The 5 Great Goals of Life.
So following on from my 2 bobs worth last week where I tried to provide a distinction between Financial Planning and Life Coaching, this week I want to reflect on my experiences and explain how I work with my clients by focussing on less. Yes, that’s right. I have taken a road whereby I try to be inch wide and mile deep in regards to how I work with Financial Planning clients.
Don’t get me wrong, I believe that even in Financial Planning conversations, there are a number of times where we will discuss a range of topics and none of these include finances or money. Things like:
Are solar panels a worthwhile purchase?
Is a trip to Bali going to be better than a trip to a cottage in France?
Is Private Health cover a worthwhile expense?
Now, as you can see, these aren’t really ground-breaking financial decisions, but they are important and generally need some time to be discussed and reviewed. I believe that the real financial decisions that need a Financial Planners absolute and required energy are based around a small number of not lifestyle goals, but financial goals.
See what I did there? I tried to get you to understand that as Financial Planners, our focus should be on Financial Goals.
So, which financial goals should we address? When I first started as a Financial Planner in 1996, I went from being a bank johnny to a Financial Planner over a weekend. Not ideal, but that was the go back then. I was fortunate to have a number of colleagues and managers who were able to provide me with unbelievable value in these early stages. My regional manager gave me a tape (don’t tell me I have to explain it, just Google it) from a U.S. based financial planner by the name of Nick Murray. His 63 minute tape gave me a great insight into how I should relate and talk to prospective clients. Now as I had only had weeks of experience, and he had a lifetime as he was on the end of his working career, I thought that I would rather lean on his experiences than my own. In essence, Nick Murray has provided much of the framework on which I have built my business. I tell you this because I do not believe that their has been a more trusted professional who has been able to offer to so many Financial Planners requiring guidance in an unsteady world.
Nick Murray got me and many others to ignore all the other white noise around markets, returns, government inquiries ( 2004 FSR, 2009 GFC and 2018 RC - we all love an abbreviation.) By focussing on the 5 great goals of life, it made sure that prospective clients were going to have their financial needs addressed and it allowed the financial planner to focus rather than be distracted by the white noise that always exists in our world.
So lets take a look at the 5 great goals of Life.
The endowment of a long, comfortable, and totally worry-free retirement, with no compromise in lifestyle, and no real concern about ever running out of money.
The need / desire to intervene meaningfully in the financial lives of one’s children, during one’s lifetime and / or in the form of legacies.
The ability to fund, in whole or large part, the education of one’s grandchildren.
The capability to provide quality care to one;s parents in their later years.
The ability to make a meaningful legacy to a much loved school, church, charity or other institution.
If we only worried about these financial goals, there shouldn’t be too much else to worry about.
Now most of my clients do a couple of these but there are not many who desire to do all of these. I would suggest that 90% of clients focus on retirement planning which is Goal #1. It is a huge financial obligation that requires years of accumulation or the possible transfer of assets from a relative. A lot of energy is required to just focus on this goal alone and to show significant value. So this may seem to be a unique concept in Financial Planning but it has been around for a long time. I believe in today’s environment, we have lost much of the focus on the client, and instead are focussed on products, sales and compliance. If we simply focus on these goals, I believe that all of the discussions around the recent Royal Commission would be null and void. The reliance on compliance, while important would be of less value once clients goals are attained.
If you go and check my recent conversation from LinkedIn, I would suggest that Amanda Pond in explaining how she works with clients, is simply meeting the 5th Great Goal of Life for the client’s she has highlighted. I understand she runs her business different to mine, but she is still helping clients to meet their financial goals.
I am sure there will be other Financial Planners who may disagree with this, but I think if we are going to call ourselves Financial Planners, then maybe we should do some Financial Planning. Bring it back to it’s simplest form and allow the trust to build and create great outcomes for all of the clients that desperately need advice.
Have a great week.
