By Joey R. Johnson

Finical Planner assisting a couple

“A dream written down with a date becomes a goal. A goal broken down into steps becomes a plan. A plan backed by action makes your dreams come true.”
— Greg S. Reid

Few would embark on a journey without a clear set of directions. Long gone are the days of printed maps, for most of us at least, but Google Maps and mobile apps like Waze provide us with step-by-step directions to get from Point A to Point B the most efficient way. Similarly, a complicated meal requires a detailed recipe and furniture or toy assembly is likely to be more successful with a clear set of instructions. Having direction is important. It gives us the security of knowing we’re on the right path.


Let’s put this desire for direction and security in the context of finances. A map to help us get from Point A to Point B with respect to our financial goals can be an invaluable tool. Regardless of where we are on the financial spectrum, recognizing that point and knowing what steps are necessary to get where we want to be is of utmost importance. But what exactly does that mean? Does it mean having a monthly budget to track where our money goes? Of course. But it also can mean much, much more.


Thinking more broadly, most of us have short- and long-term financial priorities as well as needs for the future. Things like saving for college or retirement are most common. How much do we need in savings to maintain our current standards of living once a paycheck is not coming in regularly? Perhaps there are considerations of buying a vacation home or a luxury yacht. How will such large purchases affect our families in the long run? Is it better to pay in cash or strategically use credit to finance large purchases? And of course, what happens when we pass away? Have we taken the appropriate steps to protect our families in the event of a tragedy? These are all very provocative questions. A good financial plan is powerful because it allows us to know the answers.

Clearly these issues go far beyond the monthly budget and most of us cannot quite adequately answer these questions on our own. We scribble figures and quantify as best we can, but when it comes to planning for the future and seeing the impact of inflation and other economic complexities on the decisions we make, most of us doubt the accuracy of our estimates. How do we know we’re on the best financial path? Cue the entry of professional guidance and financial planning.


According to the CFP Board, “…financial planning denotes the process of determining whether and how an individual can meet life goals through the proper management of financial resources…” (1). Financial planning helps clients clarifying and quantify financial goals, and provides recommendations on actionable steps necessary to reach those goals. Having this greater understanding of your financial picture provides knowledge about what should be done to enhance your quality of life. It’s a roadmap for our journey that we should never leave home without.

lightbulb with arrow going up with gears attached to the line ending with a man drawing a $ signFinancial planning began with Loren Duncan, a mutual fund salesman with a desire to do more than sell financial products. His novel idea was to provide his clients with advice to help them make sound financial decisions. The idea was revolutionary, and Duncan realized he alone could not take on this task. Beginning with the addition of James R. Johnson, he built a team of 13 professionals, and in December of 1969 the College for Financial Planners and International Association for Financial Planners was born. Nearly four decades later, there are over 120,000 Certified Financial Planners around the world helping their clients develop financial goals and providing guidance so they can make the best financial decisions possible. (1)


A great example of the power of financial planning can be exemplified in one particular client we will call “the widow.” Her husband, who always handled the finances passed away and she had not paid a bill in decades. She didn’t know how much income she had, the balances in her savings accounts or whether she had enough money to survive. She was saddened by the loss of her husband and scared she would be unable to pay her bills. Our team of Certified Financial Planners walked her through the financial planning process, helping her become comfortable managing her finances and easing her fears of the unknown. Upon completion of the plan, the team of professionals helping her was thrilled to tell her s he would be OK. She would not run out of money as she initially feared. She had more than enough to meet her needs. Much, much more than enough! When she burst into tears at this revelation, her planning team was taken aback. They were delivering good news. But the widow explained her regret for not having gone through a financial planning process before her husband passed away. Had she understood how well they were doing financially, she would have gone out to eat more, taken more vacations and given more to the grandkids while her husband was alive so they could enjoy these wonderful things together.

As the old saying goes, knowledge is power. Financial planning provides knowledge that we’re on the right path, heading in the right direction, on the most efficient course to get from Point A to Point B. The knowledge we’re making the right decisions to attain our goals and make dreams come true. That knowledge is the power of financial planning.


1 The History of Financial Planning by E. Denby Brandon, Jr, H. Oliver Welch & Marvin W. Tuttle, Jr.

About the Author

Joey E. Johnson

Joey E. Johnson

Wealth Team Director

Joey manages a team of Wealth Advisors that help clients take a comprehensive, strategic approach to financial planning. She maintains the Series 7, 63, 66, 24 and insurance licenses and has more than16 years of financial services experience. Joey earned a degree from the University of North Carolina at Chapel Hill.