Plan to Achieve Your Personal Financial Goals

By Brent Marchand

What are your financial goals and dreams? Do you know if you are getting closer to those goals or further away? Whether you are saving for a new home, college or retirement - or looking to grow your investment portfolio - having a customized financial plan can help chart a path to your financial future.
Business owners often eat, sleep and breathe their business. However, it's important to have a personal financial plan that is separate from your business plan.
Since business decisions and results ultimately affect your personal financial well-being, the success of your business should be measured by how it helps to achieve long-term personal financial goals. Your financial plan should take into account other personal resources, such as spousal benefits, or potential small business benefit programs that can improve your personal bottom line.
Financial plans come in as many shapes and sizes as people. However, most financial plans answer these basic types of questions (and many more).
- How should I plan for my child's education?
- How can I receive a certain monthly income during retirement?
- What are my retirement investment options?
- Should I assume debt or invest my money?
- How do I reduce my credit card debt?
- How can I provide for my family in the event of death or disability?

Because everyone's financial planning goals are different, there are several types of plans to address individual needs and budgets. Generally speaking, however, there are four main types of financial plans: comprehensive, education/college, retirement and estate.

Comprehensive
Financial Plan
A comprehensive plan is just that - comprehensive. It looks at the big picture, leaving no stone unturned. The plan provides a personal financial needs assessment, current financial summary and recommendations toward meeting your financial objectives. It generally includes things like:
- Net worth calculation
- Cash flow statement and projections
- Income tax estimate
- Investment analysis, asset allocation and recommendations
- Insurance review/recommendations
- Debt and risk management analysis and recommendations
- Education funding alternatives
- Tax planning strategies
- Retirement planning and distribution analysis
- Estate planning and wealth transfer techniques

Education/College Plan
Most parents want the financial freedom to send their children to the college of their choice. Most also know that the cost of college has skyrocketed in recent decades. An education/college plan can help you plan now so the resources are there later when your child reaches college age.
The plan can help you take advantage of scholarships, college savings plans and financial aid, and provide a detailed education funding timeline.

Retirement Plan
Having a comfortable retirement is a goal for the majority us, but how each of us goes about making that happen is often a whole different story. An effective retirement plan must take into account your age, lifestyle, when you want to retire and what you want to achieve in retirement, your current financial situation and long-term financial goals. Retirement plans typically include:
- Current retirement summary and analysis
- Analysis of retirement spending or lump sum requirements
- Review of retirement investment portfolio summary
- Review of employer-provided retirement benefits summary
- Completion of retirement strategy probability analysis
- Completion of retirement distribution projections and suitability
- Projected retirement income tax analysis
- Review of beneficiary designations

Estate Plan
Perhaps the most misunderstood financial plan, estate planning is not just for the rich. If you own property of any kind, you have an estate. An estate plan gives you the power to make decisions while you are alive, instead of leaving it to the state to decide what to do with your assets when you're gone. This plan, also known as a wealth distribution plan, is designed to help you pass along the greatest percentage of wealth to your designated beneficiaries in the most tax-advantageous manner. The plan focuses upon recommended wealth transfer strategies, estate planning documents, ownership options and beneficiary designations.
The best plans come with personal counseling and assistance with implementing and monitoring your plan. Having a plan doesn't help much if you don't stick to it. An experienced Certified Financial Planner (CFP) professional can help you develop a customized financial plan that works with your life and unique financial goals.
It's important to work with an unbiased financial planner who offers advice that suits your individual lifestyle, risk tolerance level and investment goals. As major life events occur, your plan will need to be modified to reflect changes in your financial situation. Your CFP professional will walk alongside you as you strive toward achieving your personal financial goals.

Brett Marchand is the manager of Tower Financial Services, the financial planning and investment management department of Tower Federal Credit Union in Laurel. For more information, call 301-497-7062 or e-mail towerfinancialservices@towerfcu.org.