Put it in Writing!

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A new report by Charles Schwab appears to have unlocked the secret to successful retirement planning: put it in writing. The report found that people who have a written retirement plan were 60 percent more likely to increase their 401(k) contributions and twice as likely to stick to a monthly savings goal. The only problem is that just 24 percent of Americans have a written financial plan.

Acting vs. Reacting

We at Concentus have a core belief that the only appropriate medium for an investment portfolio is a written, date and dollar specific financial plan. An investment portfolio is never an end to itself, it is only the means to the goals of a written plan. Long term investing success always stems from acting on a plan, as opposed to reacting to markets – we prefer a “Plan” to a “Market Outlook” every time.

No matter how long you live, or how much money you accumulate, there is likely to come a day for all of us when it is time to harvest from your wealth. When you and/or your family will begin to draw living expenses from your investments, because your work days are either over or are dwindling. You may not formally “retire”, but most people strive for a state of “Financial Freedom” – a day when you could live from an income stream from your investments.

When that day comes, there are really only two possible financial outcomes. Option A is the money outlives the people. This way lies perfect happiness for those who are confident that they are in process of being outlived by their money, because this knowledge allows us to preserve the two most important qualities of life we all seek: our dignity and our independence. It also allows us to intervene meaningfully in the lives of those we love, and or to leave a legacy to a beloved cause or institution if we wish.

Option B is the people outlive the money. This way lies the gradual erosion, and then extinction of all dignity and independence.

The door you get to walk through when that time comes, is largely dependent upon whether or not you have adopted a written, date and dollar specific wealth plan, which you follow in a disciplined way over time.

Always remember – in a world where everyone in financial services is jumping up and down and screaming at the top of their lungs to get you to buy their financial products, it doesn’t matter what products you own, what really matters is the act of creating a date and dollar specific written plan. Put it in writing.


About the Author:

Erik is one of the co-founders of Concentus Wealth Advisors and currently serves as the Chief Executive Officer of the firm. With over 25 years of industry experience, Erik guides the firm’s overall strategy. After graduating from Amherst College in 1991, Erik spent a year working with Rittenhouse Capital Management, before joining Gerald in 1992. Erik currently holds his general securities registrations and insurance licenses, as well as CERTIFIED FINANCIAL PLANNER™ and Chartered Financial Consultant designations. In addition to his formal designations, Erik has appeared on CNBC’s Worldwide Exchange, Fox News’ America’s News HQ, Live Well’s Mary on Money, CN8’s Money Matters Today and The Real Estate Connection. In 2012, Erik was one of thirteen advisors named to Main Line Today’s Top Financial Advisors list. Erik lives in Bryn Mawr, PA with his wife and three children. He serves on the boards of the Philadelphia Chapter of the Salvation Army, Acting Without Boundaries (serving young people with disabilities) and The Holy Child School at Rosemont. In addition, he is on the financial advisory board of the Sisters of St. Francis in Media, PA.

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