This article article was published in the "New Rochelle Review" in the September 2005 issue.

“Life And Money”  TM –  Financial Planning and Trust - Part 1

By Frank Sisco, CPA, PFS

Last month's column on "Financial Planning and Surprise" may offer guidance on coping with the recent Katrina tragedy.  An excerpt follows: "The surprising event often causes major disruption, sometimes permanent, and usually life-changing.  If we cope well with surprise, then we often make it through, and perhaps even flourish. By fortifying our belief in ourselves, expressing our trust in our relatives and friends, and deepening our faith, we can often overcome adversity brought about by surprise." This month's column deals with the matter of trust.

Webster's dictionary defines trust as an assured reliance on the character, ability, strength, or truth of someone or something.  Without having trust in people, it is very difficult to handle significant financial matters.   You need to trust that your employer will keep its commitment to provide you with an income and various benefits and a safe workplace.  You must trust the community in which your business is located so you may continue to operate profitably.  You need to trust your family members that each will continue to do his or her share for the family's well being, including earning income, controlling expenses, maintaining property, etc.  You should trust the financial institutions and financial advisors and intermediaries who serve you.  And you need to trust the governmental entities, agencies and representatives, that they all will continue in your best interests.  You also need to have a reasonable amount of trust in the future and that it will not be filled with catastrophe, risk and terror.  A tall order to trust in all these.  One problem is that so many people and institutions have breached your trust.  So many across all disciplines and on all levels.   In the corporate world, the high and mightly have been made low and our trust shattered.  Enrons and Worldcoms abound,  In the religious world, abuses by many priests have shattered our trust.  Politically, our reliance on leaders has diminished greatly as the wrongful acts of several taint the good intentions of many.  Globally, countries' leaders spar and show disdain and distrust, spilling over to the citizenry. Terrorists go loose.  Advisors fall from grace, such as big accounting firms, banks and brokerages. With your trust being destroyed, or at least challenged at every turn, of course it affects how you deal with your financial planning matters.

It's no longer enough to try to confine your dealings with people or firms you think you can trust, because it is extremely difficult to sort the good from the bad.  Making it even more complicated is that many individuals and firms are so tainted and so caught up in conflicting interests and greed as a way of living that they don't even realize they don't deserve your trust, and sometimes you don't realize it either.  The devils are not wearing horns or tails.  Often they wear pleasant smiles, cute outfits, sharp suits and the buildings have stately columns and expensive furnishings. 

The dilemma is how do you handle your important financial dealings if it is so tough to trust.  Next month's column describes ways to build, share, evaluate, monitor and expand trust. Email the author with ways you find helpful and he will incorporate them into the column.

Once trust is on solid footing, you will have a greater chance of dealing with surprise, whatever is your own Katrina.

About the author

Frank Sisco is a CPA and Personal Financial Specialist, and author of several articles about personal finance and issues of life and money.   His firm, Financial Management Corporation, is located in Harrison, NY.  Frank makes his home with his wife and daughter in New Rochelle, NY.  He can be reached at 914.381.3737 or by email at ideasmoney@aol.com, or visit his website at www.LifeAndMoney.com.

Submitted 8/7/05, 4:15pm