May 28, 2012
3 Questions that make financial planning meaningful – Answer them now!
Sadique Neelgund
Last year at FPA Annual Conference in San Diego we were exposed to Financial Life Planning. We had organized for the Indian Delegation a Life Planning workshop by Lisa Kichenbauer, a Registered Life Planner (RLP) and Financial Planning practitioner. During the course of workshop… she gave us a simple assignment which Life Planners ask their clients to dig out the underlying values, deeper emotions and aspirations of their life.
These 3 questions were developed by George Kinder, Founder of Kinder Institute of Life Planning & Author of Seven Stages of Money Maturity. Preparing a Financial Plan using time value of money and number crunching on a spreadsheet may be superficial in nature. For a client to act and implement the Financial Plan… it has to address the real goals and concerns which these 3 questions might help bring out.
Take out a Pen & Paper
Here I am sharing these questions with you… simple but powerful questions. Take out a pen & paper and answer them in about 15-30 minutes. Trust me… you will not regret spending these 15 minutes on the assignment. When we took this assignment… some of us had tears in our eyes!
If you miss it now…life will move on and you will keep chasing materialistic things without the real purpose.
Don’t read the next question without answers the previous one. Pay special attention to 3rd question… it’s going to be touchy! Download this Word Document if you want to take a print out and answer it.
1. Imagine you are financially secure, that you have enough money to take care of your needs, now and in the future. How would you live your life? Would you change anything? Let yourself go. Don’t hold back on your dreams. Describe a life that is complete and richly yours.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
2. Now imagine that you visit your doctor, who tells you that you have only 5-10 years to live. You won’t ever feel sick, but you will have no notice of the moment of your death. What will you do in the time you have remaining? Will you change your life and how will you do it? (Note that this question does not assume unlimited funds.)
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
3. Finally, imagine that your doctor shocks you with the news that you only have 24 hours to live. Notice what feelings arise as you confront your very real mortality. Ask yourself: What did you miss? Who did you not get to be? What did you not get to do?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
Revisit Your Financial Plan
In the first place do you have your own Financial Plan? If yes…revisit your financial plan keeping this sheet beside you. Revisit goals and aspirations… Yes… one has to strike a balance between dreams and practicality… but we cannot ignore our underlying values and concerns.
If you don’t have a financial plan yet for yourself… make one ASAP!
Try this with Clients
I am still learning what life planning is all about and how it can be practiced. So can’t suggest exactly how to use these questions. But thinking aloud these are some of the ways in which you can incorporate these 3 Questions in your practice.
- How about including these questions in the data gathering questionnaire.
- Send the client these questions before meeting for data gathering. Tell them to answer these in peace and discuss at meeting
- You may want to give a freehand to client to reveal the answers to you or not. Just in case they are not comfortable.
- Keep the first year plan simple… Include these questions in the Review… when the relationship gets deeper.
- Just put it up on your website and prompt visitors to answer them.
Do share you thoughts and ideas on this exercise. In case you have still not answered these questions because you are busy… come back in the evening! Don’t miss…
Authored by,
Hi Sadique,
I am using these 3 questions from couple of months – outcome is amazing. Lot of clients identify new goals, it help them in prioritizing the goals & few goals even don’t require money.
I don’t send all 3 questions at one go – I send first question & when he answers I present the second question. First question is about their dreams, second about their financial life & third about their personal life.
Thanks Hemant for sharing your experience here. Do you ask client’s to share the answers with you or they keep it to themselves?
Hi Sadique,
They share answers with me & we also discuss. Best part is – in lot of cases they realize that they are not giving sufficient time to spouse or parents. Most of them have never asked about dreams/goals of their spouse – I motivate them to do similar exercise with them. 🙂
Yes… in fact… for both Priti and me… when we took this exercise… we realized we are not giving enough time to friends, family and relatives which we want to. I think this is common amongst the current generation.
Do you ask husband and wife… both to take up the exercise at once? Or it’s just the client who is in touch with you?
Thanks Hemant for sharing your experience. It will guide us to use these questions in our practice.
Ankur… maybe you want to include these questions right in the beginning of XLFP data gathering form? But know how to deal with the situations that can arise out of this exercise.
I use a lot of questions before we take our financial coaching clients…one of the question is what are your true wants behind your goals? – As you are speaking to your prospect and your prospect says “I want to have 1 crore ” or “ I want to buy a second home” or “I want to have financial freedom by 45” …You say I’ll help you do that, financial planning helps you in meeting your goals! I have helped a lot of people till now and I think I can help you with what you want. Would you like to go ahead with your planning, it takes X amount to work with me.
Never do this I would say. This is when you step up as a planner and help someone connect with their true wants…something that they really really really want.
I have seen that the more you work on the goals with any prospect the faster he converts as your client…..Just ask him why do you want to have 1 crore and he will start sharing his true wants…..their true wants are always behind the wants they share in the first call or meeting……..
Some of the questions that I ask people:
What do you want to accomplish in your financial life before you die? (Make a list it can be qualitative or quantitative in nature, it can be 100 things that is fine, don’t laugh at yourself, it can be anything just express yourself fully)- connect prospects with their true wants
What according to you is holding you back in your financial life? ( some challenges that are stopping you in living the financial life that you REALLY want)- here your job is to show them that nothing is holding them back- only they can get in their own way no one else
What is the one thing you can do to make your financial life simple? ( it’s not about hiring a financial planner) – this creates a space between you and your prospect……as every investor knows what will simplify things. Make simplification their primary goal as investor….
Make a list of things which you know you should be doing in your personal finance but you have been avoiding doing? (Tell the Truth, I know this list will amaze you)- this to create urgency in their life
What is your money story, in brief not a very long one? ( Example What did you see about money did you see scarcity or abundance , hear about money or wealthy people good things or bad things and ay specific experience you remember about money as a child or in your young age, We all have some money story and it is important to catch certain things that happened years back)- this is an opportunity for you to enter into their life….the more you intrude the faster they connect with you
If any planner wants to learn more I would be more than happy to help someone set-up their practice..
nandish
MR Nandish,
I am planning to set up my own practice. I will need help from you. Please share your email ID and i will get in touch with you.
Thanks in advance,
Vijay
Thanks Nandish for sharing your experiences… Manish did share with me the kind of coaching you do with clients… It looks like its really at a deeper level. Life Planning has been criticized by some financial planners saying it requires a lot of time… and hence not a viable approach as clients may not appreciate the concept and pay a higher fees. Are you facing this problem anytime?
Firstly Life Planning or what we callit as financial coaching does not take more time….infact most of our clients feel sad when I say this will be our last call….I love the process and it is not about more time or less time it is about serving someone in their financial life…..I am not aware about the criticism so cant say about what is viable and not viable…..
During our recent visit to bangalore we (I and manish) had lunch at one of our coaching client’s home, he even offered us to stay at his place……the point I am trying to make is life planning or financial coaching is about creating special relationship and when that is done all the objections disappear, all the concerns go and the focus is on value and on taking actions.
We have coached 100+ people till now and fees have never been an issue, time has never been an issue….According to me when investor experiences YOU fully (the planner) fees is never an issue…..if fees is a concern in planners mind it gets planted in clients mind….most planners plant their fears in their clients mind and so it becomes a hurdle……
Most investors think that fees is the highest level of commitment but it is not true….we say that financial commitment is the smallest commitment they can make….as just giving money wont change their financial future….
Sadique I can just go and on and on….thanks for being such a good friend…all the best for all that you do…when in ahmedabad do take out 10 mins to meet me….
Wonderful thoughts Nandish… Will surely catch up next time in Ahm. Why don’t you write some article on these lines on Network FP? I am sure planners around the country would benefit from these experiences and thought process. Thanks again
Sure sadique….Would love to share what I have learn t in past few years.
I have e-mailed you sadique. I and manish are quite excited to put our sales experiences on paper.
it’s nandish@jagoinvestor.com
Hi Sadique thanks for posting wonderful thoughts…thanks a lot Hemant and Nandish for sharing your experiences….its a wonderful learning…I need to come back and answer these questions for myself first….
Abhinav
Welcome Abhinav. Do share your experience once done. Ask Jaya also to take it up. And then share them with each other if comfortable.
Priti and I had some small surprises for each other!
Amazing stuff Sadique. I did the exercise and am a bit overwhelmed, but I guess that is good. Will use it on clients too. will share experiences soon. thanks for the post.
You are welcome Bhuvana. Clients might get emotional, so should know how to handle situations. So were the answers addressed in your current financial plan?
Hi Sadique, the questions are really eye opener and as Hemant pointed out, it centre’s around Dreams, Financial Life, and Personal Life.
Nandish you are really doing a great job as Financial Coach, and it really rejuvenates and motivates me the idea about Financial Coaching, i would really like to get more ideas on it, will surely get in touch with you on your email id.
You are welcome Harish… hope you have answered these questions for yourself… maybe you want to share the exercise with a few clients and see how they react.
Hi Sadique, these are truly great questions. We too use a “Life Book” concept where we take our clients through the journey of their life and ask questions which act as a catalyst to plan their future goals and objectives. I would like to share it with other Financial Planners who would be interested. They may download it FREE from below link:
http://www.blissxpress.com/lifebook.asp
Hi Priyesh… I have downloaded this. This is a good approach. Are clients willing to fill in a lengthy form like this. What has been your experience?
Would you like to share this Lifebook with Network FP members. Can create a new post with pdf file with sue credits to you. Kindly let me know your thoughts… Thanks