For far too long, the operative view of financial planning has focused on providing immediate “solutions” to financial problems. In many instances, investors don’t know the real problem they are seeking to solve. Lack of clarity, confusion and erroneous assumptions all come into play. Discovering the actual, sometimes hidden, problem is the more important (and often more difficult), pursuit.
Emotion Driven Product “Solutions”
The majority of media advertising by financial services firms, of course, focuses on solving some particular problem. Maybe it is concern about providing for your family (life insurance); or perhaps “needing” higher investment returns (best funds/managers from last year); or even desiring less risk and “guarantees” (annuities). Some of these may indeed have application to specific individual circumstances but mostly they are emotion driven “problems” searching for an emotion-driven product “solution”.