In our day to day work as financial advisors for our team, we are very familiar with the families we work with and all the facets of their real life. Marriage, first homes, births, college, divorce, and death - we see it all and because of the personal nature of our relationships with the families we serve, we see what works well and what works less so in life.

In doing financial planning and helping families reach their financial goals there is a tremendous focus on wealth accumulation in the younger years, but then there’s that aha! moment when a family understands that they have enough to be financially independent, and the next aha! moment when they realize that they will not have excellent health nor live forever when a close family friend or relative unexpectedly passes away. This is usually when we get the call that an update to their will is in order. The unspoken assumption though, the flaw in financial planning if you will, is the assumption that you will have good health throughout the life of your plan, yet we know from watching retirees in real life that the “doing” and the spending in retirement is usually fullest and highest for the first ten years or so as families have the money, time, and health.

To put it another way, we have four assets: time, money, relationships and health; and if you ask most people they will tell you that relationships matter most. What is interesting though is that in the life cycle of planning, although your assets can grow through your life if you have a sensible spending rate, your time and health are guaranteed to be diminishing. We don’t talk about this enough in the technical aspects of planning, instead we talk a lot about tax, withdrawal rates, trusts, etc.

So how best to live and enjoy the fruits of your labors, focusing on what really matters? Think of it this way, you have a pot of capital that is designed to serve your most important objectives in life. Relationships, experiences and supporting the good causes you wish to contribute to while doing it at a time when you can enjoy them and when those you help can say thank you to you and your spouse. Recognizing these realities will help in making financial decisions where the best decisions are made by analyzing the money component and the life or real world component, when we are aware that we can only do certain things at certain times with those we love.

A final thought, no one ever comes in to see us at age 75 and says “please help me complicate my financial life, I feel like I need more accounts, more advisors and more statements to keep track of!” No, they come to a recognition that time is precious and they would rather be spending it with those they care about rather than sorting tax slips, statements, bills, and managing complexity.

Do yourself a favour and simplify your financial life, you will be glad you did.

Randy, Ian and Harrison