What if you were to get in an airplane with your spouse, you start up the engine, and he or she asks, “where are we going?” You look to your right and say, “I don’t know! We’re just going to fly aimlessly, in random directions, and hopefully find what we’re looking for and then enjoy it when we get there.”
If there was a passenger in the back seat, what do you think this person would think of your plan?
Unfortunately, this is how most of us plan our financial lives. If you’ve ever felt that you were not making any progress or are confused about money, this could be a good reason why. We fly random headings, maybe even different altitudes, to destinations that are yet to be defined.
I have a framed photograph in my office of an old man sitting in a chair, staring at the camera lens with a confident, yet uncertain look, almost as if he is not quite sure of what to make of his situation. He thinks he’s ok, but he’s not one hundred percent sure. At the bottom of the photograph is a caption that reads, “There are no do-overs in retirement…” It makes a very powerful statement about the need for planning your financial life, especially when it comes to retirement.
Retirement is an event that seems so far away to many of us that we do not see the need to tackle this challenge in the immediate future. We feel this way until it’s right around the corner and then it might be too late. Although we all know we should start today, saving for retirement can always start tomorrow or next paycheck, or even after we upgrade to the left seat or larger equipment.
I believe that the reason why planning for retirement is always put off until later, is because most of us view this as a daunting challenge. Often, it may feel like you need a degree in finance just to even begin. If you listen to the media, I can understand why most of us could feel that way. It seems like the choices are just end-less and we don't want to make the wrong ones. Sounds reasonable, but knowing that we will eventually have to deal with this issue, why not get started now? Because we always have some-thing else that is more pressing right now that can put retirement on the back burner.
If you truly want to attain a comfortable retirement for yourself, you need to make retirement a priority, no matter what age you are. Also keep in mind that the “man” that you work for has no vested interest in looking out for you once you leave his employment.
The key to a successful retirement is to set a goal. I don't just mean set any goal or try to be unrealistic but set a real goal that exactly defines what YOUR retirement ideally would look like. Take a few minutes one day and truly visualize where you want to be. For-get about the opinion that someone might have about your vision or somehow think that it may not be the right one. Remember that this is your retirement and there is no right or wrong answer.
Also, your vision must be vivid, and you should be able to see, hear, and smell every detail. The more vivid this vision is the better. The key is to completely define your vision or goal. After seeing your vision, explore it and try to find ways to break it down into smaller segments or goals that are easier to obtain. Together they should make up your larger goal. Once you have your sub goals defined, place them on a timeline and focus on the first one first, not the second or third. Think of these as a road map that defines the shortest route to where you want to go, and it will keep you from going off course. This will keep you focused and you’ll feel better about smaller attainments along with a sense of progress.
At my firm, we help our clients with this process to give an incentive to get started. Your primary focus should be to have your goal defined and we can help you break it down into manageable steps. It is part of our process, as it should be for any true Wealth Planning firm.
Although the purpose for this article is not to specifically define how to implement this process, it is in-tended to help alleviate some of the challenges that are associated with it. I have found over the years that most have avoided the goal setting process simply because they do not know where to begin and there is also a certain sense of fear of failure. “Pain avoidance is human nature, which is a shame since the pain of repeated failure is incredibly insignificant when measured against the pleasure of ultimate victory” as stated by author Stacey Johnson.
No matter what age you are or what stage you are in your career, financial goal setting is crucial to the successful outcome of your retirement. Whether you do it yourself or you enlist the advice of a Wealth Planner, it is a process that should simply not be avoided. Keep in mind that retirement is different for everyone and we all have different situations. The best thing that you can do for yourself and your family is to set goals today, endure a little bit of pain, and enjoy your life tomorrow along with an exhilarating sense of achievement and personal success.
Alex A. Tapia, AIF ® President and Retirement Wealth Planner Aviation Retirement Strategies, LLC.