I while ago I wrote a post gauging my own performance against the “Ric Edelman Secrets” …
I’ll leave you to go back and read the post and its comments as I think that they serve to show some of the differences between financial advice for the masses and the types of things that people who want extraordinary levels of wealth (if you’re reading this, that’s probably you!) need to consider.
In case you haven’t yet come across him or his books, Ric Edelman runs one of the country’s largest independent Financial Planning firms, so his firm has interviewed thousands of people looking for financial advice.
Ric says that when he (or one of his staff) asks the question of a new client “what are your financial goals?” the most common answers – by far – in this descending order of importance, are:
1. To buy a house
2. To save for (their kids’) college
3. To save for retirement
Now, here’s where I agree totally with Ric: these are not financial goals … they are inevitable outcomes!
Loosely paraphrasing Ric, here’s why:
1. Your house – you probably already have a house (most people do), and if you don’t, you won’t have to be prodded very much to go out and buy one – look at the sub-prime crisis to see how easy it can be to buy a house!
2. Your childrens’ college – if your children want to go to college, they will … one way or another, they will come up with the money. Sure you can improve on the situation by providing the funds to help them get into the college of their choice, but it’s a qualitative goal, not a ‘make or break’ in most cases.
3. Your retirement – you will retire … one day! Maybe not at the time, and in the manner that you would like to – but, you will retire (or die trying). It’s as simple as that!
So, why bother doing any financial planning when you already have – or will have – it all?!
Simple: it’s because these people haven’t yet developed a sense of their Life’s Purpose … to me that is the only goal worth aiming for … but, we have already discussed that subject, at length.