When people first learn what I do for a living, they often assume I crunch numbers all day. And, of course, numbers are essential to financial planning.
But the skill I use the most as a financial planner can’t be found in a spreadsheet. It can only be found sitting face-to-face in a client meeting, asking questions and listening—intently—to people’s answers.
It’s empathy. And I’ve learned in my 20 years in the industry that if you don’t know your clients and their dreams, you can’t craft a successful plan for them. Sure, my job involves many technical issues—like when to start taking social security or how to maximize retirement savings vehicles—but the actual decisions are usually determined by a client’s lifestyle and personality more than their income level or tax bracket.
An essential part of empathy is focusing on what clients need, rather than what an “advisor” wants, out of an interaction. I’ve never been interested in selling clients on products, and that’s why the prospect of joining Truepoint last year was so exciting.
To put it plainly, Truepoint is simply not driven by a sales culture. As a fee-only firm, products and commissions are not part of Truepoint’s model. Consequently, there’s never any attempt to pressure a client into a particular solution that is not in their best interest. From my first meeting, it was clear that at Truepoint everyone sees themselves as stewards of their clients’ capital and that they take that responsibility very seriously, day in an day out.
I’ve been thrilled to work on a team with such a deep bench of knowledgeable professionals. Before every client meeting at Truepoint, we coordinate a “prep huddle” in which we examine the client’s current financial situation and opportunities, bringing together every group in the organization—from investments, estate planning and tax. Each person in the prep huddle is encouraged to speak from their perspective—all in the service of providing the best solutions for our clients.
This level of input, expertise, and coordination enables Truepoint to create truly comprehensive plans, unique to each client. In the past year, I’ve seen how such collaboration can make a real impact on clients’ decisions. Here are a few examples:
A new client came to us after years with an advisor who had sold them a dizzying array of investment products. Despite receiving lots of financial advice, the couple felt like they didn’t really have a plan—just accounts with different structures, tax characteristics and unnecessary fees. They had recently been instructed to purchase a complicated annuity but were feeling uneasy. After running a cost-benefits analysis, we realized the client would be better served by adding to their existing investment accounts. Although some of their investments would be subject to taxes, those taxes would be far less than the fees on the recommended annuity.
An empty-nester couple was starting to think about retirement but was skeptical of financial advisors. Until working with Truepoint, they had self-managed their investments; yet, they were frustrated with the lack of coordination and potential missed opportunities on the tax planning side. We started with a long-term financial projection to examine lifestyle spending and savings opportunities and saw the opportunity to overhaul the company benefit plan. Shortly thereafter, we helped update their estate plans, coordinated their tax strategy and supplemented their life and disability insurance plans.
A young couple with a growing business wanted to plan for their children’s education costs and obtain advice on how to manage money more effectively and gain tax savings. First, our investment team provided a comprehensive review of their current portfolio and collaborated with our in-house tax team to illustrate the pre- and post-tax impacts of different investment decisions. To address their specific tax concerns, we coordinated with their business tax accountant—something many wealth management firms are simply not built to do. Finally, because they owned their own business, estate planning was also an important consideration, and Truepoint worked closely with the family’s attorney to create new plans.
Our teams collaborate on solutions like this every day at Truepoint—and not just when we are creating a comprehensive financial plan, but every time a client faces an important decision. After all, saving for your grandchildren’s college education isn’t just about opening an account. It involves legal, tax and investing issues that will be different for every client.
My favorite moment professionally is when we can tell clients, with full confidence, that they can retire. Their response—the relief and the excitement—is palpable. And that doesn’t come from numbers on a spreadsheet; it’s the product of years of collaboration and trust. In their first meetings with Truepoint, new clients may express a mixture of fear, anxiety and even skepticism. We all find fulfillment in helping clients reach a place of calm, security and peace. That’s the empathy behind financial planning. And that’s how we serve clients at Truepoint.