MasterPo says: This blog is about topics and issues that are of importance to me. I am not one of the countless blogging lemmings that are tripping over each other scurrying down the hill and off the cliff of blogging oblivion trying to write the greatest blog on the latest topic de'jour. Your comments are welcome.

October 26, 2008

How Much Is Your Future Worth?

There is the old saying that people (usually) don't plan to fail, they just fail to plan. I have seen this happen too many times not to accept it as nearly a Law of the Universe. I'm not talking about poor plans or bad judgment. I mean no plan at all and not really carrying.

Planning can be tough. It can be a very daunting idea. And frankly it can show a person the subjects they have no knowledge of and make them feel dumb (get over it!!).

So what do you do? Hire someone!

I'm not going to write an article about how to find a financial planner or personal advisor. There are zillions of those out there already
But I am going to tell you this: Good advise costs!

You can spend a lot of time and money buying books on the various subjects, perhaps taking courses and attending workshops (not a bad idea anyway to educate yourself on the subject). But not everyone has that kind of time. And usually you need the help rather quickly. Much sooner than it will take the years to read and learn the subject.

Be aware though: A good financial planner (or estate planning lawyer, CPA accountant, or other life planner/advisor) is going to command a fee for their services. You're paying for getting their education and experience. Why shouldn't someone good be compensated for it? If it was that easy you'd do it yourself!

Above all:

Don't be another Patrick!

Patrick was the 30-something man I wrote about back in August that I worked with who wouldn't even give up one night a week going out to have the money to fund an IRA. Here's a link to that blog article:

After Patrick and I had spoken about his IRA and retirement pipe dream he decided he wanted professional advise for planning his retirement. A very laudable idea. I offered to help him there too. It isn't hard to open an IRA (though with Patrick's requirements it would have been but more on that another time). But he said he wanted someone with more experience. Understandable. I'm not a financial planner. A while later he said he had found a CFP planner in Manhattan and setup an appointment.

Some weeks went by and one day I asked him if he had his meeting with the planner and how it went. "Ridiculous!" he said. Yes, he had his meeting and – oh my stars in Heaven – the planner wanted to actually charge him for a financial plan. Can you imagine that? (that's sarcasm for some of my slower readers.)

Patrick said the planner wanted to charge him $1,000 for a full financial plan. I told him I thought that wasn't an unreasonable fee, especially for a Manhattan CFP (presuming the CFP is well trained and experienced). "All I need to know is where to open an IRA. I don't need a plan!".


I tried to explain to wet-behind-the-ears Patrick that a planner needs to know your entire situation before making any suggestions. And a plan is far more than just an IRA account. There may be other things he suggests you do instead or additionally. And then make that money last after you retire. He's the expert not you!

But naïve Patrick wasn't buying it and didn't go with the plan.

How stupid!

To recap a little: Patrick when I knew him was in his mid-30's and wanted to retire early at 55, 60 the latest, and travel the world. So that means he had another 20-25 years to go until his retirement goal.

You don't think $1,000 now for a professional plan to reach that goal is worth it? That's a mere $40-$50 a year for having a road map of the rest of your financial life in place. Talk about misplaced priorities!

Ultimately Patrick did finally open a mutual fund account (don't know if it was for an IRA or not). At least he claimed to. But that's fodder for a future article.

Don't fail to plan.

Don't be a Patrick!

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