64% of Americans have no financial strategy at all. That’s right – no plan whatsoever to build wealth or keep it. That finding comes from the 2009 National Consumer Survey on Personal Finance conducted by the Certified Financial Planner Board of Standards, Inc. (The survey collected data from 1,700+ U.S. residents.)
Only 17% of us have a written financial plan that is updated regularly. So congratulate yourself if you are in that group. The CFP Board found that just 17% of the 36% polled who did have a written financial plan had reviewed it in light of changing times. Notably, 48% said they had benefited from having a written plan.
Just 38% of the 36% having written financial plans retain a financial advisor. The really troubling part: 37% of those with written plans are doing their financial planning on their own. Another 12% of respondents with written plans have consulted a friend or family member who isn’t a financial services professional for advice.
Why don’t more people have a financial plan? After all, Americans of all incomes and savings levels certainly are free to set financial goals. In the survey, the reasons varied. Some cited the expense of engaging a financial advisor; some said they get along just fine without a financial plan, and others felt their finances weren’t complicated enough to warrant one. Others were hazy about financial services industry qualifications – 40% of respondents had no idea that there were professional credentials or designations for financial advisors.
Syndicated financial columnist Humberto Cruz recently noted that when he told some fellow vacationers in Orlando that he wrote about financial planning, they all asked him if he gave stock tips. He had to explain that he was simply a journalist, not a financial planner.3,4
Defined goals lead to definite plans. If you set financial objectives and plan for them, you vault ahead of most Americans – at least according to the CFP Board’s findings. A written financial plan does not imply or guarantee wealth, of course; nor does it ensure that you will reach your goals. Yet that financial plan does give you an understanding of the distance between your current financial situation (where you are) and where you want to be. Too many Americans, it seems, have little comprehension of their financial situation or their financial potential.
How much planning have you done? Retiring without a financial plan is an enormous risk; retiring with a financial plan that hasn’t been reviewed in several years is also chancy. A relationship with a financial advisor can help to bring you up to date about what you need to do, and provide you with more clarity and confidence when it comes to the financial future.
For more information, please contact Wealth Management Associates at 925.462.6007 or online at wealth-mgt.net.
About Wealth Management Associates
Wealth Management Associates is a leading independent financial planning and wealth services company which operates three offices in Northern California. The company’s headquarters is located in the heart of Pleasanton, in the town’s quaint downtown located at 400 Main Street, Suite 200. The company is owned and operated by Certified Financial Planner® Brian Damiani. Over the years the business has been transformed into an organization focused on helping families and individuals to meet their financial goals by providing comprehensive financial planning. Now servicing more than 200 families and individuals, Wealth Management Associates offers the following services: accelerating personal wealth, designing financial portfolios, 401K and IRA management, estate preservation, retirement planning, asset allocation, risk management and life and medical insurance for small businesses and individuals. For more information, please visit www.wealth-mgt.net or call 925.462.6007.
Investment Advisor Representative with and Securities and Investment Advisory Services offered through Transamerica Financial Advisors, Inc. (TFA) member FINRA, SIPC and a Registered Investment Advisor. Non-Securities products and services are not offered through TFA.