The Elements of a Plan

The Elements of a Plan: As a follow-up to our last video on what Open World’s process is like, Ian goes over the elements of any financial plan. These three things (and a bonus) can actually be applied to most plans and goals in life, but they are especially relevant when working on a financial plan.


What’s up, Internet? My name’s Ian Bloom. Welcome to Nerd Finance. I’m your resident financial life planner and huge nerd. In today’s episode, we are going to be talking about the elements of a financial plan. And I’m going to break this down pretty simply because I think that people over-complicate their finances a lot.

The elements of a financial plan, at their core, come down to three things. One is an understanding of where you are today and where you would like to be in the future. It’s somewhat hard to get an understanding of this, however. A lot of people aren’t aware of what they’re spending, how much they’ve invested, what they’re saving, and those sorts of things. So that’s where the work that I do often comes in is helping people diagnose where exactly they are today, and then focus on what is exciting to them. The future can hold a lot of different things. And you can either have the future that you want or the one that happens to you by accident. So deciding what it is you want and making steps towards that, first step of a financial plan.

The second element of a financial plan is the analysis that a financial planner will do. You see, software has evolved to do some pretty incredible things. With financial planning software, I’m able to project out 30, 40, 50, 60 years of a client’s life based on their current financial decisions and continuing those, and tell them how much money they will not only be earning or saving, but also how that will grow their net worth over time. So it’s important to remember, much like the opportunity cost video we did last year, that every decision will ultimately have an impact on your financial plan. Going to get that latte, despite what the media would have you believe, is actually a relatively small decision. That latte purchase will not change your financial future. However, where the media does have some good points is that the cumulative effect of a lot of these small decisions can have a big impact on that analysis. Because if you were to save $100 more a month over 30, 40, 50 years, that could compound to a heck of a lot of money and savings.

Now, the final element of the financial plan is the recommendations. The recommendations are determined by the financial planner as a result of the work that you did in step one, deciding where you are today and where you would like to be in the future and the analysis. Basically, the financial planner’s job is to tell you what the steps are that the analysis recommends to get you from where you are to where you want to be. It’s kind of that simple.

But here’s the bonus step. The recommendations are useful. They certainly are, but the bonus step that’s most useful is actually implementing them. A lot of financial planners do not implement with their clients, and that’s something that we do differently here at Open World. I spend time implementing with all of my clients. And what I mean by that is, is if it tells you to save $100 more a month, I think it’s the financial planner’s job to help you set up $100 more a month in savings, whether that means finding it in your budget or physically going onto the website with you and helping you select transfer $100 from my checking account to my savings account.

You see, all of these things are very important. But ultimately, making the changes based on all this analysis and recommendations is what’s actually going to change the outcome. Action is more important than knowledge on some level. Knowing and having informed action is the best result, but doing things is ultimately going to be required to change your financial outcomes.

If you did enjoy this video, please like, comment, subscribe, do something to let me know that you were here. And then if you are interested in seeing what a financial plan would look like for you, feel free to head over to my website at and check out the services that we offer there. I am more than interested in working with other nerds who would like to make financial progress.

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