To set retirement goals, take the postcard test


It all starts with a pack of postcards that I bought from Amazon for five dollars. When I sit down with a new client, usually a married couple, I take out my postcards and put them on the table. Exercise: Pick five of them that represent the life you want.

Beach, hammock, grandchildren, cruise ship – these images are pretty common choices, but each has its own flavor.

A client wants to pay for his grandchildren’s education; another wants to go through the cathedrals of Italy; another wants to leave a dynamic company with little debt to its long-time employees. Different stories for different customers.

These stories are driven by values, which also influence our daily behavior. Our values ​​make us who we are.

If your parents hammered home the idea of ​​getting out of debt, you may have learned similar traits. Grow up in a traveling family and you will likely invest in showing the world to your own children. Watch your models take pride in charitable giving, and you will likely follow suit as an adult.

These values ​​are inherent in who we are, and knowing what you value – which postcard you choose – is vital to your financial strategy.

Your values ​​tell you why you act the way you do and how to optimize your plan for the future. Knowing your values ​​will make your plan more “conservable”.

Know who you are

Do you find yourself shopping for the most economical vehicle and leaving the next day on your second all-inclusive cruise this month? Do you catch yourself counting pennies at mealtimes and cutting out coupons for groceries, then the next day buying a vintage car (leather seat cover, of course) on a whim?

OK, these might be extreme examples, but where you save money and where you spend it depends on your values, which are unique to you and may not be meaningful to others.

Know who you want to be

“Lofty Values” tell you who you “aspires” to be. More than just wishful thinking, they also tell you about yourself.

If you feel drawn to donating to a wildlife conservation group, even if you have never done so, you are experiencing your values. Your aspirations, like giving to an ecological cause, always paint a picture of who you are and how you might want to invest.

By this same right, you will probably have not want to invest in a company with a lax environmental policy. In doing so, you would feel uneasy about your values, which could make this investment more difficult than it is worth in the long run.

Know what is possible

Knowing yourself can also help you plan for what’s possible. Some of us are natural savers, and some of us are natural spenders. As for me, I’m a natural spender, especially when it comes to relaxing with those I love or seeing a part of the world I’ve never explored. I know myself and I know I’m going to splurge on that expensive trip or meal, although it might not be strategic to do so.

Knowing this about myself, a practical step I take is to set up automatic savings. In a few clicks, I automatically take part of my income and put it into savings, investments and retirement. I don’t even see the money, and (after a while) I don’t even feel the loss anymore.

By understanding yourself, you have a grip on what is realistic in your financial life. You know your flaws and where to create an intentional outlet to express yourself financially.

If you know you’ll want a big celebration for your 20th birthday, plan for that! Make the cruise or lavish vacation part of your budget for the year rather than spending too much on D-Day.

If you know you tend to ignore distant future events like retirement, set some strict guidelines that will help you make it happen. Set up an automatic withdrawal from every check, put the money in a 401 (k) that will be hard to dip into, and budget from your take-home pay when all that’s done, not your job description salary .

Know which postcards you would choose

“Just making money” is a thoughtless and simplistic reason to work with your finances.

In the long run, your investments will reflect something deeper. Your values ​​will show up in how you spend and save, what makes you happy and what keeps you from sleeping at night. It is best that these financial stocks do not surprise you.

A values ​​inventory can help clarify your core values, which in turn can help you develop a plan with an advisor. Value assessment tests range from simple and free to complex and expensive.

You are going to be you for a long time! Your long-term investment strategy should be based on your strengths, weaknesses and driving values.

The postcards I give to my clients aren’t pictures of piles of money and rising trend lines, they show families making memories, places you’ve never been, people and causes in need. Your choice of postcard reflects a part of who you are, and the choices you make with your money should do the same.

Senior Vice-President, Financial Planning, Carson Group

Erin Wood is Vice President of Wealth Planning at Carson Group, where she develops strategies to help families achieve their financial goals. She holds the Chartered Financial Planner and Certified Retirement Planning Advisor designations.

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