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Investor’s column: Here are several pitfalls of having no financial plan

There are some things in life you can’t plan for: an unexpected illness, job loss, death of spouse, disability, accident, etc.

While these major events can have a huge adverse impact on your life, if you have an effective game plan in place, it can help ensure that such an event doesn’t ruin your financial well-being as well.

Let’s say you choose not to have a financial plan. How does that decision impact the confidence you want/need for your future?

There are four major pitfalls that impact those who fail to have a financial plan:

Emotional decision-making

Many investors choose not to follow a plan (or deviate from their plan) because they fear the stock market and want to jump out of it when there’s a market downturn.

An effective financial plan is designed to help you pursue your financial goals even through unstable market conditions.

In fact, when you have a plan in place, you’re helping to protect your assets when markets go down while also affording yourself the opportunity to experience potential growth when markets go up.

Karin Grablin mug shot.jpg
Karin Grablin is with SRQ Wealth in Sarasota.

Missed opportunities

For those who fail to plan, regret tends to follow. A financial plan will help you save money so you can do the things you want to do in the future: buy a second home, send your kids/grandkids to college, start a business, travel, etc.

Beyond your predefined financial priorities, an effective financial plan can help you pursue goals that you don’t even know exist now but may arise in your future.

Workforce woes

As retirement approaches, for those who have not implemented a financial plan, many find their retirement nest egg is insufficient and are forced to stay employed longer than they wanted.

According to a U.S. News & World Report study from May 2018, the number of older Americans foregoing traditional retirement is on the rise, and those numbers will continue to go up.

On the flip side, some workers are forced out of employment at a certain age, regardless of whether they are ready to retire.

In a research study featured in USA Today in May, 37 percent of U.S. workers retire sooner than they expected.

With either scenario, proper planning can lessen the financial burden.

Running out of money

What do retired Americans fear the most, even more than death? According to U.S. News & World Report, it’s outliving their money.

This also includes those who are considered to have high net worth by most standards.

When you factor in longevity, inflation and rising health care costs, it’s a valid concern.

In a report published by the Employee Benefit Research Institute in January, this could be the reality for up to 83 percent of Baby Boomers.

To offset your risk of running out of money during retirement and prepare for the rising costs of health care, follow your financial plan.

Your financial plan should also include a spending strategy so you know how much money you can spend during each phase of retirement — that way you can enjoy your years in retirement without worry.

No one knows what the future holds. Don’t let the fear of the unknown be the driving factor in making life’s trade-off decisions.

Instead, gain the confidence financially planning provides in handling unexpected life events.

Karin Grablin, CPA, is with SRQ Wealth, 2033 Main St., Suite 103, in Sarasota. She can be reached at 941-556-9004 or visit

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