The forgotten element in financial planning

Greetings!

I'm going to call this newsletter "Tom versus the stock markets." I will keep this brief because I have written a lot about the stock markets recently. And then I'm going to finish with something much more important.

As a broad measure of how my clients' portfolios are doing, I track the total dollars that I manage for all me clients. With the recent market drop, I want to compare this total to what the stock markets have been doing. I have numbers for the period September 9, 2008 to October 24, 2008. For this period--

--the total dollars that I manage for all my clients has declined 15%

--the stock markets in Toronto and New York are down, on average, 26%

I believe that my "cushioning" of the stock market drop reflects my more conservative, pension-manager approach. And this approach will serve us well as poor markets come to an end followed by recovery. I don't know when this will happen. I do know that the doom-and-gloom that we find in the media will continue right through to the recovery. Stock market recoveries do not announce themselves: they arrive in fits and starts so that, only in hindsight, do we see their beginning.

So while we wait, let's turn to something more important. It's what I call the forgotten element in retirement planning. Retirement planning tends to focus on crunching the numbers to see what we have to save in order to reach our goal later. That's important, but what are we really pursuing?

We are pursuing a freedom to balance play and work in a way that is meaningful to us. For some, retirement means continuing a rewarding career but also playing as much as they want. For others, retirement means all play and no work. For everyone, it's the play that we look forward to whether it's learning to sail, travel, and so on. And what is the most important ingredient that enables play? Is it money?

I submit that the most important ingredient for play is good health. This is the forgotten element in retirement planning: without good health, play can be very restricted. If you agree with me on this, you may also agree that good health is a lifelong pursuit: you can't wait to develop good health, you must build it into your lifestyle now through exercise and good eating. Lord knows I struggle with this, but I try to remember just how important it is. All the saving in the world might not come to much if we haven't looked after ourselves.

One last point. Good health, unfortunately, is not a guarantee and if we are blessed with good health at the moment, then let's take advantage of it by doing some of the things, now, that we hope for. Want to learn to sail? Whatever your passion, why not sign up and get started?

Happy sailing!

Warm regards,

Tom

Tom Buck, M. Ed. CFP
Certified Financial Planner
Assante Financial Management Ltd
#600, 1414-8th Street SW
Calgary, AB T2R 1J6
TEL 403.229.0128
FAX 1.866.386.9776