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Michael Pope Blog post by Michael Pope

Why is Money Planning Important?

Imagine for a moment that you have decided that you want a new Home. However, to this point you haven’t thought about what you want the home to look like, how many bedrooms, living areas, or outdoor spaces it should have, how much it might cost, or how you are going to pay for it.

How likely do you think it is that you will get what you want when you want it, if you haven’t yet thought about or planned these vital decisions?

Your next logical step is to develop a plan which WILL require the assistance of qualified professionals such as:

  • A Mortgage Broker or lender to see if you qualify for the loan
  • A Money Planner
  • A Real Estate Agent or Buyers Agent
  • A Conveyancer or Legal Representative
  • And, if you are building something new, you’d require:

o Plans drawn up by a Draftsmen or Architect
o A qualified Builder
o An Engineer
o A Land Surveyor
o A Town Planner to review and approval plans

All these professionals are potentially going to be required to make it happen for you and they are the ones that assist with your plan to achieve your goal/objective.

This plan now also gives you the opportunity to check and monitor the progress, make sure things are on track and refine your vision as your plan progresses, as you discuss and receive feedback from those professionals. This will ensure you will get what you want as an end result.

Now, I’d like you to go back and read those paragraphs again, but this time replacing the “new home” with “retirement”, or, if you prefer, “financial independence”.

Empower Wealth believes that Money Planning is a critical factor in achieving (or failing to achieve) your desired lifestyle, now and for the rest of your life. In my experience of talking to and advising people, I find that many people can describe their “dream home” in great detail, but very few have taken the time to think about their “dream life”. (For an introduction of Money Planning, please refer to our December 2010 newsletter)

Money Planning is not just about making sure you can pay for things now; it’s about building a road map that incorporates detailed cash flow analysis and wealth projection outcomes.

The power of which when implemented into a written plan, is like seeing your wealth build, just the same way as achieved your ‘new home’ outcome.

Without a Plan to deliver an adequate source of funds for whatever lifestyle you choose, you may end up like the vast number of Australians reliant on the Government to fund their retirement, turning their dream life into a nightmare.

Money Planning is critical, but it is not something that comes naturally to most people. Getting started can be a challenge. At Empower Wealth, we have developed a range of tools to assist with this vital task. MOST IMPORTANTLY, we’ll be demonstrating some of these at our next Private Circle Wealth Forum on the 17th February 2011 from 6pm til 8.30pm.

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