Seven Steps to Financial Wellness

Wellness is an ongoing process, not just a destination, and people both want and need help staying the course. A narrower perspective, “financial wellness” requires the same discipline. So, let’s break down “financial wellness” into constituent parts.

The global pandemic burst the bull market bubble and forced us all to reconsider our lives and priorities. Crises accelerate trends already underway. Before the Covid-19 pandemic, people were already concerned about being overscheduled and too busy and losing family time. Families are juggling jobs, kids, schools, and sports. They are stressed out. So, there was already a trend toward virtual meetings and working from home on Fridays if your job allowed.

We’ve seen the terrible suffering and heroic efforts of our health-care front line. Financial advisors make up a different kind of front line. Our clients are shaking off the initial hit to their account values and beginning to assess the fallout. They have concerns. They have fears about more than just the invisible and fatal health danger. They may face further pressure from job loss or the need to support other family members in trouble. All these real-life issues can change priorities. And new priorities call for new strategies.

I offer these eight areas of focus for financial wellness for you to consider and discuss with a trusted advisor:

  1. Financial decision-making. If something happened to you, who would you trust to make sound financial decisions for your family? A surprising number of people have no instructions on file with their advisor when asked this question. Is that safe?
  2. Financial management. Who’s making the decisions about investing? Before you dismiss this as obvious, the point is twofold. First, bear markets release nagging fears that someone may not be the best investor or advisor. Second, bull markets tend to encourage people to spread their assets around. The typical high-net-worth household has five to six “relationships” that will likely consolidate as they age. Making the case for who should be managing is a step towards better planning, and the consolidation of responsibilities with fewer advisors will follow.
  3. Estate planning. Not everyone needs a complex array of trusts, but everyone should have a plan that addresses all the details of death—if only to reduce the burden on the survivors. Covid-19 has blown up too many life endings and doubled the tragedy for families distanced by protective protocols in nursing homes and hospitals. Estate planning is not all about money; it’s about preferences. What are yours?
  4. Financial literacy. The traditional head-of-household single point of contact approach is dying out. Spouses, partners, and adult children are part of the family and need education to help them make good decisions. Financial advisors can help with this crucial communication process.
  5. Health-care decisions and costs. Nothing is more personal and more difficult to manage than health care—and nothing is more important. Peoples’ preferences must be reconciled with the local availability of services and potential coverage. As we age, the services we need are more varied. Too often, planners spitball health-care costs from national surveys that may not relate at all to their clients’ conditions. Financial planners need more precision, and that starts with a better assessment of your health, history, and desired level of care.
  6. Living transitions. Polls indicate most Americans would like to age in place. That objective may not be realistic when they consider factors such as cost, relative safety, and their need for proximity to family and services. Have you thought about where you will live? What about the phases of retirement? The first might put you with an active spouse or partner. The second phase might find your spouse in poor health. The third phase finds the you living alone. What if you can’t take care of yourself? These are emotional and important topics worth planning in advance so there isn’t a scramble—or a family battle.
  7. Diminished capacity. Cognition declines along with the rest of the body. We reach our peak ability to work with numbers at age 53 on average, and after that we begin to lose ground. At a certain point we put ourselves at risk for making mistakes, falling victim to fraud or identity theft, and using bad judgment or poor impulse control. Keeping track of your ability is critical to your health and safety. A good assessment considers your behavior, cognitive ability, and financial literacy with objective scoring.

Health and wellness are highly personal and increasingly complex emotional topics that can devolve into family battles as we age. What’s best for Mom shouldn’t be a war—especially when a little discussion and planning can start a better process.

Taking these points into account now will help prevent an imbroglio in the future. You and a devoted financial advisor can work together to ensure smoother sailing for the time to come. Voyager Capital Management is here to help you chart the course to a better future. Call or email us today and let the journey begin!

 

Voyager Capital Management, LLC -
Charting a course for the lifestyle you deserve.