Why You Need a Holistic Financial Plan

Why You Need a Holistic Financial Plan

Thinking about money can be a daunting task – and often, we lose sight of WHY we work and save as hard as we do. It’s only human to focus first on the HERE and NOW…What about the big picture?


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A holistic, goals-based financial plan, with the help of a financial professional, can provide just that. Below are nine reasons why you need a holistic financial plan. 


1. Spend Your Time and Effort Wisely

The tasks around money – navigating a phone tree, filling out paperwork, or facilitating transfers – are draining. At the end of the day, you may question, what was all this effort for? As CEO of your household, it’s not the best way to spend your time. 

You don’t want to lose sight of the most important part of a financial plan – creating and sticking with your goals! If you don’t clearly know what you value and behave accordingly, your plan will fall off the rails. A holistic financial advisor can also help you delegate your limited time and energy to what actually matters.


2. Emotional and behavioral coach

We all know that life is full of twists and turns. But what if there’s a deviation in your plan, such as a job loss or market downturn? You might make emotional, rather than rational, decisions. As an example, if the stock market falls dramatically, fear may cause you to consider selling to “preserve what’s left.” Or, if times are good, you might consider making a “stretch” purchase that’s not necessarily in line with your big picture.

 A holistic financial planner can help guide you through these decisions, regardless of what’s going on at the macro level.  As well, he or she can serve as a sounding board for your money choices.  Focus on staying on the straight-and-narrow with your plan, and let a professional help guide you through the rest. 


3. A Personalized  Second Opinion

Sometimes, things happen in life that are too niche for even the most detailed internet search. This is where a holistic planner shines. He or she gathers detailed information about your financial life and evaluates what you’ve done yourself. 

Then, with a 360-degree view, your planner can objectively evaluate your entire financial picture, suggesting appropriate solutions for your unique situation. Unfortunately, the internet can’t have a total view of what’s going on in your life, and may only provide generalized guidance.  


4. Keeping the Peace with your Spouse

Even experts need help with talking about finances with a significant other. Why? Personal values, emotion, and often, self-identity, are tied up with money. We don’t always act on what makes “textbook” financial sense because, well, we’re human! But as we all know, conflict can ensue when both spouses are not on the same page – and sometimes it takes an outside party to serve as a mediator.  

A holistic financial planner makes sure that both spouses, regardless of their level of financial literacy, are involved in the conversation. Even if you’re “not a financial person”, you have opinions about where you want to live, what school your children should attend, and what your ideal retirement looks like – all LIFE decisions with a financial tether. It’s important to express yourself! 


5. Organization 

As we move through life, we accumulate more “stuff”- and that includes “financial clutter” and paperwork! A holistic financial plan can help bring everything together and deeply analyzes your entire financial world. You may even find out something you didn’t realize you had, such as additional ways to optimize your money. Finally, some professional advisory firms offer organizational tools to clients, like a virtual document vault or account aggregation, to help keep you on top of your financial world daily. 


6. Retirement Planning

You’ve saved diligently during your working years, and now it’s time to draw on your lifetime earnings. Making the switch from “saver” to “spender” is a daunting mind-shift! You could be afraid that you might run out of money, or, conversely, that you’re too frugal and possibly missing out on a life dream. 

Even if you have sufficient resources, how do you manage them tax-effectively? What is the best way to keep your household protected? How do you give to children, charity, or accomplish other wishes both during life and after? 

A holistic financial plan considers all these aspects and more to help you figure out the best way to use your savings intelligently during retirement. 


7. Tax management

It’s important to know the role taxes will play in your financial future, especially when making investment decisions. Accountants tend to look backward and help file tax returns and suggest tax-saving ideas for the next year.  They don’t always know everything about your financial situation, and as such, may not be able to help with tax planning for years down the road.

Moreover, certain tax strategies entail paying more taxes today but less in the future (like a Roth IRA conversion). A strategy like this may not positively impact your finances for years down the road. Without the help of a financial plan, it can be difficult to conceptualize this type of concept. 

Finally, if you make a costly tax mistake, such as not taking enough for a required minimum distribution, an accountant cannot always fix your error. A plan helps you avoid this kind of blunder. It’s important to have multiple sets of eyes considering the tax impacts of your financial decisions.


8. Estate planning

It’s not fun to think about incapacity or death.  But it’s even less fun if the funds you’ve worked so hard to earn are not utilized and/or distributed according to your wishes. This is where estate planning becomes so important.

If something happens to you while you’re still alive, an estate plan maps out a care plan for you if you become incapacitated and unable to make decisions for yourself – a critical “what if” that many people neglect.

 A comprehensive estate plan can help you consider how to best distribute funds after you’ve passed away, or how to take steps to more fully enjoy your resources during your lifetime. A holistic financial planner will likely mandate that you have these critical documents in place so they can coordinate your wishes with your resources.


9. Planning for Life’s “What Ifs”

A holistic financial plan gives you permission to dream. What if you retired early? What if you bought the beach house you’d always wanted? What if you used your resources to help your children and grandchildren with their ambitions? When you have a plan that considers your situation first, you can layer these other goals on top. You then work with your spouse to prioritize, possibly compromise, and act on this mutual vision for your future.  

At Prism Planning Partners, we are CERTIFIED FINANCIAL PLANNER™ Professionals committed to facilitating important questions so that we can help you explore all of your opportunities. We offer a broad array of financial planning and consulting services for our clients-including estate planning.

Contact us today and let us illuminate your possibilities!

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Prism Planning Partners, LLC dba Prism Planning Partners is a Registered Investment Adviser. This article was produced by Paladin Digital Marketing, an entity unrelated to Prism Planning Partners and may not necessarily reflect the expertise of this financial advisor. This publication is not intended to provide investment advice and is intended for your information only. Opinions and forward-looking statements expressed are subject to change without notice. Information based upon third-party sources and data are believed to be accurate and reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. All domestic and international rights are reserved. No part of this publication including text, graphics, et al, may be reproduced or copied in any format, electronic, print, et al, without written consent from Prism Planning Partners. Neither Prism Planning Partners, nor its investment advisor representatives provide legal or tax advice. Please be advised to consult your investment advisor, attorney or tax professional before making any investment decisions. 
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