Wake up excited about your Future with these Financial Planning strategies


By Steve Lowrie, CFA

Special to the Financial Independence Hub

When people ask me what I do for a living, I sometimes say financial planning. Or investment advice. Or, “I’m a personal financial advisor.”
But none of these descriptors is spot on. As my website says, what I really do is help people wake up excited about life, not worried about money. A key element to this higher calling is to deploy the secrets of simple investing.

Simple investing sounds like a good idea, right? It’s important whether you’re mid-career and all-business, or you’re approaching retirement, with leisure time on your mind. It applies whether you live in bustling Toronto, my hometown of Barrie, or anywhere else in the world. It’s also a familiar theme on my blog, from Why simplicity beats complexity, to “Simple investing isn’t easy,” to “Simple Investing Strategies to Take Away from 2018.”

Still, the secrets of simple investing never grow old and always bear repeating, lest we forget: Your long-term financial goals should drive your financial planning strategies, which should guide your investment portfolio … not the other way around. Or, even more succinctly:

Investment Success = Goals + Planning + Building & Maintaining

This basic equation explains why trend-hungry traders chasing after the latest SPACs, NFTs, etc. are going about it all wrong.

Today, let’s unpack this wise, but simple investing advice.

Simple Investing Step 1: Setting Goals

For most of us, the ability to wake up excited about life, not worried about money means having satisfying goals ahead, and realistic plans for achieving them. No wonder a significant part of what I do as a personal financial advisor is to walk people through the emotional and financial elements of goal-setting.

To achieve your personal short- and long-term financial goals, first, you must have them. And yet, I often see busy families rushing right past this critical first step.

I see it when I ask a 50-something couple about their retirement goals. As each partner shares their ideas, differences often emerge. One may be imagining action-packed days, filled with family gatherings and community service. The other might be dreaming of downsizing to a peaceful country cottage and enjoying more quiet time. Who knew?

I see it in younger families too, as they wrestle with life’s tradeoffs: kids, careers, friends, personal interests, neighborhood organizations, soccer league … How do you do it all without going crazy, broke, or both?

I’ve also seen how the pandemic has put many families’ once-solid long term financial goals into a tailspin, creating a challenge and opportunity to revisit their assumptions. Now what?

Fortunately, the steps to setting long term financial goals successfully are simple enough:

Define and Describe: First, take the time to record your current goals. Go beyond “I want to be rich and famous,” to large and small, near- and long-term specifics. Chances are, you’ll have more goals than time and money to achieve them all. So, estimate the costs involved, assign priorities, and establish approximate timelines for each:

When we retire in 2028, we would like to buy a family cottage near Georgian Bay. But most of all, we’d like to spend more time with the grandkids.

I would like to finish my master’s degree next year. Either way, I really want to be self-employed with my own business by 2025.

Communicate: Talk about your goals as a couple, to discover common ground as well as where you may differ. Identify where and how you might need to find good compromises.

Maintain: Life changes. You change. Periodically revisit your goals and adjust them as needed.

Simple Investing Step 2: Making Plans

With your short- and long- term financial goals in sight, you’re better positioned to wake up enthused about life’s possibilities. The next step is to reduce the worrying. That’s where planning comes in. Clearly, life doesn’t always go as expected! But we must plan anyway, because …

Your plans become your most dependable touchstones against which to adjust your course as needed.

Robust financial planning should embody your personal goals and financial realities. As a personal financial advisor, my aim is to tend to both, so my clients can:

  • Live comfortably, but within their means, by spending less than they make today
  • Invest what they don’t spend today wisely, to fund tomorrow’s dreams
  • Protect what they’ve achieved so far, by insuring against the great unknowns

Admittedly financial planning can be gnarly. Unless you’re a personal financial advisor too, you probably don’t wake up feeling excited about the chance to balance your budget, invest your reserves, select sensible insurance coverage, and figure out how to draw on your reserves once you retire.

In the spirit of simplicity, let’s revisit the point of these tasks:

Financial planning helps you make the most of your money today AND tomorrow.

In other words, by having personalized, practical plans in place, it becomes much easier to know where you stand today, whether you’re on track for tomorrow, and whether you’re as ready as you can be for whatever might happen along the way.

Which brings me to my final simple investing step:

You don’t just need a financial plan. You need ongoing financial planning.

Simple Investing Step 3: Building and Maintaining

Here’s a simple truth: Whether you manage your own money, or you have a personal financial advisor to assist you, a lot can happen between “now” and “then.”

In Your Life: Relationships, careers, interests, and ambitions evolve. Financial windfalls may propel you forward; emergency spending might set you back. Even if you’ve carefully prepared for a big event like retirement, it may not be quite what you imagined once it arrives.

In the Market: Over time, you can expect to build significant wealth by participating in a market’s long-term growth. But in ever-volatile financial markets, you never know what’s going to happen next, or whether the next few months or years will delight or disappoint.

In the World: You don’t need me to inform you that the world never stops spinning. From Toronto to Beijing, for better and worse, breaking news from near and far can wreak havoc on even the most ironclad plans you’ve made for you and your family.

As such, even the strongest financial plan won’t last long without routine care and feeding. That’s what ongoing financial planning is for:

Revisiting Your Financial Goals: Once your goals are in place, you’ll want to check in with them regularly. Personally, what may have changed in your life? Strategically, have your goals remained relevant? Logistically, are you on track as hoped for?

Monitoring Your Investment Success: As I’ve touched on in “How Understanding Statistics Can Make You a Better Investor,” one of the best-kept secrets of simple investing is this: if you avoid getting caught up in whatever fad or panic is tempting you off course today, you’ll increase your odds of earning better, compounding returns over time. A big part of my role as a personal financial advisor is to remind my clients of these simple statistics every time different market sectors surge or sink (which, frankly, is nearly all the time).

Optimizing Your Wealth Management: When’s the last time you’ve reviewed your insurance coverage, estate plans, beneficiary designations, mortgage rates, and all the other interests that contribute to your total wealth? If it’s been a while, you’re not alone. These are the details so often jettisoned along the way to a busy lifetime.

Rediscovering simplicity by taking simple investing steps so we can all be fired up about the Future

Let’s circle back to that question I began with: What do I do for a living?

Hopefully it’s obvious by now, one of my favourite parts of the job is bringing simplicity to other people’s financial complexities. When I’m able to achieve this for my clients, it’s the stuff that causes me to wake up excited about life. As such, one of my personal financial goals is to continue in my career as a personal financial advisor serving busy professionals and families in or near retirement for many years to come. It’s just that simple.

Steve Lowrie holds the CFA designation and has 25 years of experience dealing with individual investors. Before creating Lowrie Financial in 2009, he worked at various Bay Street brokerage firms both as an advisor and in management. “I help investors ignore the Wall and Bay Street hype and hysteria, and focus on what’s best for themselves.” This blog originally appeared on his site on May 19, 2021 and is republished here with permission.

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