Best Time To Create a Financial Plan? Now!

It’s not uncommon for people to wonder about the best time to create a financial plan. Ten years before retirement? Twenty? Five?


Are you on the right financial path? Contact Prism Planning Partners today!


Everyone Should Consider Having A Financial Plan Linked to Their Goals

In fact, people in Libertyville, IL (and beyond) should consider creating a financial plan now. Wherever you are in life. Yes, people whose retirement plan is ten to five years out need a retirement plan. So do people who are already retired, as well as those three decades and more away from retirement.

Why? Because financial plans, at their core, are nothing more or less than a review of your current finances linked with the life goals you want to accomplish, at whatever stage of life you are. Do you want to travel more? Establish or grow a business? Buy a larger or second (or first!) home? Do you want to play golf more extensively once you’re retired? Leave money to a worthy cause or establish a foundation?

Once you know your goals, you and a financial advisor can map out a blueprint for how to get there. 

Now is also a great time to create a financial plan because the COVID-19 pandemic and the economic conditions arising from it have made the need for a solid plan even more important. 

Many people, for example, have had their livelihood impacted. You may be working from home, or have been laid off or furloughed. Conversely, you may be in one of the businesses that saw increased demand, and this may be a good economic time for you. If so, it may be prudent to plan extensively for long-held goals. 

Moreover, COVID-19 has highlighted how important it is to plan for emergencies, which is one of the bedrock pieces of a comprehensive financial plan. Generally, an emergency fund of three to six months’ worth of salary allows people to ride out potential storms. 

Even if you were not affected financially, COVID-19’s impacts are far-reaching. For example, if you planned to travel abroad this year, those plans are likely on hold. If you or a loved one suffered a death in the family, your estate plan may need revision. (And if you don’t have an estate plan, it’s highlighted the need to create one.)


The Components of a Comprehensive Financial Plan

Many people hold off on financial plans because they aren’t completely sure what is involved in one.

A comprehensive financial plan focuses on six main areas, as follows.

Cash flow

A plan starts with an itemization of your spending and income, averaged over a period of time, such as a month. These are analogous to business cash flow statements but of your personal spending and income. 

People need to be aware of how much disposable income they have in order to maximize their achievement of goals. A cash flow statement allows this to become clear. 

It also increases awareness of what you are spending, and in what categories. If you need to modify your expenditures, a cash flow statement allows you to choose among categories.


Investments include all management of liquid assets that are not related to retirement. A financial planner can help you create an emergency fund, allocate your portfolio between asset classes to achieve your goals (such as stocks and bonds), and rebalance your portfolios periodically.


A financial planner can help you minimize taxes as much as possible, saving you from potentially costly mistakes. Tax planning to avoid overpayment and minimize taxes going forward is also part of a financial plan.


A strong retirement plan consists of knowing how much you will need for a comfortable retirement and establishing savings goals that will achieve that amount. Similar to regular investment accounts, your retirement funds need a portfolio allocation plan between asset classes like stocks and bonds and active rebalancing.

If you are already retired, you need to know how much you can withdraw comfortably per year from your account.


Insurance plays a crucial role in managing risk for your assets. It should not be overlooked, because the uncovered loss of your assets can affect your overall financial life.

You need insurance for all your assets, including your home, personal property, and vehicles.

Life, disability, and long-term care insurance are also vital considerations, most especially if you have others depending on your savings and ability to work. 

Estate Planning

An estate plan typically includes a will itemizing where and to whom you want your assets to go upon your death. If you don’t have a will and die unexpectedly, your family may not have access to your assets for months or even years, as your estate winds through the probate process.

Estate planning also includes powers of attorney for financial affairs and for medical decisions. Powers of attorney give individuals you designate the ability to make decisions on your behalf should you become ill or incapacitated.

Your Goals

These components should all work toward the achievement of your life goals. 

Part of developing a financial plan with an adviser is paying concerted attention to your life goals. Sit down and think about where you would like to be five years from now, 10 years from now, 20 years from now, and so on. What does your ideal life look like? What financial steps do you have to take to achieve it?




Working with a CERTIFIED FINANCIAL PLANNER™ Professional

The best method of creating a financial plan is to work with a CERTIFIED FINANCIAL PLANNER™ Professional in Libertyville, IL.

CERTIFIED FINANCIAL PLANNER™ Professionals receive instruction in all the areas of comprehensive financial planning and must demonstrate expertise to get the designation. Experience is mandatory. They work comfortably with other advisors, such as accountants and attorneys.

When you’re looking for a CFP®, it’s a good idea to look for one who lives and works in Libertyville and whose clients possess roughly the same net worth as your own. 

Why? First, because knowing your place of residence matters financially. Home prices, the employment picture, state and local taxes, and the regional economic outlook are all dependent on locality, and a CFP® who knows your area can give you better advice than one who may be less familiar.

Second, it’s important to find an advisor with experience relevant to your situation. High net worth families, for example, may have estate or taxation issues unique to their income bracket. Moreover, business owners may have special tax or succession planning issues that a salaried employee might not encounter. You want a CFP® with ample knowledge of the issues that can affect you.

At Prism Planning Partners, we are CERTIFIED FINANCIAL PLANNER™ Professionals committed to facilitating important questions so that we can help you explore all of your opportunities. We offer a broad array of financial planning and consulting services for our clients-including estate planning.

Contact us today and let us illuminate your possibilities!

Financial Life Planning: 6 Steps for a More Confident Retirement | Prism Planning Partners eBook

Prism Planning Partners, LLC dba Prism Planning Partners is a Registered Investment Adviser. This article was produced by Paladin Digital Marketing, an entity unrelated to Prism Planning Partners and may not necessarily reflect the expertise of this financial advisor. This publication is not intended to provide investment advice and is intended for your information only. Opinions and forward-looking statements expressed are subject to change without notice. Information based upon third-party sources and data are believed to be accurate and reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. All domestic and international rights are reserved. No part of this publication including text, graphics, et al, may be reproduced or copied in any format, electronic, print, et al, without written consent from Prism Planning Partners. Neither Prism Planning Partners, nor its investment advisor representatives provide legal or tax advice. Please be advised to consult your investment advisor, attorney or tax professional before making any investment decisions. 
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.