Podcast Episode 304: Financial Hindsight is 20/20

Like anything else in life, financial planning is much easier to do in hindsight. We all have a few (or more) decisions we’d like to go back and change if we could. Let’s talk about a few of the regrets people are probably coming to terms with today.

As financial planners, we talk with people all the time who made decisions with the best of intentions that weren’t the best in hindsight. Understanding how to avoid common financial regrets can help people achieve their long-term goals.

The global financial crisis of 2008 is the first example of this. It caused many people to become overly conservative with their investments out of fear of losing more money. So many people put money on the sideline and kept it there. However, keeping too much money in cash or bonds meant missing out on the strong market recovery and bull market over the following decade. While it felt safe at the time, it meant slower growth and lost opportunity.

More recently, the market downturn of 2022 was a reminder that risk is always present in investing. A lot of people were enjoying the bull run and not thinking as much about the potential downside to their investments. Once that downturn hit, a lot of people quickly realized they had more risk in their portfolios than they were comfortable with. A comprehensive financial plan helps you understand that risk and make informed decisions even in challenging times.

Another great example of hindsight comes with Social Security. People often claim their benefits early, at age 62, due to a need for income or a desire to stop working. But a few years into retirement, some of these same people wish they would have waited a little longer and built up that benefit. For many, it is a better choice financially to delay claiming Social Security for as long as possible, but the more you save, the more flexibility you’ll have.

While there is no way to predict the future with certainty, thinking through financial decisions with the help of a professional advisor can help you gain perspective and make choices that align with your goals. Avoiding common regrets and understanding the long-term impacts of your decisions can make a significant difference in your financial outcomes. That’s what we can help you with so take advantage of our complimentary Money Map review to get started.

Here are some of the things we discuss in this episode:

1:16 – Did you miss the long bull run following 2008 because you were too worried and conservative?

3:32 – Not understanding how much risk you had until 2022 hit

6:36 – Regretting starting Social Security too early

11:10 – CEO’s Corner with Joel Johnson – Advice he’d give his younger self

19:43 – Mailbag question on what to do with excess income in retirement

21:48 – Mailbag question on raising your savings goal because of retirement