What is vs What if: How Do You Plan for Financial Uncertainty?

What is vs What if: How Do You Plan for Financial Uncertainty?

As we begin another year, I think it is only befitting to talk about the “What Ifs” in life. I strongly believe financial planning is the cure for financial uncertainty. You may ask, how do you advise a client when life is so uncertain? It is the largest challenge we face as financial planners. Especially when you think of the old Yiddish proverb, “We plan, God laughs.” What I’ve found is life’s uncertainties forces all of us to expand our thinking around “What is” vs “What if” scenarios. Our company’s expertise helps us develop strategies designed to assist you with reaching your goals and protect and manage your wealth.

Just like the economic effect of the current pandemic, the on-going restrictions on individuals and businesses will have a lasting impact. How does one plan for life-altering situations, not to mention more personal events: such as a death in the family, job changes, divorce, a major illness, and more? These are all ways that life itself can surprise you and alter your financial plans.

What If Your World Changes?

In the world of financial planning, we develop strategies for coping with the ambiguity of our clients’ futures. There is no crystal ball providing insights. That’s why our approach, after working with you, is to create “What if” scenarios to plan for and address uncertainty.

For a financial planner like me, the idea is to look at your life as a whole and help you make the best decisions. This requires factoring in your current situation, goals, income, savings, and lifestyle. Then, we use all this information to present possible outcomes for us to review and discuss. The goal is to provide you with as much pertinent information so that you feel confident about your final decisions.

What Events Can Affect Your Financial Plan?

Becoming a widow or going through a divorce can be just as dramatic as recovering from a loss due to a hurricane, all of these incidents create major storms in your life; emotionally and financially. From deciding how to balance taking the kids to school and after-school events to ensuring their college accounts are funded. There are so many practical and financial decisions to be made. If you sell your house, an important decision arises, what’s the best approach with managing the equity?

As the woman, now dealing with life without your partner, a major concern arises. How do you ensure the funds received from life insurance, alimony, and retirement accounts help you continue to build your future? Not only must the joint property be dealt with, but the remaining joint assets and how they’ll be managed.

Whatever change you’re experiencing in your life, the emotional and practical impacts will affect your financial decisions – not just in your immediate future but likely for years to come. That’s why it’s important to review your financial plan. The plan can be adjusted to address the multifaceted changes occurring in your life.

Why You Should Start Planning Now?

Smart women make plans factoring in the uncertainty of life. Smart women understand that it’s not just about the amount of money you earn, are awarded, or inherit, it’s about developing a plan around that money. The “What Ifs” in life will happen. Knowing you have a plan in place provides you with the financial confidence to live your life on your terms.

As a financial planner, I place great value on understanding my clients, learning about their life goals, and helping them navigate the “What Ifs.” Listening to what’s important to you now and as life changes allows me to factor them into guiding you with mapping out the plans around your money.

If you see yourself in this article and need to add another smart woman to your team, don’t hesitate to reach out to schedule your 20-minute exploratory meeting.

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Zaneilia Harris, CFP®, is the President of Harris & Harris Wealth Management Group in Washington, DC. Follow her on Twitter at @hhwealth.