What is Values-based planning?
Values based planning includes all the traditional financial planning topics you need to address for a thorough financial plan such as cash management, investments, savings, and other complex planning areas. But, in a values-based plan, your values serve as a guide to help you make thoughtful decisions and financial goals that align with your values. Aligning values with goals helps you understand the importance of your own saving and investing behavior when it comes to reaching your financial goals.
Clarifying my own values has helped me align my life in so many ways, not just financially. Because of its importance to me, I have made value clarity one of the tenants of Flourish Financial Life Planning. Early in the planning process, I use a series of exercises and conversations to help clients address value clarity. Through a collaborative process, we narrow down your values from 50 to 15, 15 to 10, and continue until we have your top 5 values.
Why is important?
Women who consider their values before making almost any decision, including financial decisions, make better decisions. Studies have shown that client behavior is the #1 factor impacting portfolio growth within a financial plan. We know there will be surprises throughout your life, and a values-based plan will help you to address an unexpected event with decisions that are based on your values instead of your current emotions.
It is hard to make financial decisions that reflect your values if you have never been asked about what matters most to you. The values you hold not only influence your decisions but also your interests and passions. Whatever you are passionate about, be it travel, adventure, grandchildren, etc. it needs to be considered in your financial plan. It is human nature to pursue our passions, and we will do so regardless of whether we have planned for them. But if we create a plan that can not only support your passions but encourages you to pursue them, your life will be as fulfilling in reality as it looks in your financial plan.
In my opinion, value clarity is the most fun and exciting part of the financial planning process. If you would like to get started clarifying your own values, contact me to learn more and get started.
