A financial plan is a roadmap that helps guide you along the path to achieving your goals. But it’s not a once-and-done document. At least once a year — and any time you’re impacted by a material change, like a job loss, marriage or a death in the family — it’s a good idea to review your plan and revise it as needed. If you don’t have a financial plan, there’s no time like the present to create one!
A major benefit of a financial plan is that it can give you a long-term strategy to not only help reach your goals, but also to weather unexpected events. It can help you worry less about the short-term impact of things like a market correction or even the COVID-19 pandemic, and allow you to make timely changes that can help keep your financial dreams on track.
What a financial plan covers
Retirement is a common foundational goal for financial plans, which can define retirement goals and create a strategy designed to make the vision real. It’s also often prudent for a financial plan to address short- and mid-term objectives, whether that means starting a business, buying a second home, supporting a child’s or grandchild’s college costs or other wishes. A plan may also include strategies designed to create tax efficiencies in retirement and at death.
In short, financial plans can encompass needs, wants and wishes, and provide a path designed to reach them — from your investment portfolio allocations and retirement accounts to insurance and business valuations, and more.
The three steps of a financial plan review
At Hancock Whitney, we typically use the following steps to help our clients keep their financial plans on track as life changes.
1. Understand, re-evaluate and review. The process starts by reviewing what we currently know about you and taking stock of what has changed — on your balance sheet, income statement and in the overall landscape of the environment.
Then we can look at your overall budget — your income and expenses. Unfortunately, the COVID-19 pandemic has led to reduced incomes and increased expenses for many people. If that or other events have impacted you, we can work with you to consider how to revise your budget to accommodate these changes.
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At this point, we can re-evaluate your goals. What was once a necessary goal for you and your spouse may not be so anymore. Should we replace one goal or expense with a different one? We can also help gauge whether you’re still on schedule to meet your timelines. If you’ve experienced a reduced income, for instance, you may need to push out some goals — potentially even your retirement date — to regroup your finances.
As goals change and years go by, it’s also important to review your investment portfolio allocations and strategies. With the pandemic’s wholesale economic impact and ongoing inflation concerns, many people’s risk tolerance has changed. Other current events might also impact your plan and your strategies. For instance, pending legislation might alter your tax mitigation tactics or your decision about whether and when to complete a Roth IRA conversion.
2. Plan and educate. After understanding what’s changed, we can update your plan to illustrate where you are in your financial journey and where you would like to get. We can identify any gaps that might exist and provide several recommendations to help you achieve your financial goals and dreams. We can also address questions or concerns you may have regarding the proposed plan.
3. Guide. Once the proposed plan is agreed upon, the final step in the process is to develop a guide for executing the changes to keep making progress toward your financial goals.
Your Hancock Whitney financial advisor can help with every step of a financial plan review — or with creating your first plan. Our mission is to help you achieve your financial goals and dreams — and to ensure you feel confident about your financial future.
The information, views, opinions, and positions expressed by the author(s), presenter(s), and/or presented in the article are those of the author or individual who made the statement and do not necessarily reflect the policies, views, opinions, and positions of Hancock Whitney Bank. Hancock Whitney makes no representations as to the accuracy, completeness, timeliness, suitability, or validity of any information presented.
This information is general in nature and is provided for educational purposes only. Information provided and statements made should not be relied on or interpreted as accounting, financial planning, investment, legal, or tax advice. Hancock Whitney Bank encourages you to consult a professional for advice applicable to your specific situation.
Investment products and services, such as brokerage, advisory accounts, annuities, and insurance are offered through Hancock Whitney Investment Services, Inc., a registered broker/dealer, member FINRA/SIPC and an SEC-Registered Investment Advisor.
Hancock Whitney Bank offers other investment products, which may include asset management accounts, as part of its Wealth Management Services. Hancock Whitney Bank and Hancock Whitney Investment Services Inc. are both wholly owned subsidiaries of Hancock Whitney Corporation.
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