By With the last day of school nearly upon us, I’m noticing for the first time in a couple years, other parents are starting to ask each other about summer vacation plans. After the travel hiatus most of us took due to Covid and with the current economic climate, it’s exciting to talk about upcoming adventures and escapes from the daily grind.
This type of respite from our busy lives and the opportunity to experience another corner of the world is certainly appealing. And if one has planned accordingly and set aside the funds, it can be relatively stress-free.
The reality though is that people tend to spend many more hours planning for where to take their summer vacations than they do planning for how to pay for them. Here’s your reminder: Every decision you make that involves money does in fact influence some other part of your financial life. Whether it’s vacationing with money you should be socking away in your emergency fund, remodeling your home when you should be paying off consumer debt, or using money that should be maxing out your retirement funds to buy a new car.
After working with hundreds of families during my two-plus decades in this business, I know very few of you can have and do everything you want in life without expensive repercussions down the road. It’s not just about making more money. It’s about living within your means, and once you’ve mastered that (no small feat!), determining what you want to spend your money on. It may be travel, a bigger house, an earlier retirement or making memories with your family.
The key here is that there is no one right answer. It comes down to your personal choices and what you want for your family. There’s a general misunderstanding with new clients that we perform financial planning based on certain rigid rules that can never be broken if you are to be financially successful. Now, if all of you had the exact same situation, we might be able to categorize you in a particular box. But, what I’ve been blessed to learn over the years of doing financial planning for you and yours, is that each of you is different. Each of you has different financial goals, outlooks and expectations. You don’t fit in a box. If we were to try to apply general financial principles to you in a rigid manner, a good number of you probably wouldn’t make any progress.
This is why, as we’ve built our team, the emphasis here at Family Financial Partners is on a collaborative approach with each family. While we are holding you accountable to certain principles so you don’t self-destruct. At the same time, our goal is to help you continue making progress as your life (or the economy) changes. It’s your money, it’s your life, and your decision — we are simply your trusted guide. We try to make sure you’re on the right path, and warn you if we see anything that could derail you.
As you consider what trips you’ll take (or put off) this summer and the level of financial commitment to each of those getaways, please consider what the end goal of each of those vacations is, especially right now as many costs are higher than we’re used to. If you’re wanting to head to the beach with your family, there are all sorts of beaches at all sorts of price points — you don’t have to fly to the French Riviera to enjoy the sand and sun. If it’s a lake day or weekend you’re after, well, Kentucky has 44 to choose from.
Whatever you decide to do this summer, be safe, have fun, and let us know how we can help you get financially ready.
Article by David Smyth, Senior Partner at Family Financial Partners — a financial services firm in Lexington, Kentucky.