Redefining Wealth: Financial Life Planning That’s All About You

A strong financial plan is the foundation of any good investment relationship—and the cornerstone of that foundation is a goal. Or, more likely, a series of goals which evolve over time as progress is made.

For many people, the question “what are your financial goals?” doesn’t have a simple answer. Some find that traditional financial goals just don’t feel “right” while others feel overwhelmed by the prospect of thinking beyond a vague desire to “retire early.” 

It seems obvious that, as the driver behind their behavior, a person’s financial goals for their future should be clearly defined and at the center of their financial plan. Why then do so many people struggle to reach the goals they’ve articulated—or even to define their goals at all?  

One of the biggest obstacles to a successful financial plan is our ability to follow through with the goals we set—which makes the question of why this is such a challenge for many people a significant one for us as financial planners. The reality is that most people don’t spend a lot of time thinking about their personal financial goals, instead allowing their vision for the future to be informed by what society or their social circle define as conventionally acceptable and worthy financial goals.

But those goals aren’t necessarily the right goals for everyone. If you work hard all your life so you can retire at 55, but then don’t enjoy your time in retirement, is that really a success?

Rethinking Your Goals 

So how do we get out of this mindset? How do we define financial goals that we’re motivated by—and which we’ll actually follow through on?  

Instead of limiting your thinking to your finances, we’ve found a slight shift to asking “what are your life goals?” makes all the difference in answering this question. When we remove the requirement of these goals being ‘financial’ in nature it opens all sorts of possibilities. What most people may not realize is that many of the goals we set for ourselves will have a financial tether, whether they are seen as a ‘financial goal’ or not. By working with someone who understands this, deeper and more personally resonant goals can be built. 

A New Approach to Financial Planning

In traditional financial planning, the process begins by discovering the client’s goals and then building a strategy to meet them. At Truepoint, we’ve adopted a different approach through ‘Life Planning.’ 

Instead of starting at the end and focusing on the goal, we begin by reflecting on the beginning. We’ll start by asking questions like: 

• What was your household like growing up?
• What financial behaviors did you learn from your parents?
• What values did your family or friends impart on you?
• As a kid, what did you imagine your future life would be like?

The answers to these questions provide greater insight into how a client’s perspective on finances was shaped. Someone who grew up in a single-parent household where money was limited has a different financial foundation from someone growing up in a dual income home where money was never a worry.  

By asking these questions, we can focus on the person and all of their complexities; not solely on the assets they possess. To some this may seem like just another form of relationship building for the advisor, but in truth, it’s the client who ultimately gets the most out of these conversations.  

The Power of Life Planning 

By spending time sharing their history, the client can come to recognize why they have certain beliefs or behaviors toward money. They can discover which habits or perspectives were learned from others and which came from their own experiences. They can understand what they prioritize at this moment in their life, and how it may be in conflict with their goals.

Life planning helps the client to differentiate between their own desires for the future and the goals that society or someone else in their life has deemed significant. As individuals, we are more likely to follow through on our own ideas than those we are told to do by others.  

Thus, this thoughtful and conversational approach increases the likelihood that a client will be truly motivated to reach their goal, and the financial plan will be successful.  By encouraging our clients to vocalize their own values, we are helping them to foster stronger connections to the goals that they ultimately articulate.  

At Truepoint, we seek to integrate Life Planning into all our client interactions. This can be through broad discovery conversations where we dive into a new client’s history and upbringing, or more focused topics in order to encourage a greater awareness within our existing client relationships.  

We understand that these conversations can feel very different from the typical financial discussion. To help navigate this change, we utilize specific questionnaires that allow clients to think through these styles of questions in advance of our meetings. This approach can be useful for both the client and advisor, as the client has more time to think about their responses and what they may be comfortable sharing, while the advisor has guidance on where the conversation may go.  

However we may approach it, the goal of Life Planning is to help the client see the entire story of their life and how the financial plan is just the map to help them along the way.