by According to a 2013 Financial Literacy Survey, 2 out 5 adults would give themselves a C-D or F on their knowledge of personal finance.
Clearly, people need the help of Financial Advisors.
Why aren’t people asking for financial planning help? They don’t know how financial planning can help them because they don’t know what financial planning is.
Why aren’t most advisors promoting financial planning? Same reason…
The CFP board defines financial planning as-
“A process of determining whether and how an individual can meet life goals through the proper management of financial resources.”
With only 8% of the population actually achieving their goals, the word goal is enough to scare off the crowd right out of the gate.
I propose a new definition.
“A conversation designed to help individuals organize and understand their financial life, necessary to make sound money decisions.”
Financial Planing starts with the conversation. Asking the right questions, at the right time. It’s what fuels the advisor/client relationship.
While financial planning software has no problems spitting out dozens of pages filled with numbers, tables, projections and charts, I think it’s a mistake leading with the printed plan before the planning conversation.
Just like the printed musical score is not music, the printed financial plan is not financial planning.
More to follow…