This Insights article is contributed by Kayla Williford Johnson, Financial Planning Associate at Pathfinder Wealth Consulting. This is the first post in a two-part series on the importance of a financial plan to your long-term financial success.
 
Many of us want to better our families, relationships, health, and careers. When we want to improve our parenting, we read books, set a plan with our spouse, and talk with other parents. Same with our friendships and marriages. When we want to improve our health, we research, get friends to join us and hold us accountable, and set a plan for success. Same with our careers.  
 
When it comes to our financial futures, success comes from careful planning, with help and accountability.
 
It is well-known that most Americans live paycheck-to-paycheck. It is so extreme that in the most recent government shutdown, over half of Americans would not be able to afford a $1,000 emergency. Furthermore, a national survey by the Financial Educators Council found that one out of every three respondents reported losing $15,000 over their lifetime because of their lack of financial knowledge. In 2018, respondents reported that financial illiteracy cost them $1,230 on average. This figure has increased each year since 2017 and nearly 20 percent of them reported losses of $2,500 or more because of a lack of financial knowledge.

No one wants to live in financial chaos, but many do because they fail to plan. The antidote to poor health, struggling relationships, and chaotic finances is all the same — a commitment to a plan.

A study conducted by the CFP and CFA Boards showed that people who have a plan for all areas of their financial life save more, are more financially secure and prepared, have adequately managed their financial risks, and experience confidence over their money — regardless of their income level. Everyone needs a financial plan, whether you are just getting started on your financial path or you are a seasoned investor. By creating a plan, you are controlling your money and using your dollars for your purposes, goals, and dreams. Money can help create the life you want to life, but you must have a plan.  
 
Many people want to know when they need a financial plan. The best time to create a financial plan is yesterday; the second-best time is today. Financial plans are like physicals — a financial check-up. They are great for giving you peace of mind that you’re on a path to success and they can tell you if you’re financially ill and can help steer you in a better direction. There are, however, some major life events that should prompt you to establish or update a financial plan:

1. Retirement
2. Claiming Social Security
3. Marriage
4. Birth of a child
5. Divorce
6. Death of your spouse
7. Receiving an inheritance
8. Starting a business; buying or selling a business
9. Career changes

Many people who have money in the bank and are saving are tempted to think they have no need for a financial plan. In our opinion, this is akin to a healthy person claiming that they don’t need to visit their doctor. Financial plans, and more specifically, monitoring one’s financial plan, ensures that you are financial healthy for the long-term. It’s your financial preventative medicine.
 
If you are ready to dive deeper into financial planning and the security it may bring to your financial future, please give us a call at 910-793-0616 or visit our website at www.pwcpath.com.

4018 Oleander Dr, Suite 102, Wilmington, NC 28403 | 910.793.0616 office | 910.793.0617 fax | www.pwcpath.com

Advisory services offered through Commonwealth Financial Network®, a Registered Investment Adviser.

Jason Wheeler is currently the CEO and a Wealth Consultant at Pathfinder Wealth Consulting. Pathfinder specializes in comprehensive financial, estate and tax planning services, investment management, and risk management (insurance) for business owners and successful executives. Jason Wheeler offers securities and advisory services through Commonwealth Financial Network®. Member FINRA, SIPC, a Registered Investment Adviser. To learn more about Pathfinder Wealth Consulting, visit www.pwcpath.com. Jason can be reached at [email protected] or 910-793-0616.