Kitces and Carl: Helping Clients To Stop Maximizing Their Wealth And Set Goals To Enjoy It Instead
Beyond offering technical expertise across the eight primary knowledge domains of financial planning, one of the most valuable services that financial advisors bring to the table is helping clients align how they use their resources with the things that are most important to them. Accordingly, advisors create an overlap between a client’s values and use of capital by helping clients identify, set, and achieve goals. Because, as the great American ‘philosopher’, Yogi Berra, once observed, “If you don’t know where you are going, you’ll end up someplace else.” However, for some, the practice of setting and achieving goals can easily become an end in and of itself, which makes it difficult for the client to get off the proverbial goal treadmill and focused on the things that they said were actually most important (i.e., what those goals were intended to achieve). Which raises the question: How can financial advisors help clients who are stuck in the cycle of setting and achieving goals channel their attention and energy towards the things they said were really most important to them?
In our 66th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss the various circumstances that might make it difficult for some clients to get off the goal treadmill, how advisors can help those clients who are perpetually unsatisfied and trying to reach towards the “next thing”, and how advisors can help clients who are nearing retirement find fulfillment outside of their career.
As a starting point, it’s important to acknowledge that sometimes it’s necessary to reevaluate and reset goals because clients may want something more or different than they thought they did at an earlier point or may achieve a goal and realize that wasn’t what they really wanted in the first place. But for clients who are stuck, the root cause of their issue may be that the goal they’ve been working towards all along may not have been the right goal in the first place (and as a result, no matter how hard they work, will never truly reach a point they’re comfortable with). Or, in other cases, it may be that the client has become addicted to the grind and can’t stop, which often turns out to be harmful to both the client and the people that matter most to them.
Such clients may benefit from (re)visiting a life-planning process (such as those offered by George Kinder or Money Quotient), or from an actual intervention, but for other clients, the problem may simply be that they do not know what to do with themselves once they’ve achieved their goals! Especially for those who are nearing (or at) retirement, and need to find satisfaction in something outside of a career that they might have spent the majority of their lives working in. For those clients, advisors can open the conversation by simply asking if they’ve given any consideration to how they’re going to focus their energy once they’ve reached financial independence, so that they’re retiring to something rather than away from something. From there, advisors can help clients brainstorm about the things that they might want to contribute to or do outside of work, and then task them to go try different things out and report back at their next meeting.
Ultimately, the key point is that there can be several reasons that people get stuck on the goal treadmill, and while perpetual improvement is an admirable endeavor, at some point, setting, achieving, and resetting goals may prove to be a blocking point that prevents a client from aligning the use of their capital with the things that are most important to them. And by identifying those root causes, advisors can help clients get unstuck and move back towards creating the sort of value overlap they were hired to create in the first place. Because, at the end of the day, the endgame isn’t about helping clients not have any more goals after getting to the point they initially wanted to arrive at… it’s helping them set new goals that keep them moving forward, in a way that’s truly most meaningful to them!
MICHAEL KITCES BIO
Michael Kitces is Head of Planning Strategy at Buckingham Wealth Partners, a turnkey wealth management services provider supporting thousands of independent financial advisors.
In addition, he is a co-founder of the XY Planning Network, AdvicePay, fpPathfinder, and New Planner Recruiting, the former Practitioner Editor of the Journal of Financial Planning, the host of the Financial Advisor Success podcast, and the publisher of the popular financial planning industry blog Nerd’s Eye View through his website Kitces.com, dedicated to advancing knowledge in financial planning. In 2010, Michael was recognized with one of the FPA’s “Heart of Financial Planning” awards for his dedication and work in advancing the profession.
CARL RICHARDS BIO
Carl Richards is a Certified Financial Planner™ and creator of the Sketch Guy column, appearing weekly in the New York Times since 2010.
Carl has also been featured on Marketplace Money, Oprah.com, and Forbes.com. In addition, Carl has become a frequent keynote speaker at financial planning conferences and visual learning events around the world.
Through his simple sketches, Carl makes complex financial concepts easy to understand. His sketches also serve as the foundation for his two books, The One-Page Financial Plan: A Simple Way to Be Smart About Your Money and The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money (Portfolio/Penguin).
This podcast first appeared on the Nerd’s Eye View at Kitces.com at https://www.kitces.com/blog/goals-maximizer-overachieve-reset-money-quotient-kinder-life-planning/ and has been reprinted here with permission.