“There is nothing wrong with changing a plan when the situation has changed.” – Seneca the Younger
Financial planning is an essential aspect of living in our wealthspace, as it helps us achieve our financial goals and ensures our long-term financial stability.
However, no matter how well we plan, life is unpredictable, and situations can change quickly. Therefore, it’s important to remember that there is nothing wrong with changing a plan when the situation has changed. In fact, it is often essential to adjust your finances with them!
One of the primary reasons to change a financial plan is when a significant life event occurs. Whether it’s getting married, having children, or changing jobs, these events can majorly impact your financial situation. For instance, getting married can involve combining your finances with your spouse’s and adjusting your budget accordingly. Similarly, having children requires additional expenses such as child care, education, and medical expenses. It’s important to recognise the impact of these events and adjust your financial plan accordingly.
We’ve also found that alongside the changes to your plan we have to learn to communicate in different ways as we now have more than one person making all the financial decisions. It’s never just about the numbers, in fact, it’s mostly about the relationships!
Another reason to change a financial plan is when there is a change in the market conditions. Markets are inherently volatile and can change dramatically in a short period. For example, the COVID-19 pandemic and other global knock-on events had a significant impact on the financial markets. Investors who had planned their investments before the pandemic might need to adjust their investment strategy in response to the market conditions. Similarly, if interest rates change, it can impact your borrowing and investment decisions.
In addition, changing personal circumstances such as illness, disability, or job loss can have a significant impact on your financial plan. In these situations, it’s important to reassess your budget, expenses, and savings. You may need to adjust your financial goals, delay a major purchase, or find ways to supplement your income. It’s essential to take a proactive approach and make the necessary adjustments to your financial plan to ensure you can weather any financial storm.
At WellsFaber, we always remind our clients that financial planning is an ongoing process. Whether plans change due to significant life events, market conditions, or personal circumstances, adjusting your financial plan is essential. Being intentional about making adjustments can help you achieve your financial goals and ensure your long-term financial stability.