The Six Step Planning Process

The Six Step Planning Process

In this post, I’m going to start covering the Six Step Planning Process, which you can (and should) use for your financial planning. Here’s a chart that I like to use to illustrate the entire process:

The Six Step Planning Process

Now, let’s go over the first three of these steps in more detail.

The Six Step Planning Process

Step 1

Gather Information
There is a need to take the time to collect basic personal data. Name, address, age, family, criminal history, charges, and sentence information. Then clarify your present situation by collecting and assessing all relevant financial data such as lists of assets and liabilities, tax returns, records of securities transactions, insurance policies, wills, pension plans, etc. Some of these items you have locked up in your head, in your locker, in boxes or folders. Most of you do not have much, so let’s put in a little creative energy here and use what you have and your best guess. You should be able to get the criminal files from the institution. It may take a bit of work, but it can and should be done.

Step 2

Identify Financial Goals

This is by far the most critical step in the process: defining and developing realistic goals and objectives. It is also the most vital part of the process. (You need to forget that song “I want to be a Billionaire, so Freakin bad.”) Build a list of realistic personal goals, realistic financial goals, goals specifically devoted to your family and friends, and lastly, but most importantly, your spiritual goals. Do your best to start thinking about your financial and personal values and attitudes. These may include providing for children’s education, supporting elderly parents, or relieving immediate financial pressures. Keep a note pad by your rack. If you wake up in the middle of the night with an idea, write it down.

Step 3

Identify Financial Problems

You need to come to grips with where you are financially right now. In custody, this can be quite uncomfortable, but it still needs to be done.

You will need all the facts to establish your current status. Then we are going to view them from two different points of view. We are going to take a quick snapshot of your finances: “ the freeze-frame view.” Then we will take a “motion picture view.” The combination of both should give you a really good picture of just where you are financially right now. Issues will start to surface, and most of the time, it won’t make you feel very good. The reason is that these financial problems appear as a barrier to achieving financial success. Your cash flow may be inadequate, or the current investments may not be winning the battle with the changing economic times. You may not have any money or assets at all. Plus, we have a bunch of common felon-based problem areas that must be identified before solutions can be found— issues like restitution, child support, back taxes, and personal and family obligations. The good news is this book is going to help you deal with them, but even better is that you are identifying them. We want to avoid surprises.

Look for the last three steps in the next blog post!

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