Over the last few days I’ve had a general chat with three separate people, all employed and earning enough to pay 45% income tax. Very nice! There are some similarities in all three cases:
- They all work extremely hard; in excess of 70 hours a week
- They all travel abroad
- They are all married with family
- They all pay between £80,000-£95,000 a year in income tax
- They all commit large amounts of money to pensions but admit they have no real investment strategy
- They all admit that they could involve their partner more in planning the future
- And the final one: none of them have the time, nor the inclination, to manage their money properly.
So, you would think that each would be ideally suited to financial planning. Yet, they all think they are too young to ‘plan’. They say they just want a bit of guidance and advice for now. They seek reassurance that they are not doing anything wrong and feel no need for anything “more complicated” right now. They are not near retirement and are not close to having to make life changing decisions so, what’s the rush they ask…?
I explained that financial planning is in fact a life changing decision in itself. It opens up a whole new world. Done well, it helps remove anxieties, explore possibilities and create opportunity. Great financial planning delivers action not deliberation and is the key to positivity and excitement about what lies ahead in life. It’s the key to living the life you want.
They all concurred. Utterly understood the sentiment.
The issues came when they realised bespoke financial planning isn’t free. They all work for big companies that offer financial services as part of their employment package, for free. The three people in question therefore view financial advice as a perk rather than a necessity. They really struggle to comprehend paying for it. Yet the cost I quoted was less than the tax they each paid in just one month… and the benefit would last a lifetime!
Bespoke financial planning is about so much more than identifying a pension or ways in which you can reduce tax. It’s about modelling scenarios and considering what action is required to bring scenarios to reality – bespoke financial planning is about forecasting for the life changing things like school fees, weddings, holidays, houses, retirement and so on.
Real financial planning advocates couples exploring their financial environment together to ensure everyone’s hopes and ambitions are understood and tailored for. Only when real thought and discussion is put into it can you ever expect to reap meaningful outcomes and more powerful actions. Bespoke financial planning allows people to build the lives they desire, pushing forward without guilt or fear.
And, in my opinion, that is worth every single penny.