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Part 5: Is Suze Orman Right: Can you do your own financial planning?

Suze Orman says: Do Your Own Financial Planning! “I think it’s imperative for you to do as much of the work as possible, rather than turning control over to someone else: your finances.” Ms. Orman and I agree on this. Is this really true, and what does this mean?

I think the biggest thing Suze Orman can be accredited with is her encouraging and empowering people, especially women, to take responsibility for their personal finances. Her advice and message isn’t particularly sophisticated; she doesn’t get into a lot of the minute financial details. But her positive motivation with basic financial wisdom helps people to become more engaged and make better decisions.

Suze definitely believes people can and must take control of their overall personal financial situation in the broad sense, and that includes knowing and making good decisions with its various parts, from insurance to 401(k), and from budgeting to debt elimination. We, she, and other financial personalities recommend this. However, in the professional context, can people be their own financial planners? My answer is, of course. Everyone is intelligent enough and capable of learning and doing their own planning.

What is a professional financial plan? I defined financial planning in a prior article, but to summarize, a financial plan is a written personal road map to financial goals. It covers virtually all areas of one’s finances. It is both an organized snapshot of where one is, and a plan to where one wants to be. A financial plan will cover virtually all areas, such as retirement, college education planning, investing, and more than 50 other areas.

Until recently, people could only obtain comprehensive financial plans from professionals. They either pay a fee or agree to be presented with a financial product that would pay the planner a commission. But now, companies like eFinPLAN can offer online financial planning, for a very low-cost, and with no product bias.

DIY: The advantages of do-it-yourself financial planning

  • Engages you in the process, which gives you a great sense of responsibility and the confidence of being ‘in-the-know’.
  • Forces you to organize your financial records and affairs.
  • Helps you become financially smart because you will learn much during the planning process as you see how various parts of the plan and your results are connected.
  • Gives you a better understanding of how to use trusted advisers so you can relate to them at a higher level.
  • Helps remove the intimidation factor of working with financial professionals and helps you detect when they may not be working in your best interests.

Implementation of a financial plan is the most important part of financial planning. This begins after you have input all of your financial information into the financial planning software application, and it produces a complete and personal planning report for you. You then use the report to help guide you in implementing the its steps, such as in the areas of insurance or retirement planning. You have a whole host of ways to go about acquiring products for your plan, including many options from online financial, tax and legal firms. You may choose to use local advisers or online ones, and they may try to provide second opinions. This can be helpful; so be open to this. However, by doing your own online financial plan, and acquiring all of the learning, education and engagement, you are much better equipped to process and judge what is presented to you.

In summary: Suze Orman is right, you can and should take control of your finances, and put yourself into the driver’s seat of your financial planning. You are smart, intelligent, and capable, and with the number of excellent web-based firms today, you can do a lot of it yourself, saving you time and money in the process.

This is the 5th and last article in a series about financial planning: