There are many factors that influence financial plans and goals, which can be characterised by “The Known-Unknown Classification of Risk” framework made famous by former US Secretary of Defence, Donald Rumsfeld.
One of the keys to effectively managing change, both practically and psychologically, is having control over outcomes. This requires planning for each of the boxes in the matrix.
The emotional consequence should be feelings of comfort and confidence, which are typical when we feel in control.
But for those who lack the time to plan and manage their financial lives, fear and anxiety inevitably take hold. Their strategy becomes defined by the actions they don’t take, as much as those that they do.
If we view the known-unknown framework in this context, it’s clear that there are many circumstances and events that can be controlled or influenced. But substantial time and expertise is required to ensure that a plan is holistic and exhaustive.
For most people, the demands of life – such as the competing commitments of finances, career, family, health and recreation – are enough to make maintaining a comprehensive financial plan challenging enough.
Couple this with the depth and breadth of the subject matter with all of the factors in life that may occur (known or unknown) and the challenge is near impossible.
One option is to delegate development and proactive management of a plan to a professional who has the time and the expertise to help you achieve your goals.
At Advise Wise, a pro-active approach to client’s plans forms a key part of that development, adaptation and management that is required for success.
If you’d like to understand more about how a financial adviser can help you, visit us at www.advisewise.com.au to learn more and to schedule a time to speak to our team.
