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Financial Life Planning - Why It's a Good Fit for Solo Business Owners and Their Families

Behavioral Finance Personal Finances

As a solo business owner, taking the first steps in financial planning can be a big leap. However, you should know that financial planning is not just about having the right amount of money in savings, insurance coverage, retirement savings, etc. While the components are important, financial planning should emphasize you and your family living a full, fun and abundant life. Your money should not just act as a buffer but also as a means to mindfully enjoy life the best way you know how.

What Is Financial Life Planning?

Financial life planning can be described as a holistic financial planning process that puts the interests of a client first when drawing up a plan to help them manage their finances. Financial life planning focuses on increasing the client’s well-being and ability to reach their personal goals, instead of focusing solely on the numbers. From the beginning, this approach helps the client identify their current circumstances, priorities, aspirations and dreams; enabling you to mindfully create a holistic financial plan that allows you to live your definition of an abundant life.

How Is Financial Life Planning Different From Traditional Financial Planning?

Financial life planning focuses on bringing together both quantitative data and qualitative information during the financial planning process. The quantitative side is the numbers side, while the qualitative side is the side that seeks to have a deeper understanding of your unique values, fears, and aspirations among others. Financial life planning seeks to help you strike a balance between the two sides and enable you to live life to your full potential.

Traditional financial planning tends to focus solely on the quantitative side - that is budgeting, estate planning, insurance coverage, retirement savings, taxes, and so on. While this is better than no planning at all, focusing on this alone and ignoring the qualitative aspects of your life can reduce you to numbers on a page - and I'm not sure anyone really wants to live life that way.

Why Work With a Financial Life Planner?

Life is highly unpredictable as are financial markets and investments. If you want a solid financial plan that helps you achieve your financial and life goals simultaneously, you might want to consider a financial life planner. It's important you hire a planner who will take their time to learn about you and understand your concerns and desires fully.

The number of financial life planners is on the rise as more and more financial professionals grasp the importance of integrating life planning into financial planning. 

However, one great misconception about financial life planning is that it involves therapy. Part of the process may center on finding out why you approach your money the way you do but that is not psychotherapy. It’s all about uncovering your money history in order to help your financial planner to understand you wholly. The effects of the process may however be therapeutic.

The process also entails some elements of life coaching as your advisor helps you examine your life and understand the most important goals to you. They will help you pinpoint challenges, life transitions, and other money-related aspects of your life that you probably never considered important. From there, you can engage in developing a financial plan that best aligns your life goals to your current financial situation, as well as your expected financial situation in the future.

All in all, financial life planning is about some integral questions; what do you think will bring meaning and purpose to your financial life? What would you like to accomplish or experience so that in the end you will feel you have lived your life fully? What would you do if you had more time and money? 

It's all about helping you and your family mindfully plan for and realize your abundant life as a solo business owner.