Personal Financial Planning

Having trouble sticking to your financial plan? Try taking it personally.

“Gee, honey, let’s build a financial plan this weekend” has never been said in an enthusiastic tone by any woman I know. If you look at most of the standard plans in the industry, the emphasis is on dry numbers: projected inflation rates, expected returns and the final dollar amount needed at retirement. But does having a financial objective actually drive us to stick to our plan? My global research has shown that smart women are usually more motivated by causes and concerns that matter to them on a personal level.

Most of the posts you read about ‘value’ investing are about buying certain types of stocks that trade at low multiples. But personal ‘values’ can also be part of a financial plan, and allow us to have a better financial focus. Here are a few examples.

Judy from London, England said: “I retired after selling a successful clothing business a few years ago. After spending some time on fun and games, it didn’t take me long to realize that I missed having a reason to get up in the morning. I recently bought another company and I am passionate about both the product (fabrics) as well as the act of being involved in the day-to-day running of a business. It is exciting to meet new challenges – I would never have bet ten years ago that I would one day go on QVC to sell bed linens! Retirement is not for me. Now I see my sixties as just another great phase in life.”

Judy’s Financial Value Statement: Pour my time, energy and money into my business – this offers me challenge and excitement!

Pia from Stockholm: “I spend my time on two things – my family and my job – in that order of priority. I make sure to combine my own interests with time spent with my family. For example I go to the gym with my 14 year old son, I discuss business issues with my husband who is my mentor, and I get most of my ideas while traveling around the world on our vacations when my mind is free to think. Why is my family my #1 priority? To me it is pretty easy. This is the place where I not only give my energy but it is also the place where I get my energy, balance and passion for life.”

Pia’s Financial Value Statement: Put my family first and arrange my business life around them. Be free to come and go as I please!

Jodi is a CEO in the Toronto area: “I go to bed every night and think about how I can make a difference in the world. I started Real Tech in 2004 – we develop technology innovations that provide practical water quality solutions. All of my time and energy is spent on Real Tech because I truly believe we all need to do more to improve the world. It really is possible to create something out of nothing and I now see the direct effects of my efforts to minimize the formation of carcinogenic drinking water. I have two small children and I’m proud to tell them that mommy has to go to work today to make safe water! ”

Jodi’s Financial Value Statement: Pour my resources into saving the world and make my kids proud of my work!

Financial success is more attainable when you are clear on what the money is for and why it matters so much. Why not state your values at the forefront of your financial plan?