A new survey finds seven out of 10 people only plan their finances for the short-term but, thankfully, more and more are taking a longer-term perspective.
deVere Group, one of the world’s largest independent financial advisory firms, asked participants the following: “Do you plan your finances one year ahead, one to three years ahead, or three years or more ahead?”
Fully 71 percent responded with the first option. As deVere notes, when the same poll was carried out two years ago, 82 percent of respondents claimed to only plan their finances one year ahead.
“It is encouraging that this poll finds that people appear to be increasingly planning their finances for the longer-term,” Nigel Green, deVere Group CEO and founder said in a statement. “However it is alarming indeed that still seven out of ten people across all ages, income brackets and nationalities who are without a financial adviser are exclusively thinking about their finances in the near term.”
Green adds that it’s almost universally recognized that longer-term financial planning makes it easier to reach financial objectives – which for most is financial security – because of more time and considerably more opportunities.
“Many people believe the myth that planning for the longer-term is more difficult than planning for the short term. This is not true,” he argues. “The difficult part is starting to plan long-term. But procrastination will leave you in limbo and is likely to cost you dearly.”
He concludes that long-term financial planning has never been more important because governments are being forced to cut age-related benefits, meaning that in the future most people will not be able to rely on governmental support to the same extent they have in the past, so they have to be more financially self-reliant in retirement. Plus, they’re all living longer, and as such the money they accumulate has to go further than it ever has done before.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
