Video Posted: Jul 30, 2025
This is John Smallwood, and I am back on Money Isn’t, and today I want to address how so many people spend first and think they’re going to make a plan later. And I find that to be reverse engineering. There’s a concept out there in which I get ready, I aim at my target, and then I fire. And what I find people doing in financial planning is they actually fire first, aim second, and get ready later, only to realize that they missed the target because they weren’t really looking at the big picture.
A common thing that I hear often is: “Oh, you’re a wealth advisor, you’re a financial planner, you’re a certified financial planner. When I have money, I’m going to come to you.” But I’ll ask, “do you have a job?” If you do, you have money. If you believe that you don’t have money right now, even when you have money, you’re not going to feel like you have money. Right?
The greatest investment that you can make in yourself is investing in yourself. Right? How do you invest in yourself? You invest in making a wealth plan. That’s one way to invest in yourself. You invest in your body by getting it as healthy as you possibly can such as losing weight, getting all your cholesterol and macros all in proper alignment. And you invest in your mindset. The order in which you do those things sometimes is not making a wealth plan first. Sometimes you need to invest in your mindset first. Right? Because if you don’t have a good mindset entering a plan, you’re not going to get a good outcome. If you’re, you know, in terrible physical shape and you’re ready to retire, you’re not going to have the greatest retirement. Right?
But the combination of investing in yourself in a wealth plan, in your mindset, in your physical side, the combination of those three things together, coming together at the same time, is what is exponential. Right? People’s perception of what a wealth plan is that they’re going to have to put some money somewhere and save some money, and that’s going to restrict their current goals. And the reality is, sometimes you overspend and you destroy your future goals because you didn’t see what was coming down the road.
As a financial adviser, we have this beautiful thing called the Wealth Curve. And the Wealth Curve is this visual representation. If I’m 30 years old, I’m going to 100, what are all the things that I want to achieve in that timeline? What is the financial pressure that I’m going to have? What are the taxes I’m going to be paying? What are the expenses, the goals? I want to buy a car. I want to buy a house. I want to start a business. I want to retire at 55. Well, you retire at 55 with a million dollars and a lifestyle of $80,000 a year. How long is that retirement going to be?
And I have hope that I now go and invest money with somebody that’s going to tell me they have the highest rate of return. And we know it’s the rate of return Olympics. Market volatility and taxation are going to destroy your wealth over time. The higher the volatility in a retirement plan, the worse that you’re going to be.
Now, I wanted to look at this and say: If you don’t make a plan today, 15 years from now you’re going to arrive at a destination. Where is that destination? Whose plan are you following? Is it somebody else’s plan or is it your plan? Now is the time to make your plan and get your plan set up. Even if you don’t invest anything. We have clients who come in, we have an engagement, small amount of money exchanges hands, and we make a plan. And the first 12, 18, 24 months is cleaning up all the messes. They’re not actually investing money.
I’ve had clients come in and go, “Well, I got $20,000 in the bank.”
I’m like, “Tell me more. Tell me more about you.”
“Oh, I got $15,000 on credit card debt at 18%.”
“So I got to get a bogey of 18% after tax just to break even Why don’t you pay the debt off?”
“I’m afraid to pay the debt off because I’m going to get back in debt.”
“But your money’s making 1% and you’re paying out 18. Do the math. You know, when you make a minimum payment on a credit card, up comes a screen: Do you realize how long this is going to take to pay off?”
You have to think about the big picture. You have to think about the consequences. Right? The beautiful thing about a plan is that when I build a Wealth Curve Blueprint, I’m getting a complete 100% snapshot of everything that I have. And people think they don’t have anything. But you do. You might have car insurance or homeowners insurance or renters insurance. You might be renting or owning an apartment. If you work for a corporation, you have benefits that you probably don’t know anything about. How do you maximize every dollar that you currently have, live the lifestyle that you want, and save money? That’s the goal of really good planning.
So if you’re on the fence and you’re afraid to invest your time and energy in making a wealth plan, I would say you’re not thinking of the big picture. You may not know where your plan is taking you and your plan could take you somewhere that you don’t want to be. Because most plans, even a good plan, can sometimes ends up where you don’t want it to be.
Right? There’s no guarantee that just because you made a plan that it’s going to execute. Because it requires you and I consistently executing on your plan and updating, reviewing, redesigning, rethinking, reconstituting, refiguring, and recalculating based upon all of the variables that are subject to change such as income, taxes, inflation, planned obsolescence, technological change, family. All these things are impacting on the wealth plan. You need to understand how they do it and how they have an impact on you.
On this podcast, depending on where you’re listening to it, you can navigate over to SmallwoodWealth.com and you can say, “Set up an introductory call.” It’s a free, no-obligation call with one of our qualified advisers that’s going to walk you through a conversation about you—your money, your taxes, your savings rate, your debt structure, your lifestyle, your current assets, your future assets, your future goals, and how your protection is. What do you love about your plan? What keeps you up at night? And what do you think the most important 90-day actions are? Let’s help you build a plan. See you soon.
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