The 7 Most Important Financial Planning Issues To Consider

01 February, 2023

Financial planning is a crucial part of every person's life. But if that is so, why are millions of American employees still facing financial planning issues day-to-day, which in turn affect their financial stability. Where are they going wrong?

Well, in the world of financial planning, there are also seven deadly sins that people fall into. But instead of suffering in purgatory, they suffer with never-ending financial stress.

In this case, you can think of a financial advisor as a guardian angel, leading those in need down a righteous path to a successful financial future – and of course, making the journey a lot easier and smoother.

The 7 financial sins (challenges) you need to tackle to ensure financial success

Many people are not proactive about their finances, which may lead to serious financial issues in the future. Here are some of the most common financial planning issues to consider:

Not having a tax plan

Nearly half of Americans say they are paying too much in taxes. The general rule of thumb has always been: it’s better to overpay taxes rather than underpay them. Although this is true and the IRS is generally good at refunding the excess, changes in tax brackets, interest rates, and common oversights could see tax payers losing out.

Tax planning is about understanding your finances and how to take advantage of them. It's not about avoiding paying taxes or hiding money from the government—it's about taking advantage of all the financial benefits you have available to you so that you can save money on taxes in the long run. Having a financial advisor can help you navigate the process and prevent mistakes that could cost you money later on down the line.

Mismanaging cash flow and debt

Most people struggle with their finances because they don't know where their money goes. You also need to plan for things that are unexpected, like a car repair or an emergency fund. If you don't know how much money is coming into your account and going out each month, then it's nearly impossible to create a budget.

There are many different ways to manage your money, but most of them require planning ahead and creating goals for the future. This type of planning process takes discipline because it requires patience and dedication.

Not investing

It isn't easy for many to wrap their heads around the concept of investing. And while there are many ways to invest money, they don't work for everyone at all times. Some people need short-term solutions while others are looking for long-term ones; some want low-risk investments while others want high-risk ones, etc. If a person doesn't know what type of investor they are yet, how can they know which strategy will be most effective? This is where an investment advisor could become a valuable guide.

We can be that guide. For more information, check out our investment management services

Not having a retirement plan

Despite the fact that most people are aware of the importance of retirement planning, it still remains one of the most common financial planning issues. This is because many are still confused about some of the most basic aspects.:

  • How much needs to be saved?
  • What should be invested in?
  • How much money should be put away each month?
  • How should investments be managed?

These questions and others can cause a lot of stress, especially if you don't know where to turn for answers. That's why it's so important to find a financial planner who understands your needs and will tailor their advice accordingly.

Not managing family risk

Family Risk Management (FRM) helps you identify and manage risks to your family, so they can live the life they want to. It involves identifying the risks facing your family, then developing strategies to manage those risks.

FRM is important because families don't always think about what will happen if one of them becomes disabled or passes away. So, it's important to consider these possibilities and how they'll affect each member of your family. It's also important to plan for things like caregiving and eldercare needs as we age.

Failing to have an emergency plan

It's difficult to plan for the unexpected. We can't know what events will occur over the course of our lives. For example, if you had a major injury that prevented you from working, how would your financial plan adjust? A lot depends on the type of event (recovering from an illness is different than losing your job) as well as its impact on your life (being unable to work full-time could mean needing more savings).

Remaining financially uneducated

Financial education is a lifelong process and is what all these financial planning topics come down to. It’s not just about money – it’s about understanding how the world of finance works, making good decisions, and feeling confident enough to manage these financial planning issues to achieve long-term goals.

The problem is that the average person does not have access to a means of unbiased financial education. Of course, there is plenty of information out there, but it is a matter of finding the information and avoiding the scams in between – which is a whole other type of financial planning issue to consider.

Getting help to tackle these issues

The fact is that most people are not intentional “financial sinners.” They just don’t have a financial plan or even know how their money is being used on a monthly basis. They don’t know what their net worth is and whether they can afford to retire when they reach a certain age.

When it comes to managing finances and making sure you are where you want to be, it helps to have a team of expert financial planning guardian angels who can provide the guidance you need to tackle these financial planning issues.

We can be that expert guide that helps your employees reach personal financial success so you as an employer can achieve bottom line business success.

Get on the road to success

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. Any specific securities or investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own situation before making any investment decision including whether to retain an investment adviser.

All expressions of opinion are subject to change without notice in reaction to shifting market, economic or political conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. This content was created as of the specific date indicated and reflects the author’s views as of that date. Supporting documentation for any claims or statistical information is available upon request.

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