You Need a Statement of Financial Purpose

Let's talk about something important, financial planning. But hold up, don't hit the delete button yet! We're not just going to dive into numbers and spreadsheets. Instead, we're going to kick things off with a little bit of soul-searching. Yep, that's right! The first step in financial planning should be to start with what you want your life to look like.  We need to start with our WHY.

Ever wondered why you are working so much, or why you're stashing away so much of your hard-earned cash? Now, I am not judging! It's just worth remembering that all those hours at work probably mean you're swapping out some precious moments elsewhere, like missing your kid’s soccer game, the chance to exercise, or maybe even just taking an afternoon nap!  Tough, right? Makes you think about what matters in life.

That's why, you should kick off your financial planning with a clear “Statement of Financial Purpose”. Think about it - What does money mean to YOU?

Getting through the daily grind of life can sometimes feel like you're on autopilot. Wake up, get ready, go to work, come home, sleep, and then repeat. For most of us, this pattern started when we were just fresh-faced youngsters in college. Remember those days? Trying to cram before a test or stressing over a paper due on Friday. Then we hit the job market running and started climbing that corporate ladder. And why not? It's what we were told we were supposed to do.

We put in our hours, work hard, and save every penny for retirement, hoping to kick back by the tender age of 65. It's a well-trodden path and, quite frankly, it's what most people expect. But let’s be real - is this roadmap the one we want? It’s a big question, isn't it?

Ask yourself, "Is this the life I want to live?" If we don't at least ponder this question, we risk waking up one day feeling like life just happened to us. It's like we were sitting in the passenger seat instead of driving down our own journeys.

So, toss out the generic GPS, and let’s start mapping out a route that’s uniquely yours. One that isn’t just about “getting on the clock” and waiting for retirement but about living a life of choice. After all, we don't want to become victims of our lives, we want to happen to our lives! With a smile, a sparkle in our eyes, and a bounce in our step.

So, why not consider where we want to end up and work back from there? Let’s ride life’s roller-coaster with joy, determination, and a tangible plan in our hands. Let’s happen to life - and thoroughly enjoy the road trip on the way! Remember, it’s your life, your route, your rules! Let's make it all count.

Where do we start when trying to build a Statement of Financial Purpose? George Kinder is a leading financial planner in this area. He suggests three thought-provoking questions that can help lead to building your Statement of Financial Purpose. Questions to ponder, that may help lead you to mapping your best life.

First up, imagine, just for a minute, you're financially secure - you've got all the money you need, now and later. How would you live your life? Would you change anything? Take a deep breath, dream big, and paint a picture of a life that's uniquely yours.

Next, picture this - your doctor tells you (hypothetically, of course), you've got only 5-10 years to live. No feeling sick, but you will have no notice of the moment of your death. How would you spend the rest of your days? Would you live differently? Remember, in this scenario, you've got the same funds as you do now.

Lastly, envision your doctor dropping the bombshell - you've got just 24 hours to live. Right at this moment, reflect on what feelings surface, and what regrets you might have. What did you miss out on? Who did you not get to be? What did you not get to do?

Keep your Statement of Financial Purpose simple and to a few sentences. An example of this is what we have established as our personal Statement of Financial Purpose. “We want to build a strong, educated, and giving family. One that builds on the sacrifices of family that came before us and continues to improve the overall well-being of our family tree.”

Once you establish your Statement of Financial Purpose it becomes the beacon that guides your financial plan. Do not stress in getting it perfect right off the bat, and know that it will shift as you travel through life. Experiences and circumstances will mold it, and that's fine. However, without spending time creating one, you run the risk of letting life happen to you. Establish your Statement of Financial Purpose, keep your "why" at the heart of your financial plan, and make sure you happen to life.