saving plan?
           • What are the differences between qualified and nonqualified accounts?
       • Budgeting fundamentals
         • • How to track your cash flow
           • What is needed to move from the accumulation phase to the distribution phase
       • The tax impacts associated with your financial plan
         • • Track your tax bracket over time
           • Learn the most tax-efficient way to prepare for retirement
           • Maintain a retirement tax plan
3. Find an accountability partner
   • • • Share your goals with a friend, family member or partner
       • Discuss the progress as well as the challenges you encounter
       • Learn from each other’s mistakes – they happen.
4. Seek professional guidance
   • • • Consider consulting a financial advisor who can help guide you through new challenges.
       • An advisor can help assess your finances, provide personalized advice, and guide you in creating a comprehensive plan to help you achieve your goals.

Financial planning is a dynamic ongoing process that requires adapting to the changes in your life. Effective financial planning can have a profound impact on your long-term financial security, and it lays the groundwork for achieving your financial goals and building wealth over time. When you decide to take the initial step, no matter how small, you set the wheels in motion toward a financially secure future.

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At 17 Capital Partners & Pearl Capital Management, our expertise lies in investment management and financial planning. We’re committed to crafting robust strategies for your financial future.

This content is for informational purposes only and should not be considered as tax, investment, or legal advice. Always consult with a qualified professional for personalized guidance.