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Establishing a Foundation for Financial Success in 2017 and Beyond
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Establishing a Foundation for Financial Success in 2017 and Beyond

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With the start of the new year, many have already begun working toward accomplishing their new year’s resolutions – whether it’s to go to the gym more often or to be more financially savvy. When it comes to developing a financial plan, in my experience, many fail to determine their values and goals as a vital first step, and instead focus on an immediate plan of action. While this is important, establishing justification for your plan of action is just as critical.

Here are five questions to help you define what you value most and how those values can relate to your broader financial plan.

What are your core values and what goals stem from them? I challenge you to quickly write down the first five things that come to mind, then put the list away and review it in a week. You may discover it accurately reflects your core values or you’ll realize it needs a bit of editing to get to your authentic list. After you finalize your list, explore what specific financial goals can align with your values. For example, if a core value is to ensure your family is provided for after your passing, then a potential goal may be to update or establish a life insurance policy.

What do you enjoy doing now and would like to continue to do in retirement? Get specific about what gives you joy. Perhaps it’s an annual family trip or monthly outings to the ballgame or theatre. If this is something you plan on continuing in retirement, it’s important to take this into account as you begin to save. It may also be helpful to envision what your lifestyle will be like when you retire – is it more lavish or similar to how you’re living now?

Where will you be in five or so years? This is a good question for any age. For those who are single, five years may mean getting married and/or buying a home. For young parents, it may be a job change or growing your family. For empty-nesters, a whole other set of goals may evolve. While five years may seem a while away, it can spring up on you fast. That’s why it’s important to begin preparing now so that you’ll be ready for any major life events.

What is your definition of being wealthy and how do you see building your wealth? Carefully consider your definition of wealth. Is it simply a matter of having enough? By recognizing what wealth means to you, you’ll have a better vision of how you can begin attaining it. Perhaps it’s by investing and saving, or the eventual sale of your business.

What would you like your legacy to be and what assets would you will to others? Pondering about your legacy is an exercise that will get you excited about achieving your goals. Having more than enough for yourself and leaving excess wealth to others is a noble goal. Consider what assets you would like to leave your heirs, a specific charity or even both.

If you take the time now to understand what you are working toward in life, it will greatly help you maintain your goals. There’s no better time than a new year to focus on your path to future financial success.

kristen-fricks-romanKristen Fricks-Roman CFP®, CRPS®, is a financial advisor and senior vice president at Morgan Stanley Wealth Management, Atlanta. She can be reached at kristen.fricks-roman@morganstanley.com.

The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. The strategies and/or investments referenced may not be suitable for all investors as the appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Wealth Management, or its affiliates. Morgan Stanley Smith Barney, LLC, member SIPC.

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