I have a dear friend who recently planned a trip abroad with his wife for a long awaited and well deserved get away. He sent me his proposed itinerary because I was planning a similar trip sometime after he returned. Their itinerary included all the places they wanted to visit, how they would travel between the various locations and where they would sleep. When they returned they described the amazing time they had and all the unique events they experienced. While the great weather definitely helped, the main reason the trip was such a success was because of the great deal of homework before the trip that enabled them to maximize their time, and see and do the things they wanted to do.
And while some people really enjoy the planning stage as the anticipation and preparation become part of the journey itself, I personally don’t relish spending hours and hours prior to a trip preparing all the detailed plans. I often like to create a less structured trip plan where there is more opportunity to be spontaneous or react to the surroundings and goings on. Often brainstorming with other guests and locals can enable one to benefit from their experience and advice. But without a basic framework and plan, being too spontaneous can result in the vacation being one long missed opportunity.
Another friend took a similar trip but went to the opposite extreme. Not having enough time to plan before they left, they booked a last minute trip and assumed that the details would all work themselves out. They would find a last minute hotel and arrange somewhere to find kosher food and have a great time. But after the flight was booked, they tried searching for a hotel and found that almost all hotels had been booked because of a major conference in the area. Instead they ended up staying far away from the area they had wanted.
Each day was another adventure – sometimes a lot of fun, but other days less than ideal searching for kosher food, trying to figure out how to do the things they wanted to do. In the end, they enjoyed the vacation tremendously, but they had this nagging feeling that they could have got so much more out of it than they did and for far less money.
You may be wondering why I have spent most of this “financial article” describing these vacations, when I really don’t have any intention of becoming a tour guide.
I chose to use the vacation example to illustrate a few basic points that are the key to proper financial planning and management. Properly planned vacations involve several hours preparation and save a tremendous amount of time and money. Yet people procrastinate and often find themselves not having invested enough time planning that dream vacation.
Our lives comprise countless elements that need to be planned, but whereas planning a vacation should be exciting and motivating, people tend to be less enthusiastic about setting long term financial goals and formulating investment plans. Take retirement planning as an example. If you don’t plan it properly how do you know that you will be able to live comfortably during what should be your ‘golden years’.
Here are a few points for you to implement now and thus avoid long term damage.
- Ensure you have a financial plan and adjust it periodically to ensure it is still relevant to your lifestyle, and long-term plans. Without that plan any efforts you make are far less effective and you risk wasting time and resources on low priorities while losing focus on the important things in your life.
- Talk to others. Benefit from their experience. Use whatever media you are comfortable with to educate yourself. Address the right questions to the right people and leverage the knowledge available around town.
- Don’t worry about fomo (fear of missing out) especially if you need to say no to current wants/needs in order to save for the future. Plan your unique path based on your specific circumstances.
Virtually every aspect of our lives can be improved by proper planning; we all know that. If you know that you aren’t going to manage to plan all the different elements, make sure you invest enough time and resources on the crucial ones that definitely need our time – and your finances pretty much top that list. BeHatzlacha!