887: Financial Planning (Part 1): Time and Planning by Grumpus Maximus on Financial Independence Plans
This is optimal finance daily episode eighty-seven Financial Planning Part One time and planning by G- rumpus maximus of Grumpy Maximus Dot Com and I'm Dan. I'm your host here on optimal finance daily and I am here every single weekday bringing you some of the best personal finance blogs on the planet in audio form and today. I've got a brand new author and website for you. The site is G- RUMPUS MAXIMUS DOT COM. He uses a pen name to separate his personal and professional lives and he has a bunch of helpful articles on his sites. You can check it out at grumpy Maximus Dot Com and with that let's hear our first post from him. As we start optimizing your life financial planning part one time and planning by grumpiness maximus of grumpy maximus dot com quote in preparing for battle. I have always found that plans are useless but planning is indispensable cool Dwight D Eisenhower bottom line up front bluff. I received comments in response to my last post from people who were receptive to the idea of financial independence F I save but for one factor actor the amount of time it would take to figure out how to achieve that goal I get it life has a knack of interrupting attempts to plan long-term from babies to hobbies to the day to day grind of work. There's just not enough time in one day one week or. For one month to sit down study the problem and conduct the planning that F. I. requires no doubt F. I. Takes Time. I used a three month temporary duty T._D._y.. Assignment to develop my plan since I was separated from my family I decided to put my time to good use however you may not be so lucky as to get three months of T._D._y.. From life other responsibilities to conduct F. I. Planning if lack of time is your biggest obstacle to planning for F- I I'm including an outline to follow in an attempt to save gave you some time depending. On how well you track your finances using the outline. We'll probably cut your required planning time in half speaking of the need to track your finances. If you have not already done so. Please read my post on the need to track your finances before we're going any further with this one some questions you may have. What method do you use? I use the grow method G._R.. O. W. or as I like to call it the grow to w method grow to w stands for goal all reality obstacles options and way ahead. It's a method for goal setting and problem solving that life coaches used to help their clients. I found the grow to w model particularly well suited for F. I. Planning so will it be a one hundred percent fit for me. You know everyone has different financial circumstances that might dictate a need for either a simpler or more detailed planning method Herald pollock recently made the Washington Post with his four by six note card which is pictured in this post filled with what what he claimed was all the financial advice person might ever need he wrote nine pieces of advice or steps to take an all but one of them appears to be perfectly valid advice based on the most current research in the personal finance industry another website. I recently discovered E._S._i.. Zayn money dot com has boiled everything down to three steps. Earn Save and Invest Easy E._S._I.. Something that simple may be more suitable to the particularly money savvy or frugal the rest of US myself included are probably better off off with a few more steps and details are planning method. Is it guaranteed to work. nope I offer no guarantees when it comes to something as nebulous as planning for the future however I would refer you to the quote by Dwight Eisenhower at the start of this post referencing using the value of planning versus the plant itself even if this method does not produce a workable plan. I would argue that you would be in a much better place having conducted F. I. Planning Than had you not. Shouldn't I hire someone to do this for me. Maybe but only after do you consider the following points. There is an entire industry out there devoted to financial planning that would have you believe it requires special Voodoo magic skills to do this all while they tried to sell you their products and services in order to solve your financial issues for a slick like one to eight percent commission in fact beyond your time it does not require anything more than an ability to read comprehend and some basic math skills. Can you add and subtract good you qualify certainly not all financial planners are out there to fleece you especially the ones who operate by the fiduciary standard however all of them cost money and even those who operate by the fiduciary standard face conflicts of interest with the various compensation methods that serve as industry standards furthermore there is a large and growing body of. Evidence demonstrating the irrecoverable negative effect that active management fees 'cause a portfolio needs some more convincing than just the ramblings of some guy who decided to start a blog good it pays to be skeptical. When it comes to your money I could be wearing tinfoil hat for all you know I would suggest you find a copy of neat silvers book the signal and the noise? He has an entire chapter devoted to the issue written in much more elegant pros than yours truly can manage. That chapter was the straw that broke the proverbial camel's back for me. Don't trust some author. You've never you heard of Nice that was a test and passed again. How about the S._e._C. The Securities and Exchange Commission then they produced a short pamphlet with pictures and words demonstrating the effect of fees over time? Maybe I was wrong about the need for math skills putting my snarky nece aside. If you feel like this is something that you cannot do by yourself I would recommend a fee only advisor think of it as pay-as-you-go for their advice they tend to have the least conflict of interest but they could still prove expensive depending on the type of services you want and honestly I do not know how expensive since I never used a fee only advisor although I wished I had rather than paying a full fee adviser for several years check out the website Napa dot org that's N.. A. P. F. A. Dot Org for the details details of a fee only advisor in your area also go into the interview. Yes you should interview your adviser like you would Anani or employees armed with questions with all that said it remains my humble opinion that you can do this yourself. I did and I am a liberal arts major after all besides who do you think is going to look after your money better than you. You just listened to the post titled Financial Planning Part One time and planning by Rumpus maximus.