Credit to Stephen Browne, Voyant
At the Power of Financial Planning conference in the UK last year, Mitch Anthony said, “Money always moves when life is in transition”. This quote really hit home as a central theme of the life changing impact that you can have as a financial planner, and how you are so powerfully positioned in comparison to other professionals who are employed by your clients.
All our lives go through a series of “transitions”
While of course we can trace life events (or instead call them transitions) right back to birth, for the sake of financial planning we can start with transitioning from being a student to working. Transitions are those significant life events that cause a relatively significant change in your life. Each of these changes will have a fundamental impact on your client’s financial situation and include the likes of,
- A new job: Usually this will result in an income increase (hopefully!) and probably a change in benefits.
- Marriage: A very significant financial change where your client and their better half marry their fortunes together. Also now their financial goals and needs substantially change.
- Moving House: A new home usually results in new debt and changed regular expenditure.
- Children: Apart from the obvious immediate costs, your client’s thoughts will soon turn to increased living costs and future education costs etc.
- Retirement: A significant financial event as the income tap turns off and it’s time to live off savings.
- Death: This could be your client’s death or the death of their spouse or parent. Each of these events will have a significant financial impact.
- Other events: And then there lots of other possible events – buying a holiday home, a significant gift for children, the world tour, winning the lotto or maybe a divorce! Whatever it might be, there will be a significant financial impact.
The point to remember is that every time there’s an event, money moves. Think about it. The question is, will you be the one assisting its transition?
Transitions deepen relationships and create opportunities
The good news for planners using cashflow planning software such as Voyant is that you are the key professional relationship for your clients before, at and after each of these transitions. That is because you are the person managing the client’s timeline, preparing for each of these life events and then helping them at the time of transition. No other professional enjoys this trusted position. Your client’s solicitor is consulted when the event is looming and they need legal advice. The same applies to the client’s accountant – their expertise is sought as the event draws near.
However using cashflow planning, the financial planner is the one that is helping to plan for these transitions. You are the one helping your clients to envision their future life, what they want and how they want their life to plan out. You are capturing all of these goals, desires and events in their timeline. You then help them draw up a financial battle plan to empower them to life the life they want. So, when they actually come to that major life event, their financial situation is an enabler rather than a problem. You are the person that is helping them develop a clear financial strategy for their life, giving them clarity and confidence to live a life free from financial anxiety.
Isn’t it funny that while products will be needed as a result of many of these events, these are simply vehicles to drive the plan. The value that you have provided is helping your client to live their life, to move their money wisely in preparation for and during each of the transitions throughout their lives. Is it the product that your clients will be thankful for or the realisation of the life they always wanted to live? I think you know the answer to that one… The added benefit is that you will also be plotting future business for yourself as your client plans for each of their life transitions. As the financial life planner, it’ll be you who will be there when the money moves.