What Does Wealth Mean to You?

We use the word “wealth” a lot in our profession. We’re even called wealth managers, which is an accurate description of the service we provide for our clients.

But since we are, indeed, managing their wealth, shouldn’t we all share the same definition of that important word? It’s trickier than it sounds because what wealth means to you may not be the same as its meaning to your clients. And, to further complicate things, the concept of wealth varies widely from person to person.

Let’s begin with the basics. Merriam Webster says wealth is the “abundance of valuable material possessions or resources.” And we can all agree on that.

But the individual semantic meaning each person attaches to that “abundance of material possessions” is where definitions begin to diverge. As a wealth manager, it’s vitally important that you understand the thoughts—and feelings—each client associates with that powerful word. Because when you grasp that, you will have a significant head start toward providing them with exceptional customer service.

Several recent episodes of my “Bridging the Gap” podcast focused on this very topic. And my guests offered some interesting insights that may surprise you.

Eris Voisin, CFP, is the director of financial planning at EP Wealth Advisors. “It’s not a dollar amount. Wealth is being able to live the life you want comfortably for as long as you live. So, wealth is fulfilling your goals: Sending your kids to college, paying off your mortgage, retiring to your ideal location, that is what makes someone wealthy.”  

Kevin Mahoney, CFP, Founder and CEO of Illuminit, a Washington, D.C.-based company that offers virtual financial planning for Millennials, sees it a bit differently. Here’s what he said: “For me, the definition of wealth involves the word ‘time.’ I really value being at a point where I have full control over my time based on the way my family and I have made financial decisions and tried to set ourselves up for financial stability.”

He then talked about how his clients define the word.

“For many of them, it’s having less uncertainty about the financial decisions they face. And, once that uncertainty is removed, it’s feeling empowered to make decisions that get them closer to the life that they want. I don’t think wealth is necessarily about the size of their bank account or how much they have invested, it’s about getting to that point where they can clearly see what their options are, and then aligning things and making choices so that whatever is most important to them they are going down that path.”

Let those words sink in for a minute: “I don’t think wealth is necessarily about the size of their bank account or how much they have invested …”

What Kevin is saying is contrary to what intuition would suggest. Many clients don’t measure their prosperity by their bottom line. Rather, they quantify it in feeling secure. Secure that their financial advisor is both knowledgeable and trustworthy, which breeds confidence. That leads to peace of mind and security. And that secure feeling is their definition of wealth.

So, if a client has an expectation that you can guide them into generating so much money that they can eventually buy a private Greek island, it’s worth having a conversation with them about the true meaning of wealth and how it involves far more than dollars and cents. You should let them know that you offer benefits that go far behind helping them grow their portfolios.

As Kevin concluded, “Because of uncertainties associated with things like high student loan debt, higher housing prices, or stating a college fund or adding to retirement savings, it’s not until clients can understand the tradeoffs that they can feel more freedom to pursue the things that they really want in their lives.”

One phrase stands out: “More freedom to pursue.” Because when you get right down to it, that’s what your clients want. They are looking for more freedom to set their unique goals, to chart the right course to pursue them, and for someone to help them stay on course every step of the way.

Our ability to help steer clients towards that freedom is our superpower, and the key to the future of our profession in an increasingly competitive marketplace.