I recently had the honor of listening to Salman Khan, founder of Khan Academy, at the Financial Planning Association NorCal conference. The mission of Khan Academy is to provide a free, world-class education for anyone, anywhere. Listening to Khan was quite inspiring. The genesis of Khan Academy was when he tutored a cousin in math a little over 10 years ago. This expanded into tutoring several cousins. Khan created on-line content so that his cousins could learn material at their own pace. He eventually made this material available to the general public on YouTube. Khan ultimately quit his high-paying hedge fund job to focus on the non-profit Khan Academy. Today, there are people throughout the world using Khan Academy to learn.
In his talk, Khan highlighted one of the major flaws of our education system. In our classrooms, large groups of students are instructed and then tested on material. Passing is considered mastering only 70% of the material. Then, even though the test can diagnose what each student does not understand, students are not required to learn this material before moving forward. There are just not enough teachers or resources. Instead, they move on to the next subject.
Khan made the analogy of building a house. Suppose you tell your contractor that he has 3 weeks to finish the foundation. There are delays completing the work, but it mostly gets done. The building inspector comes by and says, “I’ll give you an 80% on the work.” Instead of fixing the issues, you say “great”, and move on to building the first floor. The first floor is only 75% finished before you move on to building the 2nd floor. As you continue the construction, the house eventually collapses due to the many gaps that have been ignored. Khan’s on-line material allows students to fill in the gaps in their education and to take initiative to learn new material. It is truly education reimagined.
Financial planning has a lot of similarities to the situation above. We all have goals, but many of us don’t have a solid plan to reach those goals. A financial plan can help you benchmark where you are today (like a school test) and understand any deficiencies that need to be fixed. Ideally, everything is great, but, in the real world, that is seldom the case. By addressing the deficiencies now, you can ensure you reach your goals, whether that is a secure retirement, sending your children to college, or even saving for a vacation.
At L Squared Wealth Management, we work with you to develop and implement a financial plan with clear actions so you can meet your life goals. Contact us to schedule a complimentary introductory meeting and learn how we can help you build a better financial future.
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