Plan for the Best; Adjust for Reality
Years ago, I toured with a Dutch audio engineer and we became fast friends. He has a great sense of humor, enjoys nice food and wine, and – being a little older than me – I benefitted from his perspective & insight. We worked together on what was for me a pretty big gig (venues were typically nice theaters, some iconic venues like the Hollywood Bowl & Radio City Music Hall, and the occasional arena), but his main gig was with a much larger band. That band had intricate lighting, multiple video walls, lots of backdrop changes, toured with a string section and a horn section, and had something like 90 different audio inputs at any time.
Concert productions that complex require artists to travel with nearly all of the related equipment (instruments & amplifiers, audio & lighting consoles, a full lighting & video package, backdrops, and often the entire PA) and a lot of people to set up and operate the technical side of the show. It's not the type of thing that you can just figure out on the fly with local venue personnel.
So you can imagine my amusement when I saw my friend's post on social media a few years ago: "Entire crew misses flight; show happens anyway". All of the advance work, flights & itineraries, rental equipment (and trucks to haul it), and technical know-how of the seasoned crew went straight out the window when the crew's flight (but not the band's) was canceled. And yet: the show must go on.
Author Morgan Housel has a great phrase: "the most important part of a plan is planning on your plan not going according to plan." Well said.
Financial planning is all about turning your hopes and dreams for the future into a plan of action to help you build the life you want. But that doesn't mean that there won't be bumps and course corrections – sometimes major ones – along the way. Far from a statement of certainty about the future, financial planning is a process of identifying best next steps, taking action, and adjusting as reality changes. And reality always changes.
Imagine that I gave you a perfect – absolutely perfect – financial plan in January 2020 for how you could retire in ten years. Aaaaand then a pandemic shut down the entire world. It doesn't matter how great that plan was or how cool the logo on the hard plastic binder looked: all of the assumptions about stock market returns, interest rates, and inflation went out the window.
Does that mean that the plan was bad or that we shouldn't make plans? Absolutely not – plans are important! But there is a difference between a financial planning document that you hold in your hands (or read on your computer) and the process of financial planning. One is fixed in time, the other works with you as circumstances change.
And the need to adapt & evolve your financial plan isn't just limited to changes in the economy, stock market, or your paycheck. Your hopes and dreams will also change as you move through life. Think back on yourself 20 years ago. Did that person have the same goals that you do today? What are the odds that you'll have the same goals 20 or 30 years from now?
No one can know what the future brings, but that doesn't mean we can't plan for a better & brighter tomorrow. Working with a financial planner should be like traveling with a guide who not only helps you identify where you are on the map and in which direction to head, but also helps you make smart decisions as circumstances change. So let's take your best vision for your future as a starting point, make the best decisions we can now, and allow room for your plan to bend, change, adapt, and adjust.
The most important part of a plan is planning on your plan not going according to plan – and that's ok. That's what financial planning is for.
Timothy Iseler, CFP®
Founder & Lead Advisor
Iseler Financial, LLC | Durham NC | (919) 666-7604
Iseler Financial helps creative professionals remove stress while taking control of their financial futures. As both advisor and accountability partner, we help identify current strengths and weaknesses, clarify and refine your long-term goals, and prioritize understandable, manageable, and repeatable actions to bring long-term financial well-being. Reach out today to take the first step.