Thursday, May 28, 2020

Finding Your Personal Coordinates to Point “A”

It’s time to take a little journey through the world of finance. Before delving into stocks, bonds, savings, retirement, spending, trust and estates, tax planning and insurance, the key to success will be communication between you, yourself and I, and then communication between the immediate and broader world around you!

It takes a good look in the mirror to begin the proce ss of introspection. But most people will need to go through this process with a guide, coach or financial planner . The problem is that annual New Year’s resolutions, when it comes to finance, don’t last for the vast majority of individuals. Why? Because it can wait. So it does wait. And wait until it is no longer on the agenda. This is not uncommon. We all need a wakeup call now and again. For example, many people push off their yearly dental appointment until they have a problem and are in pain. Unfortunately, life allows you to continue riding a runaway train when it comes to finances until damage has been done. This can be as simple as a late fee or as dramatic as bankruptcy.

There are dozens of articles in the personal finance arena that discuss the importance of communicating and navigating through your finances with your partner. However, it may take a level of maturity, discipline or just the passage of years for an astute individual to indentify and articulate their personal finance habits in a constructive and effective manner to themselves, let alone to someone else!

When does one learn about their credit score and how important it is to accumulate good credit and protect it? Usually that learning happens when you need it for a loan of sorts. At this point it’s too late. The same goes for banking, bill paying, budgeting and meeting with a tax person. When is one supposed to figure all of these matters out?

Communication really works best with an understanding of self. We need to first figure out our general personality type and then how it reflects on one’s lifestyle/habits/philosophy when it comes to money. To do this I would recommend working with an objective counterparty, be it a social worker in college, financial advisor (especially in this case I would recommend this advisor be a fee only, independent advisor), mental health professional/therapist, member of clergy, relative or good friend. If meeting with someone is not on the agenda, then you can benefit from reading personality books and try to identify traits while those with even less time will benefit from even a simple online survey. Although some websites offering this may not be run by professionals, there are those that will offer professional assessments such as the Myers-Briggs personality test. Whether with a comprehensive and professional assessment or the simple survey, it helps to go through the results with someone else.

Once you’ve taken some steps in the personality realm, the second step is more technical: to set up a yearly, quarterly or monthly follow-up to help you review yourself vis-a-vis your most recent financial activities/life experience. The first is simply to help you hone in on your strengths and weaknesses as they may pertain to personal finance with the hope of setting some attainable goals. The second is the insurance program to determine if you are on track, and what should lie ahead.

Once you have a better footing as to where you stand in the personal finance terrain, you can take steps to make better decisions for yourself. Then, just like going from point “A” to point “B” on a map, when dealing with a roommate, friend, partner, family member or member of the community at large you’ll know where you stand and can have a more fruitful and productive relationship .

Please note: This article is my personal opinion and not intended as individual professional advice

Ronn Yaish is a finance journalist/columnist/author and financial advisor at Livian & Company, a NYC investment and wealth management firm, and holds positions at ORG. Financial, WhirlwindMoneyCoach, BE Financial and Gifting Advisory Group.

By Ronn Yaish