I was talking with someone recently about my financial planning profession and what we do for our clients.

After some discussion about how we help clients create a plan to reach their goals, the person asked me if we can identify people who will be successful in comparison to those who will not. That is a great question with a multi-faceted answer; however, there are predictors that we learn through years of working with clients.

The top two predictors of financial success in my experience are: The concept of delayed gratification and establishing a written plan and sticking to it. These two predictors work hand in hand.

It is important to first identify what “success” means. Success, to me, in the world of financial planning means achieving the life goals that you set for yourself. Success also includes doing what you can with the financial resources you have now combined with the what you can earn in your lifetime. Defining success by a comparison to any other person’s wealth or status is a fool’s game that often leads to unhappiness.

Delayed gratification essentially means resisting the temptation for immediate reward in exchange for a larger and more fulfilling reward later. If I step back and look at the hundreds of clients I have been able to serve during my career that encompass those starting out to those with as much as $60 million in investment assets, those who stand out to me as more successful were able to control their desires for today while focusing on what was more important in the future.

This could be as simple as saving more now for a better retirement later or saving in advance to pay cash for something rather than taking a loan or adding to credit card debt. A great example from a wealthier client was his desire to buy an expensive boat. He could have gone out and paid credit for the perfect new boat, but he watched the ads and waited through an entire boating season. He found a great deal at a substantial discount and paid cash.

The economy today is driven by social norms and advertising that encourage us to seek immediate comfort and pleasure. This impacts everything from health to jobs to relationships. It is important to find the right balance between today and tomorrow, which is why we talk so often about establishing goals in your life.

Some people might desire to travel while they are young in exchange for working when they are older, while others could choose to save more when younger to retire from work earlier. Goals are unique to each person, and the choices you make on a daily basis are neither right nor wrong unless they bring you closer to your goals or pull you farther away.

Establishing a comprehensive financial plan covering all areas of your financial life and sticking to it ranks as my second predictor of financial success. I recall numerous studies that indicate people with a financial plan are more confident in their financial life and achieve more financial success over time.

My experience with clients helps confirm this. I also find that clients who are able to delay gratification will stick to a plan more diligently because they established what is important to them and they are able to ignore the immediate, but short lived, gratification that comes with impulse decisions.

It is painful as a financial planner to establish a plan with specific savings and spending goals only to have a client make a short-term spending decision that goes contrary to the plan and that is detrimental to the established goals. Life throws us curve balls, and in my experience financial plans are meant to accommodate those curve balls.

Impulsive financial decisions on the other hand are self-induced that might have significant financial ramifications. As a financial planner, I strive not to make judgments about how a person lives his or her life or spends money, but instead offer feedback on whether a person’s decisions are leading them toward success with their goals.

The objective is to determine what makes a person/couple happy and help them pursue it while steering them away from what will jeopardize it.

Timothy Breitfelder is a financial adviser and managing partner with Sigma Three Planning Group, a private wealth advisory practice of Ameriprise Financial Services Inc. in Dubuque.

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