The Role of a Financial Plan in Wealth Management

Benjamin Franklin once said, “by failing to prepare, you are preparing to fail.” No doubt, the Founding Father’s advice is applicable to many areas of life today, financial planning being chief among them.

Financial plans are often viewed as a tool for the wealthy, but they should matter to everyone. The reality is that managing finances is difficult — whether you have complex investments or are just starting out and paying off debt. Partnering with a professional to help you determine a plan of attack can make it a lot less stressful.

Working with a professional to build a financial plan helps you:

• Better understand what you want to use your money for.
• Remain accountable for following the plan.
• Stay in tune with your financial reality.
• Worry less about money.
• Eliminate confusion around your finances.

With a financial plan thoughtfully developed around your financial reality — your wants, needs, and challenges that may exist along the way —  you have a roadmap to follow to help reach your goals.

Investing is a Long Game

The Centers for Disease Control predicts the average life expectancy in the U.S. to be 80 years for women and nearly 75 years for men. While these are only predictions, those figures highlight that your future could be long, so it is important to plan that way--for this reason, professional wealth advisors consider a client’s overall risk tolerance and investment horizon when creating a financial plan. Planning strategies like the Monte Carlo simulation, which calculates the probability of long-term success across a number of market possibilities, are one method advisors use to manage investment success over an expanded time horizon. In any case, different financial situations require different plans, but one thing is true for all of them: success does not happen overnight.

Never Too Early to Start

One key to successful financial planning for the long term is to start early. Although retirement may seem far off to a 20 or 30-year-old who is just starting out, that is exactly the time to start planning how to finance your golden years, not as you are nearing retirement or after you are already there. The U.S. average for retirement expenses is over $835,000 for a 25-year retirement and over $1M for a 30-year retirement, and that varies from state to state.

Discipline is Key

When investing, it’s tempting to check your portfolio daily for growth. Or worse, to watch market activity and make knee-jerk decisions. As discussed earlier, when building investment strategies for their clients, most professional wealth advisors use the Monte Carlo Simulation, since it accounts for the likelihood of up and down years in the market. Strategies like this should provide you with the confidence and peace of mind to stay the course during hard times and let your portfolio do the work.

Finding the Right Portfolio Construct Through Holistic Planning

Retirement is the big life event that comes to mind for most people when they think about financial planning. But there are other life events to account for, like college savings, insurance, estate planning, charitable giving, or succession planning if you own a business. Look for a financial advisor who understands your unique needs and has access to the right network of experts in several disciplines who can help design a plan to meet your financial goals.

At Synovus, our financial advisors leverage a team of experts to help them construct a long-term plan tailored to your goals and risk tolerance profile. As the quarterback of the plan, the advisor leverages the comprehensive depth of expertise across the firm to plan the development and ongoing execution of the plan. The team works with the client to make necessary tweaks along the way, accounting for changes or additions to goals, unforeseen changes in the client’s circumstances, tax policy shifts, Congressional changes or other scenarios that could impact the plan’s long-term sustainability.

For additional information on Synovus’ financial planning capabilities or to work with an advisor, please visit us at synovus.com/wealth/private-wealth-management/.