In this episode of A Wiser Retirement Podcast, Casey Smith and Brad Lyons, CFP® discuss how financial planning looks different in every decade of your life and take a deep dive into the current state of the market.

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SUMMARY:

How Financial Planning Looks Different in Every Decade of Your Life

This next quarter we’re excited to talk about how financial planning should look through each decade of your life. Our newest white paper, “Your Path to a Lifetime of Financial Success” highlights each decade and gives recommendations on what to do financially at each stage. You can click here to download it.

A question that is often brought up is; where am I compared to other people my age? In response to that we like to say it’s not about what you make, it’s about what you have and what you save. We bring this up often, but there is a large difference between being rich and being wealthy. Wealth is having the resources to do what you want, no matter how much you make. Anyone can be wealthy.

This new season really comes down to two things; stay away from debt and don’t chase the Jones’. These are two things that will ultimately steal your joy and limit you from being financially free. When you get to the end of life and look back, you won’t remember the fancy cars or expensive things, but the legacy you leave behind.

20’s Today vs 20’s Twenty Years Ago

There are a lot of things going on in the world today that make it a lot harder for people in their 20’s to start out compared to a few decades ago when we were in our 20’s twenty years ago. The first example is the housing market. Twenty years ago you could put a $2,000 down payment on a house and be a home owner. Today it could be three times that. More people could be forced into renting because of this extreme housing market.

Financial planning is evolving with the times. When twenty year olds come in today, a lot of times it’s because their parents were really bad with money. They don’t want to end up like that so they come to figure it out early. We’ve found that there are so many ways to make life easier and avoid those same mistakes with financial planning.

We are in a Bear Market

When we look at long term trends of the stock market, there is a lot of up and down. It can lead a lot of people to be scared, especially when we enter bear markets. This is why you should never borrow money to invest, and to make sure you’re debt free as you are approaching retirement.

When we work with clients and help them come up with a financial plan, we take bear markets into account. 85% of our clients have come in within the last 12 months to update their plans and we make sure that everyone is on the same page. We make sure that these clients never leave with a plan that is impractical or that we don’t have confidence in.

The Price of Long-Term Investing

In life, everything has a price. The price of long-term market success is uncertainty, agony, regret, and questioning. Long-term investing isn’t about getting rich over night, it’s about waiting it through and playing the long game. You have to remember that these are strange times and the market is unpredictable. You have to trust your plan and your financial planner and weather the storm.

There are no perfect plans for when the market goes down. There are only plans that are less wrong. This is why it is important to always keep an eye on your plan and update it when it needs updating. Just know that the price of investing has an emotional toll sometimes.

There’s No Situation Where Fear Leads to Success

More times than not, fear is not a plan. Fear won’t push you towards success, unless maybe you’re in immanent danger, but when it comes to investing don’t move based on fear. Make sure to have a plan and a purpose.

When you have a plan, make sure your plan has a purpose and goals. Even if your goals don’t result in much, make sure there is a purpose to them. Write you goals down and stick to them. The market will do what it’s going to do. Don’t freak out, stick to your goals, and the market will take care of itself.

Download our white paper on “Your Path to a Lifetime of Financial Success”

TIMESTAMPS:

0:00 Intro

0:40 How Financial Planning Looks Different in Every Decade of Your Life

8:58 20’s Now Vs 20’s Twenty Years Ago

14:00 We are in a Bear Market

18:28 The Price of Long-Term Investing

27:17 There’s No Situation Where Fear Leads to Success

LINKS:

Learn more about Casey Smith and Brad Lyons, CFP.

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Learn more about A Wiser Retirement podcast and access previous episodes.