352 | DIY Financial Planning: Create Your Own Financial Plan
ChooseFI | Financial Independence Podcast
Is There Additional Information That I Cang From These Statements?
Cody: Most of us think of these things s like you have it like a vehicle and passengers, right? So like your rothe aray, your four o one k yo, your four or three b, if you're lucky enough, all these things are vehicles. And it's really important to understand that especially in the tax world, there's really tax efficient passengers for each vehicle. One thing that you could do bread and your spread sheet moving forward is maybe you can make a pie to show what is your asset tax location?"
You already know how to save, invest, and track your expenses — but when did you last map your entire financial ecosystem? Most DIY investors in the FI community can name their portfolio allocation, but ask them about beneficiary designations, tax-efficient asset location, or whether their spending actually reflects their values, and the answers get fuzzy fast. Cody Garrett, CFP and founder of Measure Twice Money, helps FI-minded people fill those gaps without the traditional advisor fee structure. He walks through the critical documents, conversations, and strategies that often slip through the cracks — even for financially savvy people.
Key Topics Discussed
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Understanding Financial Advisors [00:02:30]
- Common misconceptions about traditional financial advisors in the FI community.
- Finding an advisor who understands financial independence.
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The DIY Investor Approach [00:21:00]
- Proactive management of personal finance without solely relying on advisors.
- Gathering critical financial documents for effective planning.
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Aligning Finances with Values [00:27:30]
- Budgeting is about enhancing what truly matters and cutting down on less meaningful expenses.
- Discussing and defining shared financial values with partners.
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Advice-Only Financial Planning [00:55:00]
- Explanation of the advice-only model, which provides financial guidance without managing investments.
- This model aligns with the philosophy of the FI community, focusing on education over management.
Action Items
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Create a Data Gathering Checklist [00:22:14]
- Compiling all financial documents provides a holistic view of your financial landscape.
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Evaluate Your Expenses Against Your Values [00:40:11]
- Periodically assess where your money goes in relation to what you value most.
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Engage in Open Conversations About Finances [00:15:05]
- Discuss financial habits and goals with your partner to build a shared understanding.
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Review and Update Beneficiary Designations [00:49:40]
- Ensure beneficiary designations reflect your current wishes and prevent issues in the event of your passing.
Notable Quotes
- "The product that I provide as a financial planner is actually clarity and confidence." — Cody Garrett [00:14:17]
- "If you don't tell your money what to do, it tells you what to do." [00:24:26]
- "Keep your focus on aligning your money with your values." [00:07:13]
- "Budgeting is about reducing expenses on things that don't provide value." [00:40:11]
- "Beneficiary designations supersede the will." [00:46:19]
Chapter Markers
- Introduction to Financial Ecosystem [00:00:00]
- Understanding Financial Advisors [00:02:30]
- Importance of Communication in Finance [00:14:00]
- The DIY Investor Approach [00:21:00]
- Data Gathering Checklist [00:22:30]
- Aligning Finances with Values [00:27:30]
- Advice-Only Financial Planning [00:55:00]
- Conclusion and Action Steps [01:07:00]
Key Questions Answered
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What is a DIY investor? [00:01:00]
- A DIY investor takes charge of their own financial planning rather than relying solely on advisors. They proactively seek out knowledge and resources to manage their investments and financial strategies.
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How can I align my finances with my values? [00:40:11]
- Start by evaluating your spending to identify what brings you joy and aligns with your values, then adjust your budget accordingly to favor those areas.
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What documents should I gather for financial planning? [00:22:14]
- A comprehensive checklist includes investment statements, income statements, expense reports, and estate documents to provide a holistic view of your financial standing.
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What is advice-only financial planning? [00:53:20]
- Advice-only financial planning is a model where the planner provides personalized financial guidance without the expectation or obligation to manage investments.
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How often should I review my beneficiary designations? [00:46:05]
- You should review your beneficiary designations annually or after significant life events, like marriage or the birth of a child, to ensure they reflect your current wishes.
Key Terms
-
DIY Investor [00:00:30]
- An individual who manages their own investment choices and financial planning instead of relying solely on professional advisors.
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AUM (Assets Under Management) [00:09:02]
- A fee structure under which financial advisors charge a percentage based on the assets they manage for clients.
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Advice-Only Financial Planning [00:53:04]
- A service model where advisors do not manage investments but instead provide personalized financial education and strategies.
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Beneficiary Designations [00:46:15]
- Legal designations indicating who will receive certain assets upon one's death, superseding wills in many cases.
Related Resources
- Measure Twice Money Website [01:03:10]
▶ Listen Next: Ep. 353 — Travel Rewards: How Families Can Travel for Free | Essential Listening
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