Why do Financial Plans Succeed? Why do Financial Plans Fail?

Just as bridges and buildings need strong foundations and thoughtful design to withstand the forces of nature, financial plans require robust strategies and careful construction to endure the test of time and economic variability.

But before you get going several key questions need to be addressed, including:

• What causes some financial plans to thrive while others falter?
• How should financial plans be structured in the face of economic turbulence or market volatility?
• What are some of the external pressures that can threaten their stability?

Finance, much like physics, can explain the dynamics of our economic environment when we understand how to analyse it. For example:

• An investment portfolio is a balance of risk and return;
• A budget can be viewed as a framework to control financial forces;
• Insurance is a strategy to mitigate against unforeseeable disaster;
• Retirement planning showcases the power of compounding and growth;
• Tax strategies reveal the importance of efficiency and optimization;
• Estate planning is the careful consideration of legacy and transfer.

All of which are key components of an effective financial plan just as the brakes, steering, suspension, chassis, engine and gearbox are key components in a car. Without any one of them you have a poor, if not downright dangerous car. It’s the same with a financial plan – miss or ignore a key component and you are well set to fail.

Our work together will equip you with the tools to navigate these critical aspects of your financial well-being. In time you will learn, understand and appreciate these fundamental principles of financial planning.