Most financial decisions aren't permanent.
You can change investments, save a little more, spend a little less, or adjust your financial plan as life changes. We make decisions, learn from them, and make changes along the way.
But every so often, you come to a financial decision that feels different.
Selling a business. Retiring. Claiming Social Security. Making a significant gift to your children. Selling a highly appreciated asset.
These decisions can have consequences that last for years, and some can be difficult, expensive, or even impossible to undo.
Those are the decisions worth slowing down for.
Selling the Business You Spent Decades Building
For many business owners, their business isn't just another investment. It's something they spent 20 or 30 years building.
Then one day, someone makes an offer.
Naturally, the first question may be, "Is this a good price?"
But there are usually bigger questions hiding behind it.
What will the sale mean for your taxes? Is the deal structured properly? Will the proceeds provide enough income for the rest of your life? What will you do after the business is no longer part of your daily routine?
The day an attractive offer arrives probably isn't the day you want to start thinking about these questions.
Deciding It's Time to Retire
We often think of retirement as a number.
"Once I have $X, I can retire."
In reality, retirement tends to be much more personal than that.
Leaving work affects where your income comes from, how you pay for healthcare, when you claim Social Security, how you use your retirement accounts and potentially how much you pay in taxes.
But there's also another question that shouldn't be overlooked: What are you retiring to?
Travel? Grandchildren? Golf? Volunteering? Another career?
A financial plan should help answer whether you can retire. A good retirement plan should also help you think through what you'd like retirement to actually look like.
Claiming Social Security
Social Security is a great example of a decision that looks simple until you start asking questions.
"I'm eligible. Why wouldn't I take it?"
For some people, taking it earlier may make sense. For others, waiting could play an important role in their overall retirement plan.
The point isn't that there is one "right" age.
It's that your decision shouldn't be made simply because you reached a certain birthday.
Your health, life expectancy, spouse, other income and retirement goals can all be part of the conversation.
Giving Away Money or Property
This can be one of the most rewarding financial decisions you'll make, and one of the easiest to make emotionally.
You want to help your children buy a house. Help a grandchild with college. Give property to family. Or perhaps you've simply accumulated more than you expect to spend.
Those can all be wonderful reasons to give.
But before making a significant gift, it's worth asking two questions:
What does this gift mean for the person receiving it?
And just as importantly:
What does it mean for my own financial plan?
Good planning allows generosity and financial independence to work together rather than compete with each other.
One Decision Can Affect Another
This might be the most important part.
Major financial decisions rarely happen in isolation.
Retiring may change your tax situation. Selling a business may affect your estate plan. A large Roth conversion may influence other parts of your financial picture. Giving away property today may have very different consequences than leaving that same property to your family later.
Sometimes the decision that looks best by itself doesn't look quite as attractive once you see how it affects everything else.
That's why planning matters.
Plan While You Still Have Options
The best time to think through a major financial decision isn't when you're forced to make it.
It's while you still have choices.
Good financial planning can't guarantee that every decision will turn out perfectly. Life doesn't work that way.
But it can help you understand your options, recognize the tradeoffs and see how one decision may affect another.
Markets will change. Tax laws will change. And your financial plan will change along with your life.
But some decisions can be difficult to undo. Those are the ones worth planning for before the moment arrives.