Four Core Financial Planning Philosophies

Today’s Wisdom:

Joel and the team have returned back to the office now that the northeast is beginning to open back up, and people are curious how the planning process might be changing. While some things might be shifting, our four core philosophies will remain entrenched in everything we do.

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What You’ll Learn:

The big news over the past week or so is that the state of the Connecticut and the northeast is beginning the process of opening back up. That’s exciting news for us because it means the team is coming back into the office again.

As things begin to move toward normalcy again, people have been curious about how the financial planning process will change as a result of everything we’ve been through. The short answer is it won’t, but let’s explain that a little deeper in this episode of Money Wisdom.

It’s important to begin with our behaviors following a financial crisis. No matter what we go through, we forget about the crisis way too quickly as a country. And after all we’ve been through this year already, you’d think there would be more worry when talking about financial planning. We’re not seeing that though.

But that doesn’t change what we do when working with clients to build a financial plan. Everything we talk about is based on these four core philosophies:

  1. Safety first – Have some money that can’t go down when the market goes down.
  2. Reasonable rate of return – Most clients aren’t looking to us to make them rich. They want us to keep them from being poor.
  3. It’s all about income – We want to make sure you have income created in retirement that isn’t dependent on someone’s job, Social Security, pensions, or so on.
  4. Keep it simple – Making sure clients understand their plan and their investments.

It doesn’t matter who you are and how many assets you own. This process is the same for everyone is that’s why we want to reiterate that on this episode.


We’ll close out today’s show with a few mailbag questions from listeners so thanks for sending those in. Let’s start with someone that is thinking about beginning their own business but would need to pull money out of an IRA. By doing that, they’ll be paying taxes and penalties but still feel confident about their ability to be successful. The answer for this is going to be different for everyone but Joel will share some considerations to make and things he would ask her.

The second question comes from a listener that just received an inheritance in the form of a $350K IRA. With the SECURE Act wiping out the Stretch IRA, let’s talk about what he needs to know about this account and withdrawing money. Then we can discuss where to invest it.

Finally, we have a listener with two 20-something children that are living at home and were recently furloughed. Unfortunately, this is probably a common situation around the northeast right now. He wants to support them financially as best he can and is considering ways to do that. Joel, however, doesn’t recommend doing this and he’s going to explain why.

[0:34] – Joel and his team back in the office again.

[1:46] – Are people shaking the complacency and ready to get going again?

[2:56] – How is the financial planning conversation different now than it was before?

[5:46] – The four core philosophies we preach

[9:36] – How are these philosophies woven in to conversations with clients?

[14:23]Mailbag Question #1: I’m thinking about starting my own business but I would have to pull money about $75,000 out of my IRA, which would require paying taxes and penalties. I’m not scared of those penalties but interested to hear your take on it.

[17:09] – Massive wealth is built without diversification.

[19:09]Mailbag Question #2: My mom passed away and left me about an IRA of about $350,000 in it. What do I need to know about this account and how should I invest it?

[20:44]Mailbag Question #3: My kids are both in their 20s and have been furloughed. They live with us so expenses are limited, but I’m wondering how to best help them financially during this time.

Thanks for listening to this episode. We’ll be back again next week for another show.



Final Thoughts:

“There’s way too much complacency and over-confidence right now and it’s going to be felt in a real bad way.”  

– Joel Johnson, Money Wisdom Podcast

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