IN singer-songwriter Joni Mitchell's 1969 classic Both Sides Now, she sang these evocative words:
"I've looked at life from both sides now
From win and lose, and still somehow
It's life's illusions I recall
I really don't know life at all."
(To listen to Mitchell's rich voice singing her hit, check out https://youtu.be/yXr2EFomFkU?si=C9CoUFo0GpcIGG7R)
In truth, most of us don't scrutinise "life" enough to worry about understanding it; we're too busy caught up in the thick of "thin" things.
The majority of us are preoccupied with the actual business (busyness?) of living that percolates through, and eventually floods and saturates, our calendars, diaries and schedules.
As we mature and take on more responsibility, we find ourselves donning numerous "hats" that reflect many consecutive or concurrent roles, some of which may include child, spouse, parent, student, teacher, worker, saver, spender, investor, friend, relative, apprentice, mentor, confidante, grandparent, and so on.
Since we're often so busy focusing on each day's fresh circumstance or crisis that sprouts up in front of us, we miss the forest for the trees — thus failing to perceive the bigger and broader landscape of our holistic human experience we spend decades trudging through — because of the distracting irritants that pop-up in front of us.
That's why the role of financial planning is so important. It has the potential, when properly harnessed, to help us live intentionally, mindfully, and proactively.
PLAN WELL
Consider its definition: "Financial planning is the process of meeting your life goals through the proper management of your finances."
Burrowing into that illuminating definition helps us appreciate what I consider to be the top three factors of successful financial planning:
1. Our personally defined life goals;
2. The process that generates our self-defined plan, which is even more crucial than the often plain-vanilla products we subsequently use to implement personal financial planning; and
3. The money we have, use, save, invest, and spend throughout our lifetime... and beyond.
The American poet Robert Frost succinctly said, "In three words I can sum up everything I've learned about life: it goes on."
While that's true for our species as a whole, it isn't for us as individuals. Let's face it: One day we'll all expire and — in the words of Shakespeare's Hamlet — we'll "shuffle off this mortal coil".
Thankfully, therefore, most of us comfortingly believe in life after death. As prolific author and Christian preacher Max Lucado puts it:
"We see a hearse; we think sorrow. We see a grave; we think despair. We hear of a death; we think of a loss. Not so in heaven. When heaven sees a breathless body, it sees the vacated cocoon and the liberated butterfly."
I find Lucado's words hopeful. I also believe they are a source of comfort to each one of us who has ever lost a loved one to the unstoppable ravages of time.
Intriguingly, from the perspective of basic personal finance, it is worth noting that each of the three dimensions of financial planning, namely, Wealth Protection, Wealth Accumulation and Wealth Distribution, pertains both to life and death.
As wild as that sounds, it makes sense. Haruki Murakami, the bestselling Japanese author, observed:
"Death is not the opposite of life, but a part of it."
LIVING WELL
Consider this:
As each of us focuses on Wealth Protection, we use various forms of insurance. Medical-related insurance like critical illness and hospital and surgical coverage is harnessed to help us pay escalating medical bills while we breath.
However, the primary purpose of personal accident and life insurance policies is to help our survivors and dependants economically with cold hard cash after we pass beyond the veil.
And long before that, hopefully, when we structure our Wealth Accumulation activities, we start by budgeting so that we spend less than we earn, save and invest the difference and do so for a long, long time so we, our families, and perhaps others may live well.
Toward that end, often the residual wealth we leave behind after we die can be used to improve the lives of our loved ones, and to fund causes and charities we care about through Wealth Distribution instruments like a will and, more rarely, a private trust.
Vital note: The entire financial planning process provides us with a toolbox to use while we live and, as we've seen, to extend our influence well beyond our time on Earth.
So, in closing, as each of us wrestles with how we might use the versatile tools of financial planning to accomplish our life goals, we may also find these thoughts of American essayist Ralph Waldo Emerson helpful:
"To laugh often and much;
to win the respect of intelligent people and the affection of children;
to earn the appreciation of honest critics and to endure the betrayal of false friends.
To appreciate beauty;
to find the best in others;
to leave the world a bit better whether by a healthy child, a garden patch, or a redeemed social condition;
to know that even one life has breathed easier because you have lived.
This is to have succeeded."
© 2024 Rajen Devadason
Rajen Devadason, CFP, is a securities commission-licensed Financial Planner, professional speaker and author. Read his free articles at www.FreeCoolArticles.com; he may be connected with on LinkedIn at www.linkedin.com/in/rajendevadason, or via rajen@RajenDevadason.com. You may also follow him on Twitter @Rajen Devadason and on YouTube (Rajen Devadason).