Doctors often take a holistic approach to health and medical treatment. Academics use a holistic approach to their research.
So, shouldn’t there be holistic financial planning, too?
There is – and it can provide a wealth of advantages to you and your clients. For instance, by making time to create deep relationships through both serious planning coupled with a detailed understanding of the client, you’ll be better positioned to handle the wave of emotions that invariably accompany ebbs and flows in the market.
If you’re unfamiliar with the concept, holistic investing is a simple idea. It unites the client’s financial investments with other aspects of their life. It takes into account the client’s personal information as well as their portfolio.
As a financial advisor, you need to make sure you’re shifting away from the traditional business method and are applying this big picture approach. Our industry is already making the change, and you don’t want to risk becoming a dinosaur. Additionally, while a holistic approach to investing can benefit you by creating a smoother relationship with the people who are entrusting you with their wealth, it can also give the client a clearer understanding of their own goals and investment strategies, which in turn can produce greater peace of mind for them.
But it goes beyond that.
Our value as financial advisors involves much more than investment management. It will always be a significant part of the services we offer. Until recently, it was all we provided our clients. But now, it’s part of what we bring to the table.
Because clients are changing, too. As Gen Xers and Millennials have a different set of expectations than Baby Boomers and the Greatest Generation. These younger generations want an advisor who goes beyond presenting the best financial plans available; they want someone who takes the time to get to know them and their family.
They want to be asked about major life events, such as marriages and divorces, job promotions and firings, and the birth and loss of loved ones. They are turning to you to help them navigate the tricky financial waters to achieve goals like paying for their children’s college, buying a bigger house, starting their own business, or retiring.
In short, they want to go beyond “This is what I want to accomplish with my wealth” and go to “And here’s why I want to do it.”
For that to happen, you must get the ball rolling. Start the same way you would get to know anyone: by asking questions. Ask about their children and the kind of future they envision. The more time you spend digging into the financial planning process with them, the more you are helping solidify your long-term value with the client.
The markets are going through a highly volatile period. By establishing a bond of trust, you will be able to help them look beyond the immediate moment and stay focused on what really matters, not just today’s return on their investment.
Once you have that firm relationship in place, you will likely have an easier time helping the client manage the wide range of emotions that come with market ups and downs.
Plus, the planning part ensures the investment strategy aligns appropriately with their long-term goals, hopes, and dreams.
Given the financial turbulence we’re enduring right now, it’s understandable that you would want to talk with your clients about anything other than the markets. I get that! And that’s the beauty of holistic planning—with this approach, there are plenty of other things for you to discuss. Such as their kids, jobs, and even something as mundane as household repairs.
Your ongoing personal relationship, combined with sound financial advice, helps you develop wealth plans that will improve the investor’s wellbeing and bottom line. Remember, the emphasis is on delivering them peace of mind and fulfillment.
When you get right down to it, the question isn’t should you adopt the holistic financial planning approach, but rather, why shouldn’t you?