Holistic Financial Planning
Holistic financial planning is just a fancy way of describing a style of planning that looks at your whole situation, not just one area, so that you can come up with strategies that make sense across the board.
And the more developed or complex your situation, the more this matters.
Tunnel vision can be really costly.
In fact, I see this a lot with mortgages. Many people make paying down their mortgage the primary focus of their financial plan because they don’t like owing. And that’s fair, I don’t like it either.
But I also don’t like overpaying tax either. And when I put all my energy and effort into paying off a debt, where my interest rate might be around 2-5% and don’t pay any attention to the 30 or 40% I might be hemorrhaging in taxes each year, then I might end up harming my net worth a lot more than I’m helping it.
And that's the key point here. If you want to grow solid and faster, then you want to pay attention to the whole picture, not just a part of it.
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