personal finance is personal

“Personal finance is more personal than finance.”

- Tim Maurer

This is my favorite quote about personal finance, and it embodies why it is so important to align your spirit, mind, and body to discover your authentic life. Because each of our authentic lives are different, the planning related to our finances will vary and should be aligned with the life we are trying to design.

There are foundational principles that all solid financial plans are built on, like understanding and managing cash flow, adequate insurance (life, disability, umbrella, etc.), building savings, having a long-term investment strategy, etc. Even within these foundational principles, the amounts and how they are implemented should be determined by the individual (or couple) whose plan it is, not necessarily by rules of thumb or textbook answers.

Beyond these principles, the design of a financial plan should first consider the life, goals, values, and desires of the individual and then look to find the best strategies that align with the individual's vision.

Instead, many financial plans begin with textbook planning techniques, like maxing out a 401(k)--which is not a bad thing, but it might not be the right thing for everyone, and then trying to squeeze in life; life becomes constrained by what software and spreadsheets have determined to be “right.”

Or, financial plans begin without the individual knowing what they want their life to be. The plan becomes a plan for the goals and aspirations we are told to pursue by others, which may be ok for some people, but I believe the majority of people, if given the opportunity or knew they could, would much rather design the life they truly want over following someone else’s prescribed path for them.

Don’t get me wrong, a plan is better than no plan at all. And, a plan that starts based on spreadsheets and software or influenced by others can always be amended and redirected in the future. But, if you are going to commit to the time, effort, and energy of creating a financial plan, why not make the plan your own personal financial plan, not just a financial plan?

If personal finance is more personal than finance, make sure you spend the time to make sure you know the person (YOU) that determines the “personal” in personal finance.

See you tomorrow and keep pursuing,

JC