All Things Financial Planning Blog

“We the people, in order to form a more perfect union…” These words, easily recognizable to most of us are found in the preamble to the Constitution of the United States. As I sit here and watch the first State of the Union Address by President Barack Obama, I can’t help but wonder if we will ever achieve a more perfect union or just how far we’ve come since 1787. Clearly none of us were around 223 years ago but I wonder if the framers were as divided as what I am currently watching. President Obama makes a point and only one side stands. To this point we haven’t had a “You Lie!” moment but the discord is pretty clear. So the thought occurs to me, “Can we have a perfect union?” 

Well, I don’t think that having a perfect union is the point and is testament to the wisdom of our founding fathers. I don’t think that is what they had in mind. As I listen to our President and ponder the words from our constitution it all makes a little more sense to me. We can never achieve a perfect union but that does not mean that we stop trying to get better. The financial planning process is no different.

At the beginning of an engagement most planners sit down with the client and go through some sort of discovery process to learn where you are and where you want to go. What are your hopes and dreams for yourself, your family and perhaps your community? Then through varied methods we hopefully arrive at a place where a road map is put together that makes for a smooth journey. While not the sausage-making festival that is our political process, financial planning is very much like our politics in that it is not perfect. We use estimates of future inflation rates, make assumptions about longevity and use other factors that we can never know with certainty. When working with a competent and ethical planner you can feel comfortable that the assumptions and uncertainties baked into the process are reasonable. You will also know that there are no guarantees. In fact, most planners who deliver a written plan will tell you that the plan itself is best suited to be written in pencil because changes will happen.

The financial planning process is just that, a process. We don’t live in a world that stands still. We change. The world around us changes. The decisions we make in regards to our financial lives must change, grow and adapt to our environment. Tonight was a reminder that while I can no more control the course of what happens in Washington than I can out run a speeding bullet, we have to make wise choices based on what we do know. What we can’t do is decide that since we can’t simply set it and forget it or achieve a perfect plan that we stop trying and hope that it gets better by itself.

Lee Baker, CFP®
President
Apex Financial Services
Tucker, GA