While recording a podcast recently, the interviewer Matt Halloran mentioned how different our approach to financial planning is versus others. We think this is true for reasons that you may not at first consider. Honed by three decades of working with hundreds of successful individuals, we have a very good idea of what is required to make our clients’ lives better.
One immediate distinction is how we engage clients. We are totally honest with clients about where they stand financially and don’t try to sugarcoat shortcomings. If you want a different outcome, the inputs that go into the wealth planning formula necessarily have to change. This requires an adult type acceptance of the connection between action (or inaction), and consequences. We have come to believe that the more a client can become a financial adult, the better the chances of good long-term outcome.
A large part of becoming a financial adult is accepting the fact that the financial world does not re-order itself to suit you. You can’t control the markets but you can harness their energy for your own purposes. Many years ago we worked with a client who exhibited many non-adult tendencies. During one meeting he declared that he “needed” a 10% per year portfolio return and he wanted his Investment Policy Statement to reflect this “need”. We quickly reminded him that the markets are made up of millions of participants and his “need” was not a factor in the long-term outcomes. We eventually parted ways and I occasionally wonder how he has progressed with his portfolio return “need”.
Goals With an Emotional Bond
Another way that our approach is different is the manner by which we help clients establish realistic and rational goals. Aspirations are fine, but goals need to be very personal so that they will create an emotional bond that fuels change. If goals are not connected to you personally, necessary changes won’t occur. Our experience tells us that a good goal should be both achievable and slightly uncomfortable. Once you have very personal, very actionable goals, financial adulthood will soon follow.
Personal financial planning is essentially personal economics. Economics is mostly concerned with making choices and of course, accepting what comes from these choices. As Scripture says, there comes a time when we need to “put aside childish ways.” Everyone that comes here wants good outcomes. Becoming a financial adult helps that cause. Ready for a real conversation?