Financial Planning Fundamentals || Thomas Callaway

Thomas Callaway
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Financial planning can help you better understand where you are financially, how to prepare for the challenges ahead, and how to plan where you want to go. If you haven’t prepared a financial plan for yourself or your family, a financial advisor can help. Here are the typical steps in the planning process:

Goal setting. In this fundamental step, your financial goals take center stage. This is an opportunity for you to identify what you hope to accomplish in your life and when you would like to get there. For example, you might want to own a house in three years and start a family in five years. Or you may want to go back to school to pursue higher education, which may have short-term costs but help you earn more in the long run. Or you might want to retire early and travel the world. In order to achieve any of these goals, you must first name them.

Fact finding. During this phase, you will gather numbers to see how things add up. Your financial advisor may ask you questions to calculate your personal balance sheet, which estimates your net worth based on assets and liabilities. Your income, spending habits, monthly bills, and unpaid debts should all be on the table. The price of future goals should be quantified, so you can determine what you need to save to afford them. If your goals don’t match the reality of your financial situation, one or the other needs to change.

Creation of plans. A comprehensive financial plan outlines how to achieve personal and professional goals within the context of actual income and expenses. With a clear line of sight to your financial situation, you can look for opportunities to cut unnecessary spending and redirect money to your goals. Your financial advisor can also provide you with investment strategy, asset allocation and portfolio recommendations based on your individual goals and personal risk tolerance to help you optimize your finances.

Implementation of the strategy. This is where things get real. If your plan requires you to save a certain amount of money each month, that’s up to you. If achieving your goals means you need to increase your income, now is the time to put in the extra effort to get that promotion or change your field for increased compensation. Your financial adviser can help you select savings vehicles suited to your investment objectives.

Ongoing plan reviews. Ideally, your financial plan is a dynamic document that is periodically adjusted to reflect your life situation. Your financial advisor will recommend at least one annual meeting to check on your progress towards your goals and refine your financial plan.

Financial planning takes work, but the process can be very rewarding. Bigger goals become easier to achieve when you can take small steps towards them. It’s never too early or too late to put a financial plan in place. A financial advisor can help you create your plan and manage your investments to help you achieve your life goals.

Thomas A. Callaway CRPC®, is a financial advisor at Ameriprise Financial Services, Inc. in Paris TX. He specializes in fee-based financial planning and asset management strategies and has been practicing for 28 years. To contact him you can go to or call (903)785-7000, office located at 2219 Lamar Ave Paris TX 75460.

Investment advisory products and services are made available through Ameriprise Financial Services, LLC, a registered investment adviser.

Investment products are not insured by the FDIC, NCUA, or any federal agency, are not deposits or obligations of, or guaranteed by, any financial institution, and involve investment risks, including possible loss of capital and a fluctuation in value.

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