Listening to talk radio while driving, an ad came on for a local company that offers heating, air conditioning, plumbing, electrical and handyman services to homeowners and commercial accounts. Since they offer a wide range of services, the owner of the firm, daughter of the founder, said her dad echoed the now famous saying, “Keep it simple, stupid.” Her appeal, recognizing that people really aren’t stupid, but since her firm could do so much, they’d “keep it simple” and offer a free on-site visit with you to see if your needs could be matched by their capabilities within your budget. No upfront “come ons” or sales sizzle, just an honest conversation about your needs, goals, desired outcome and potential solutions.
According to Google and Interaction Design Corporation, the phrase “keep it simple, stupid” is thought to have been coined by the late Kelly Johnson, an American aeronautical engineer. Kelly was the lead engineer at the fabled Lockheed Skunk Works which during the Cold War with Russia designed the SR-71 Blackbird spy plane. A highflying supersonic aircraft, it could soar over enemy territory taking pictures in a time before satellites or drones. The plane was operated by the Air Force and NASA before being fully retired in 1998. Able to fly at Mach 3+ at altitudes above 85,000 feet, the plane still holds the record as the world’s fastest aircraft.
Any aircraft is a highly sophisticated piece of equipment. Kelly emphasized that whatever the Lockheed designers came up with, it had to be maintained in the “theater of war” and “be repaired by a man in the field with some basic mechanic’s training and simple tools.” Kelly recognized a basic truth. People aren’t stupid but when they have a problem or a challenge, they don’t want to be overwhelmed by complexity.
Right now, you and others are dealing with challenges, some related to COVID-19, some just plain vagaries of life. Some needs must be attended to in the short run, say the next 12 to 36 months as you work you way out of pandemic economic strains. Other problems or needs may be longer term, related to the next 10 years or beyond. The last thing you need from an advisor is convoluted proposals and overwhelming complexity. But in coming up with a comprehensive plan, the quest for simplicity should not lead to a lack of options.
In working with a financial advisor, the initial conversation should focus on you, what worries you, what’s motivating you in seeking advice. With any challenge or problem, particularly those with financial implications, you want to understand the various alternatives available relative to a course of action. You may have multiple challenges, and priorities must be established.
The COVID-19 situation has many people rethinking priorities, what’s really important. We are thinking more about the loved ones in our lives and our ability to meet their needs and to deliver on promises made. Perhaps we need to review and update all living and testamentary estate plans, such things as wills, powers of attorney for assets and health care, advance directives, trusts, insurance policies, etc. We may be thinking of aging parents. Aging parents are thinking about their care over the next 10 to 20 years, about not being a burden on a spouse or adult children, about the potential financial and lifestyle independence of a surviving spouse.
You may be concerned with repairing financial damage and financial and/or career setbacks, debt reduction, building savings and a “freedom fund,” enough money or other liquid assets to sustain you for a year or more in case of a future income interruption. Retirees should have a Freedom Fund of three to five years able to generate cash and cash flow to sustain cost of living needs during a bear market interlude so ideally one does not have to sell stocks during a market dip.
Business owners see a need for rebuilding, revitalizing teams, incentivizing key people, having a comprehensive business growth and continuity plan that includes a succession plan for the owner(s) and other key personnel. The next 10 to 20 years is coming at us fast. No matter what you do for a living, don’t let short-term pressures crowd out the need for longer-term strategic planning. If you’re 50 or approaching another milestone birthday, do you have a plan for “what’s next?” Or if you’re 20, 30, 40, 60, 70, 80, or 90+ something?
A comprehensive planning process starts with simple, basic questions. Don’t let the scope of “overwhelming unknowns” slow you down in taking action. Albert Einstein framed it well. “Genius is making complex ideas simple, not making simple ideas complex.” Financial and life planning genius is making ideas actionable, ideas that address your particular challenge, your best alternative, harnessing the right resources, meeting your expected outcomes, what you wish to experience. It all starts with a conversation.
Lewis Walker, CFP®, is a financial life planning strategist at Capital Insight Group; 770-441-3553;firstname.lastname@example.org. Securities & advisory services offered through The Strategic Financial Alliance, Inc. (SFA). Lewis is a registered representative and investment adviser representative of SFA, otherwise unaffiliated with Capital Insight Group. He’s a Gallup Certified Clifton Strengths Coach and Certified Exit Planning Advisor.