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Six Financial Resolutions Enunciated in 6R

CFP Korean Professional Daehong Kwonby Daehong Kwon, CFP 

While I personally have many plans and resolutions for the year of 2012, I have culled the followings related to Financial Planning (FP) practice, arranged by their head letter “R”:

Remember the Recession

After the subprime mortgage crises of 2008, we saw some signs of economic recovery in some parts of the world. Then, the fear of a recession swept around the world once again.

We are now being so hard-pressed to foresee what will happen in the next second, which even experts differ greatly in their opinions. Looking back at the history of global economy, we find booms and slumps have taken turns repeatedly. We don’t have to be overly pessimistic, but we need to be aware that a crisis of an unpredictable proportion can arrive anytime. We should always be on guard for a “Black Swan” of the 2008 crisis, and ask our clients to keep a watchful eye, as well.

Risk Management and Rebalancing

Should the global economy in 2012 still turn out to be not so good, we should pay more attention to the risk management and rebalancing of assets. While de-leveraging and European crises are posing a global risk, a post-Kim Jung Il regime change in North Korea and the upcoming general and presidential elections in South Korea are posing political uncertainties in the Korean peninsula in the new year. We might have to develop such a risk management plan as to increase risk-off assets and secure a sufficient liquidity by helping clients reduce high-interest debts. A “Plan B” might be needed in preparation for an unforeseen contingency, so as to prevent a frustration and to spend a healthy year.

Roadmaps for Our Lives

We don’t have to shrink too much from a darker economic condition in 2012. It is rather advisable that we sit back and look over the past times to come up with a macroscopic life plan for the future. In the Korean FP community, life-focused financial planning practices that go beyond just financial planning have recently been spreading. The FP’s and their clients are discussing not just financial issues but non-financial ones as well, that are related to the entirety of their lives.

In fact, an empathy shared with clients over non-financial issues tends to help build a trust relationship with them more than just discussing financial ones. This writer is going to draw life roadmaps with my family and with my clients, to develop them into a book or a literary work. For instance, I am drawing out, with a CFP professional who is also my colleague, a life roadmap for a client with a rather enigmatic title, “A Long Wait, Turkey in Three Thousand Days, and a New Start.”

Realistic Plan of Action

I am going to motivate my clients to implement their plans in 2012. For the sake of a better implementation, I am developing varied programs which my family, colleagues, and clients can participate in and carry out with me. Related to these are some marketing brands I am preparing to launch, which are designed to help enhance client’s satisfaction as well as to upgrade my personal brand value as an FP. One of them is a coaching brand named “6R.” This is a coaching program and consulting rule that I use for client counseling, education, and writing. The R can stand for many things, including retirement, risk management, and rich. The number 6 refers to a process or a concept. In 2012, I am planning to utilize a variety of ideas and develop them further. Some of them have, in fact, already been put to action.

Right Now

Even a very good plan becomes useless if put off or not put to action. There is an old Korean saying, “A resolution lasts only three days.” It refers to a tendency that a resolution, big or small, has only a three-day life, which reflects the difficulty in its implementation. There is another old saying, “Do not put off till tomorrow what should be done today.” Nothing can be done if it is put off by indolence or by a fear of failure.

The reason I am writing this right now is to materialize the plan to employ the 6R concept in a wide spectrum right away. In 2012, I am going to put everything that has remained a plan into action immediately, regardless of whether it can lead to a success or a failure.

Restart in 2012

Some may have had a successful 2011, and some others a tough one. The year of 2012 can be a more painful one. If, however, we always make sure to stay on guard and do risk management for a crisis that can occur anytime, we can turn the crisis into an opportunity.

In addition, if we comfort each other in a tough time, look back over the past, and seek a hope for life, we can find consolation. The year of 2012 can become another great, energetic year if buttressed with a great plan and a will to implement it. Putting behind all the pains in 2011, let’s set out again to a great start in this new year!

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