I received a call last year from a woman who’d sounded desperate.  “I was just offered an early-retirement package from my company,” she’d said, the words rushed from anxiety, “and I’ve got two weeks to make a decision.  Can you help me?”  I had groaned inwardly, imagining the late nights ahead struggling to collect the necessary data, performing the analysis, and clarifying the results in a way that would enable her both to understand and to take action.  But of course I did what I could to help.

It’s not uncommon for us to put off planning for something until we see the need for it.  That’s human nature.  But it’s also risky.  Have you made a list and stashed away emergency supplies in case of an earthquake?  What about a tornado?  The latter may sound remote but one actually touched down in my backyard in 1998.  The cost and stress of recovering from an unplanned problem is usually much higher than if we had planned for it.  And we typically learn this lesson after it’s too late.  When was the first time you started backing up your computer hard drive: before or after your first disk crash?

A recent survey by Nationwide Financial found that 26 percent of potential investors do not have a financial plan.  Even worse: 38% of those that do not have one have no intention of getting one.  “We live in an era when Americans are more responsible for their own financial security than ever before,” said Michael Spangler, president of Nationwide Funds. “However, for various reasons far too many haven’t taken the time to draft a detailed financial plan to help them achieve their goals over the short, medium and long terms.  An effective plan is much more than opening a savings account or investing in your employer’s 401(k), it’s a map to ensure that you get to your financial destination.”

Without a financial plan, we are left unprepared for life’s big transitions, such as a job loss, marriage, divorce, birth of children, buying a house, inheriting money, death of a loved one, and other countless events that can have such a huge impact on the quality of our lives.  And the emotional upheaval these life transitions cause us makes it extremely difficult to make good financial decisions when we’re in the middle of one.  The time to plan is before the event occurs so that we’ll be much better prepared to effectively manage the transition and its financial impact and not get sidetracked by all the pain and stress.

Probably one of life’s biggest transitions is retirement.  US News reported that in 2009 between 60% and 80% of baby boomers had expected to work past age 65 as a way to overcome the devastation of the Great Recession.  Unfortunately, many failed to consider the employment situation or their health as factors.   As a result, according to a follow-up survey by MetLife, over half of the first wave of baby boomers to hit retirement age had stopped working before they’d planned.  Many still hope for part-time jobs or developing new careers, but have been struggling to find them.

The missing element in their plans was the inclusion of alternative scenarios.  As humans, when we make guesses about the future, we almost inevitably predict more of the same.  Unfortunately that’s not how life works.  When we include different scenarios in our plans, we reduce our vulnerability (both emotionally and financially) to unexpected changes.  And the younger you are, the more likely you are to face a curve ball or two at some point in your future.

To summarize, the time to make a financial plan for your future is now, not when you’re in the middle of dealing with a major life transition such as divorce or job loss.  And a robust plan should include several scenarios to ensure you’re prepared for at least some of the major issues life could throw at you.