A CFP's Honest Opinion: Most people simply aren't willing to commit to their financial future

WRITTEN BY: Gideon Drucker, CFP® AIF® ECA

I was thinking about the maxim “the customer is always right” the other day as I was winding down the end of a scheduled “Right Fit” Call.

On this call, the prospective client started off by saying that they:

Work in finance & so they know what they need to do.
Don’t need help managing their own investments.

I then asked, as respectfully as I could, why THEY booked the call. This was their meeting. (For context: I don’t seek out ANYONE to schedule a call with me. I don’t ask to buy anyone a cup of coffee to talk "business." I don’t take people out for lunch & networking makes me cringe. People that sincerely want and need great financial planning advice will reach out to me and tell me what they are looking for. Most of the time there will be a fit. Sometimes there won’t and we can direct them elsewhere.)

Anyway, this couple mentioned that they:

Want to lower their tax bill through “creative” strategies.
Have spoken to other financial planners & a few “insurance people” but never moved forward.

I told them, point blank, that these calls are meant for EACH of us to decide if we think we’re the right fit to work together and that I need to make sure that my team is comfortable onboarding them into our financial planning process just like they are gaging if we can provide the value they need.

This might be different than what they’ve experienced in the past where the person on our side of the table (Zoom screen) was just trying to “convince” them of what they need. In fact, I could tell that this is what they’ve experienced in the past and they were waiting for us to “sell them” or convince them why they needed help.

Our process couldn’t possibly work like that if we are going to do work together effectively.

It’s important that you can spot the difference between a successful fiduciary that is looking to find a fit/provide value and a salesperson that is just looking for you to say “yes.”

Our financial planning process is an in-depth 2–3-month process where we go through every aspect of your financial, tax, investment, employee benefits, cash management, retirement, and estate planning set up and then provide advice & analysis. For that type of advice-driven engagement to work, there has to be a baseline amount of respect, trust, and an understanding of value.

We will be meeting 6-8 times; we will be providing objective advice and most of the value lies in the education & follow through. If you can’t recognize on your own that you might not have it all figured out, I don’t think we are going to have a healthy working relationship. Some humility is necessary for our value to stick.

If a potential client can't see why they would invest $3k-$6k for this level of advice, analysis, and hand holding...than truthfully, I don't think they've yet grasped the value that having a financial plan will provide for them and their family.

They might SAY they want to make improvements, get organized, and feel more secure but they are not willing to invest the time and resources to get there. (And by the way, this is not just about working with our firm....this is about someone KNOWING they need help and not willing to make the investment with any fiduciary advisor to actually get it done.)

We are not selling a financial product. Someone that’s just selling an insurance product or an investment portfolio doesn’t really need to “like” their potential client or think there’s a “fit’. They just need to tell the client what they need to hear to get them to sign on the dotted line. It’s a transaction. If they ultimately agree on the product sale...the salesperson will stomach whatever indignity is necessary to get there.

In my case, the client is not “always right.” If I don’t think we’re going to get on well or ever be on the same page, I will not begin a relationship with a new client. Why would I want to spend the next 2-3 months with such a person?

Anyway, back to this prospective client.

While right off the bat I did not see this couple as a potential fit, they were introduced to us by a client/friend, and I wanted to at least help them understand a few things.

Maybe these points can help you as well:

Investment management is NOT financial planning. The overwhelming majority of the value that we provide, the analysis that we perform, and the scenarios that we run through have absolutely nothing to do with “fund” selection. You could have the most perfectly designed (for you) set of investment portfolios in the world and still be in immediate need of professional financial planning guidance. Thinking because you “know” investments and therefore don’t need a financial planner is like saying that you don’t need a personal trainer/nutritionist because you eat an apple/banana every morning....I mean that’s a good start, but it tells you NOTHING about your overall health/fitness.

Working in finance does not mean that you have the time, patience, or desire to oversee your financial organization and coordination. I look at tax returns every day. I will never file my own tax returns because it is an utter waste of my time and energy and I’d rather pay a professional for their time rather than waste my own.

If you are a high-income earning couple with W2 salaries, there is only so much that you can do to lower your current year tax bill. Anyone that says otherwise is lying to you. The good news however is that the goal shouldn’t be to lower your single year tax bill anyway. The goal should be is to lower your lifetime tax bill which requires paying more or less in taxes in any given year depending on your marginal tax bracket.

Our catchphrase is “brutal honesty”. I believe this needs to exist at every step of the process. It means that I am absolutely ok telling a client if their housing goal is unrealistic, their spending habits will lead to future issues, or if they are underfunding their kids’ college.

It also means that I will tell a prospective client if I think they’re misguided or if we’re not comfortable beginning a working relationship.

In the long run, I know this will benefit everyone involved.

Schedule your 15 minute "Right Fit" call here to discuss...