Why Financial Planning is More of an Art than a Science
Every stage of life has some bearing on a financial plan. As a Certified Financial Planner™, in addition to being a Certified Public Accountant, I am governed by high standards in my profession to help people meet their financial goals and to have access to competent and ethical financial planning advice.
Financial planning is more of an art than a science. Each plan must be specific and individualized to each person’s own specific personal situation.
With the way fear is promoted in our society and in the media, many times financial planning includes just holding someone’s hand and helping them to keep focused on the goal and reminding them not to allow all the noise to distract them. In my opinion, fear is a real hindrance in accomplishing any goal in life and especially financial goals.
As with most progress in life, there usually has to be some level of risk taken to succeed and accomplish something big. As a CFP®, I help people determine the goal and what level of risk would be required to meet that goal. Sure, anybody can go through life and not take any risk, but I believe true success personally and financially requires us to take some amount of risk.
Helping each person or family know what this is for them sometimes is challenging, but very rewarding. Age and time probably have the most effect on a financial plan. The younger someone is, the more time they have to meet their goals. This usually includes making mistakes and learning from them.
Financial plans also change over time, and as a person ages and nears retirement, their plan should adjust and reflect this.
What I am saying is this, there is no one size fits all. We were all created different, and no two people are alike. This is why financial planning is an art.