How do you know when your financial planning is a success?

In a recent online session held by the Initiative for Financial Wellbeing (IFW), Helena Wardle posed the question of whether the language we use about clients may be presenting money in an overly negative light.

To quote her: “Money is a means of exchange“. We should be helping clients to exchange money for joy and wellbeing. Instead, review meetings tend to focus on the money itself; investment performance in particular.

According to research by Ogilvy, 66% of people want to continue the slower pace of life that they enjoyed during the pandemic. That means 2/3 of your clients. How many of them have you discussed this with? How many of them have asked you to amend the cash flow forecast to see what their options might be? How many times have you raised this possibility with them?

This issue is compounded by the fact that what a client asks to see their financial advisor about is very often not what they actually want help with. A client who says that they need a pension review may actually be depressed at work, bullied by their boss, and desperate to change to a lower paid job that will be far more rewarding.

How might we define success for a financial advisor? Is it an investment portfolio beating inflation? Slightly lower charges on their pensions? I would suggest that, in the eyes of the client, these factors are secondary.

For the client, a successful relationship with their financial advisor would be when they feel their finances are in safe hands; when they are so confident in their plans for the future that they don’t need to think about their money between meetings.

And yet the language we use with clients frames the conversation to be entirely about money. Even asking the question “What does money mean to you” leads to a discussion about money, and not about the clients’ life.

For me, the biggest takeaway from the debate was to be more aware of the language that we use about money, and the tendency to frame it in a negative way.

Still not convinced? As Helena pointed out, if you google ‘quotes about money’, number one is this: “Too many people spend money they earned to buy things they don’t want to impress people that they don’t like.”

Maybe it’s time we focused on the positive aspects of what money can do, rather than the absence of it.

One of the great aspects of the IFW is that it provides a forum for debate on topics that you don’t find anywhere else.

The format of the forthcoming annual conference is that there will be two such debates after every speaker.

Chris Budd is chair of the Initiative for Financial Wellbeing

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