Goals-based financial planning

Editor’s Note: A version of this article was originally published in the Fall 2018 issue of Private Wealth Management Magazine.

Financial Life

 

Miriam used to run a small nursing business. She loved her job and often told others how it fulfilled and centered her life. She always said she would never retire.

However, when she sat down with her wealth management professional from U.S. Bank and U.S. Bancorp Investments to talk about her goals, it gradually became clear that her job was not actually her highest priority. She really valued spending more time with her children and grandchildren, expanding her garden, and fulfilling her lifelong dream of traveling. Having a focused conversation helped Miriam recognize that these things were more important to her than the satisfaction she got from her work.

Our approach to wealth planning combines the expertise of the wealth management team with new digital tools and a goals-first financial planning focus.

Running through a few scenarios on her portfolio and retirement plan showed she could retire and still stay on track toward her goals. Miriam partially retired soon thereafter. She now works only a few days a week and spends the other days enjoying her passions.

“The last time I saw her, she was beaming,” says Brad Scott, National Practice strategy leader at U.S. Bank Private Wealth Management. “We were able to help her slow down, think and reevaluate how she was living versus how she wanted to live. We gave her the time and space to consider what her goals actually were; then we made a financial life management plan so she could start to work toward them.”

The U.S. Bank and U.S. Bancorp Investments approach to wealth planning combines the expertise of the wealth management team with new digital tools and a goals-first financial planning focus. With it you can build a comprehensive and holistic long-term plan that you can adjust whenever and wherever like Miriam did. Here’s how it works.

Start with your goals
Working with new digital tools and a wealth management professional from U.S. Bank and U.S Bancorp Investments, identify your highest priorities and then outline a framework to achieve each goal, including how and when.

“By understanding what you’re looking to accomplish in your life, we can figure out how your financial resources — including investments, assets, and liabilities — all fit together to help you as you strive toward those goals, dreams and aspirations,” says Jason Stamm, Central Region president, U.S. Bank Private Wealth Management.

Our goals-based planning approach focuses on the following:

  1. Create. Wealth starts with your business, profession, inheritances or other ventures.
  2. Grow. A wealth plan focused on your goals, as well as your feelings toward risk, may set you on the path to potential asset growth.
  3. Protect. Help protect yourself and your family against the unexpected as you pursue your goals.
  4. Impact. Direct your assets toward the people and causes in your life that matter most to you.

SOURCE: U.S. Bank

The overall planning process works like this:

  1. Engage with you to determine and prioritize your objectives.
  2. Design your personalized wealth plan based on your unique circumstances.
  3. Implement strategies that may include investments, banking, insurance and trust and estate services.
  4. Adapt your plan to help you meet your evolving financial needs into the future.

SOURCE: U.S. Bank

New technology complements the process by providing you with unfettered access to your financial plan. By logging in at usbank.com, you can:

  • Explore your goals. The online experience at usbank.com offers interactive tools to help you identify, prioritize and pursue the goals that matter most to you.
  • Manage your financial life securely. Your overview at usbank.com provides a single view of all your financial accounts. You can even see accounts you hold at other institutions.
  • Test your plan’s probability of success. You can instantly see how changing some of your expectations around large purchases or retirement timing can impact your plan. You can also test the impact of factors outside your control, such as potential market downturns.

SOURCE: U.S. Bank

These tools allow you to have clearer communications with your family and make informed decisions with the guidance of a wealth management professional from U.S. Bank and U.S. Bancorp Investments.

Define your needs, wants and wishes
Refine your plan by categorizing your goals into needs, wants and wishes.

  • Needs are your top priorities. These usually include making sure you have the income every year to meet your basic needs or desired lifestyle.
  • Wants come after your day-to-day needs. Specific goals, like philanthropy, often fall into this category. Keeping your vacation property in the family is an example; while doing so is important to you, you wouldn’t compromise your needs to accomplish it.
  • Wishes are dreams for the future. These are the goals that are not essential. They are ambitions you pursue when everything is going well. Examples could be a vacation through Europe or buying a boat.

The key is to separate your goals into these categories but remain flexible. “We often find that we don’t have to deal in absolutes,” Stamm says. “You don’t need to wait until your wants are fulfilled to work on your wishes. Your wants don’t need to wait for your needs.”

Speak with a wealth management professional from U.S. Bank and U.S. Bancorp Investments about our financial life management planning platforms and strategies.