• Retirement and Annuity Advisor Jennifer Lang

Want a Comfortable Future Retirement? Start Planning Now

When venturing into the great unknown, you wouldn’t travel without a GPS or a map.

They are a “must-have” for reaching your destination. And for arriving on time, for that matter! How otherwise could you tell if you were going the right direction or if you were lost?


The same principle applies to our retirement. Whether you retire 10 years or 10 months from now, you need a financial plan.


In many ways, a plan is like a financial roadmap. It lays out clear directions for you to take and helps you keep on track.


Yet most people don’t have a roadmap for their future retirement. Just three percent of Americans have a written financial plan, according to Jim Chilton, founder and CEO of the Society for Financial Awareness.


Overcoming the “Ready-Fire-Aim” Mentality

And what explains the planning gap?

The fact that, all too often, we take a “spend-first, plan-later” approach to our finances, Chilton explains.


“Most Americans, sadly, are spenders first, then planners second – if at all. The basic common sense of plotting, planning, and participating in managing our cash hasn’t been wired into us,” he says.


“And why? I believe spending quenches our thirst. It’s more fun to burn through our money than it is to account for it.”


Just as with planned travel, retirement success has only two outcomes: you either get there or you don’t. There are no in-betweens.


Either we will have the money for a comfortable retirement, or the reasons why we don’t.


Why Do You Need a Financial Plan for Retirement?

So, why all this fuss about having a financial plan? Why is it so important for everyone to create and maintain one?


Because a plan brings vision, clarity, and accountability to how people handle their money. It’s a North Star that helps guide financial behaviors and choices – and that helps us accept responsibility for whatever we do.

Far too often, with no financial plan in place, people behave in ways that ultimately lead to financial setbacks or, worse, financial catastrophe.


Spending like there is no tomorrow. Racking up massive debts that suck away your income and your happiness. Failing to protect your money. Not being diligent about saving money and investing for your future…


A Plan Helps Drive Progress to Retirement Security

For Jim Chilton of SOFA, planning for your financial future is akin to traveling by car. Navigation of the roadblocks, unknowns, and wrong directions along the way comes with the territory.


“Most all of us drive a car. Logically, how would you expect to drive to a destination you’ve never been to, on roads you’re unfamiliar with, and expect to arrive on time without a map, GPS, or written instructions?” Chilton explains. “Our lives, going into the future, are calling for us to go to those unknown places.”


“Retirement, kids’ college, a huge emergency, terrific opportunity, a health scare. The future demands we follow a well-thought-out plan,” he continues. “Would you loan me your car knowing I was going to drive it and I was blind?”


With no financial plan, it’s hard to plot a clear direction for whatever steps you need to take financially. And not just that.


It also means people have no finish line to work toward, no benchmark to evaluate their current progress, and no metric to set future goals.


The Essentials of a Good Financial Plan

Your financial plan doesn’t have to be complicated. Most people can create a good foundation by following the “PRITE” procedure, Chilton advocates. Here is what that means.


Think of your plan as a 5-story building, or with five core elements:

  • Protection

  • Retirement