As the year comes to an end, it’s common to dig deep into analyzing the past 12 months. We think about our successes and failures and how we’d like to see things change in the upcoming year. Financial aspirations tend to top resolution lists, though creating actionable goals can often be difficult for many of us.
Financial planner Regan Stephenson discusses how she helps clients examine their previous year’s finances and close out the calendar year in the most efficient manner possible through planning end of year expenses, maximizing 401(k)’s and pensions and other tax planning opportunities.
Another critical focal point should be setting goals for the upcoming year. By shifting the focus from the past year to the future, Stephenson is able to help her clients become forward-thinking. They can then create a strategy for what they can and want to accomplish together. “It’s important to maintain accountability for the previous year’s wins and losses, but equally important is addressing what we can control—the upcoming year,” Stephenson said.
Stephenson works with clients to develop 1-, 5-, 10- and 20-year goals, both professional and personal.
“It’s like a puzzle,” says Stephenson, “we lay out the pieces of the client’s professional and personal goals and see how financial strategy can complete the picture.”
Don’t know where to start? Sitting down with an advocate that knows the ins and outs of the dental industry can offer access to insights that help you brainstorm methods to reach your personal and professional goals in 2018. Take these popular goals for example:
1. Increasing income – For her clients looking to achieve specific growth metrics, Regan initiates a plan with step-by-step measures to be successful. For instance, some practices might consider offering a new service or product like Invisalign® or dental implants. In other cases, adding an associate and increasing production might be more appropriate.
2. Creating a better work/life balance – While financial goals typically top the list of resolutions, personal goals like a healthy work/life balance are essential to satisfaction in ones’ day-to-day lives. In this situation, Stephenson may look at her clients’ personal financial plan, and decide if they can support their savings goals while still absorbing the reduction in monthly income that comes with less days in the office. Do they need to reduce their monthly spending budget, or could they add an associate to continue the production on the days they are out of the office? Consolidating services to specific days of the week or planning time for vacation and continuing education helps keep focus on their days in the office and relaxed on their days away.
3. Working towards an annual savings goal -Everyone knows they should save first. However for many, cash flow struggles delay their ability to start saving. Stephenson finds ways to allow clients to start saving through strategic tax planning. People are often times saving to the wrong place, one that may not offer the most advantageous tax savings. Through saving into tax-deferred vehicles like 401K plans, tax benefits help provide the opportunity to save more. Implementing other tax strategies and restructuring debt also can free up cash flow to start saving.
Strategy and goal-setting are critical to success, but without accountability, good intentions often take a backseat to the busy day-to-day tasks of a dental practice. Tracking progress regularly is important. Regan sees many clients get creative from scheduled monthly checkpoints to keeping a visible list of goals so they stay top of mind. She keeps regular contact with her clients to help ensure they are on track to meet the goals set at the annual review.
Start 2018 off right by setting financial goals to help direct your spending and saving throughout the year. Contact your financial planner and get started on creating your personalized plan for financial fitness. If you aren’t working with a planner yet, contact CWA for a complimentary consultation, and see what a difference looking ahead can make.