317: See The Whole Picture: The Importance of Having A Financial Plan – with Joel Forman

Meet Joel

Joel is the proud author of Formans Financial Facts, a financial management blueprint. His mission is to educate people so that they can manage their personal finances with confidence for life. Over the past 30 years, Joel has worked in corporate America and a variety of financial roles. He started in traditional financial roles in the financial services and baking industries. About 16 years ago, he successfully moved into the consulting world. 

Why is it so important to have a personal budget?

Well, a personal budget to me, is really the foundation for anyone’s financial management and money management needs. By building a personal budget, you’re going to understand where you’re spending your money, what you’re spending it on, and you’re going to make sure that you’re bringing home enough money on a monthly basis to not only cover those fixed and variable expenses but to also have money left over to what I like to call pay yourself for savings and investment opportunities. If you don’t have a good handle on the budget, and what you have coming in versus coming out, it’s going to be really difficult to do those other two.

Why is it important to have a plan for saving money for the things you want and need?

It’s really quite simple. Unfortunately, we know money makes the world go round, we can’t go in and purchase a new computer with a smile. So what one of the things that I teach in my blueprint is I break it down into percentages for you. 55% is generally for your core bills, your rent, your mortgage, car payments, any loans you have, etc. Then I have 21%, which is a little bit more flexible for wants and needs, for going out to dinner, for entertainment, going to the movies, once the pandemic is behind us. Then the most critical piece of that is the 24%, which is what I call the pay yourself first, which is you break that down to savings and investments. The savings part of that is let’s say you want a new couch, or you’re looking to get a new car and you want to have a down payment on it. By saving for that in advance and putting money aside, let’s say you need a, you know, a $5,000 downpayment? Well, if you all of a sudden just have to come up with $5,000 from somewhere in your financial arsenal, and you didn’t plan for it, it might be more difficult. But by putting this money aside incrementally, it makes the buying experience so much easier when you go to buy that car because that $5,000 while you’ll feel it, it’s less painful because you already have it and you can enjoy the rest of the buying experience.

What are some of the key things to think about when you’re setting these financial goals?

There are a lot of different things that come into play. So I like to look at the whole picture. So you’re going to be wanting to save up for things that you want, whether it’s a down payment on a car, down payment on a house, you’re also going to be thinking about retirement, and yes, no matter how young you are, and especially the younger, the better, because time is not always your friend in life. But when it comes to planning for retirement, time is absolutely your friend, the more time you have for that money to grow, the interest to compound, the market values of whatever you invested in to go up, you want to think about that. You also want to think about your children’s future, even if you don’t have any, and start planning with a 529 plan or something that will get ready that can be used for their future education. So the first thing you would do is make a laundry list of some of the things that I’ve mentioned, and maybe some other things that you want to do. Then the next thing is you sit down either with a financial adviser, or an accountant and lay out the things I want and the things that I need to save for my life and for my family. How do I get there? What’s the plan? What are the steps? What are the vehicles that I’m going to go through, to channel the money to either save and or invest to get to each of those milestones down the road? That’s why you have to plan it out because the house and the car are going to come before the kids and then the kids are going to come and then you’re going to have college and then the retirement is always there, but it’s kind of in the background. You really have to think about it though because like I said, the more time you have the better off you’re going to be.

Can you share with our listeners one of your most successful or favorite networking experiences that you’ve had?

First of all, I’m an avid fan of networking, always have been always will be. I’m a big fan of it’s not what you know, but who you know, and who they know. That is a good segue into how I got onto this podcast with you, Lori. A mutual contact of ours I recently connected with, her name is Grace Chang and I mentioned to her among other things, that one of my goals was to get on a few podcasts like this, and she says, “Oh, I think I can help you, I know two people that have really successful podcast!” So I didn’t realize when I first talked to Grace that was going to come up in conversation, let alone lead to this. You just never know when you’re talking to someone, and you’re sharing your goals and she’s sharing her goals and I’ve introduced her to people where it’s gonna lead. So for me, that’s very recent, hot off the presses and I’d have to say, even though I have a lot of other great successful stories, I think that’s probably the best.

How do you stay in front of and best nurture the relationship that you’ve created in your network in your community?

For me, there’s a couple of things. But for those of you that know who I am, and follow me on LinkedIn, or Facebook or Instagram, one of the things that I instituted at the first week in January, and then the second week of January, I do a financial word of the day, which I’ve been doing since January 2. Then since January 9, I do videos each day and they’re all related to financial tips. Basically, my financial blueprint covers eight financial topics so it’s always within the realm of one of those. I know some people prefer to read things, and some people prefer the videos so that’s why I’m doing the mix of both. It also gives me a chance to hit two promos on the same day without doing the promo because I’m not always telling you to go to my site and buy this or look at what I have. A lot of times, I don’t even mention that. I usually say that or I might have it in the intro written for teeing up the video. But basically, by constantly videoing, I’ve been told that that makes it more personable, people get to know me a little bit more and feel like we’re having a conversation and I’m very comfortable with that. I never thought I’d be doing all these videos, but I’m getting close to my 100th and I just did my 100th word of the day. But the other thing that I do is I’m constantly reaching out to my network and just seeing how they’re doing. If there’s anything new or if I see that they’ve accomplished something, and they promoted it somewhere, I’ll comment in and I’ll try to share that and spread that good fortune for them along the way. So that’s kind of the main ways that I do it, showing up and being consistent.

What advice would you offer to business professionals really looking to grow their network?

I would say you have to be active. You have to be active now on as many social media platforms as you can because you’re going to reach different people on these different platforms. I mean, one of the things that I’d say about LinkedIn is that I’ve always used LinkedIn successfully for consulting opportunities, but now I’ve shifted it as now I’m a financial educator. So I’m using LinkedIn now more this year in 2021 than I have since 2008 when I joined. Another great way is Clubhouse, a new audio platform, and it was originally only for iPhone users at first, now the Android users are on there, so now everybody’s on there, which is fantastic. It’s a great way to go into rooms, usually, they tell you what it’s about and who the guests are going to be and you can get to know people and feel a connection with people so quickly in a short conversation. That would happen organically with emails or messages back and forth, but I’ve met some great people where we’ve taken immediate action on doing things because we just connected. Also, any networking opportunity where you can be in person, or where you can actually talk to someone, the zoom calls, a lot of the virtual things, it’s so much easier to build rapport when you’re having a conversation, and you can cover so much ground so quickly. So I would say put yourself out there. LinkedIn is hugely important, but don’t shy away from Clubhouse and other things where you can get more quick hits, and maybe meet more people in a short period of time.

If you could go back to your 20-year-old self, what would you tell yourself to do more or less of or differently with regards to your professional career?

I haven’t thought about it often, but occasionally I do and one of the things that I would say is when I was young, and I went through my junior year of college, I really wasn’t too happy with it. I wasn’t a great student, I was struggling a little bit and I had this burning desire to have my own business. So I dropped out after my junior year, much to everyone’s dismay and I tried to pursue my own business for four years. I learned so much, but I would say looking back on it after the first two opportunities didn’t work out. After three years, instead of just trying to pursue the dream then, I would have had the wisdom to go on a different plan for now. I ultimately did do that, just a year late. I went back to 49 credits of hell, but in 12 months I got my degree and I have to say it was the best decision I ever made, I was so proud of myself, I did better that year than I did any other. But I would say that over the years since then, there are a few times when I’ve wanted to do something more entrepreneurial, and I would have done it a little bit sooner. But sometimes you get on a different path for a different reason and last year, the pandemic gave me yet another pause in my career, and my youngest son said, “Dad, you’re helping me with my budget, you’re helping me with savings, you’re helping me with investing, you’re helping my siblings, you’re helping my friends, you’re helping my girlfriend negotiate better rates on loans, Dad, you have all this knowledge, you’ve been doing this for free, for all these years, helping everyone and everybody’s still coming to you, but people my age need this, I’d be lost without you. Some of my friends that don’t have access to you are clueless when it comes to money.” So sometimes you just go through life, and you get to a point and something gives you time to pause and you’re always trying to pass on wisdom to your kids. This was one time one of my sons passed on wisdom to me. Ever since I decided to do this blueprint, I’ve been happier than I’ve ever been and the timing of it was great because I actually had the time to delve into it. So I would say be open-minded to when events or pauses happen in your life, and you get a chance to rethink what you’re doing, and how you’re doing it, and how else you can use your skills to help others.

You’ve actually got a giveaway for our listeners today. Do you want to talk about that briefly?

As I mentioned earlier, and as you alluded to earlier about my financial blueprint. I cover 8 of what I consider basic concepts or foundational areas, or principles that you really need to master in order to manage your personal finances with confidence. So I created a pamphlet, and I called it 8 Principles of Financial Freedom by Formans Financial Facts. So each page will give you an example of how a personal budget will be important, that’s one page. Then there’s a basic savings method, which is the second section of my blueprint. From there, you go to basic investment methods, then retirement planning, building your credit and that is really helpful for those people that want to understand more about how their credit score works, and how it helps them, primary loan types, life insurance, and planning for college. So I know there’s a lot of other things, but I did a lot of research and I gave this a lot of thought and I think if you can get a good foundational footing on each of these areas which my blueprint walks you through that and reinforces concepts and philosophies and habits, you’ll really get a good sense of this. This giveaway is a little snapshot of what the broader blueprint will cover.

Do you have any final words of advice for our listeners with regards to growing and supporting your network?

I would say none of us are on an island by ourselves, and all of us have enjoyed different levels of success and continue to enjoy that. But one of the ways that I found has really helped me to grow, is I try to help as many other people as I can along the way. Also, the people that are helping me like I have a social media team and a brand management team, I like to consistently let them know that I appreciate all their efforts because I couldn’t do it by myself. I really do, I am grateful that I’ve had people believe in me and what I’m doing and have gotten to know me and then I introduce people and then they collaborate or create something great and it’s just very rewarding. So I would say always think about how you can serve others and always remember that you’re not doing alone, you don’t have to be and that’s okay. There are a lot of good people out there, a lot of smart people that can give you a lot of great wisdom, and you just never know when that next contact of yours is going to lead to something big for them, or for you.


Connect with Joel


LinkedIn: https://www.linkedin.com/in/joel-forman-fff/ 

Website: https://formansfinancialfacts.com/ 

Instagram: @formansfinancialfacts

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