The True Measures of Success
To help clients achieve happiness, hitting tangible financial goals is only part of the story, Dave Grant says.
In order for the planning process to help clients achieve happiness, hitting tangible financial goals is only part of the story.
Despite good times, I began to realize that my definition of success had been misguided. I had focused on the result (my income) and not on the process (growing a business).
THERE’S ONE CRUCIAL QUESTION I ASK clients before I start working with them. It often doesn’t take them very long to answer, but it can determine if I accept these people as clients or not:
“What would make our relationship successful 12 months from now?”
This question can elicit a range of answers. Some of them are realistic, while others are not.
But this conversation is a great way to determine if our goals and methods are compatible, and it helps us start off a relationship on the right foot.
But then the situation gets more complicated. When I get further into the planning process — after the prospects have become actual clients — and ask them, “What would have to happen to make your life successful?” the answers are usually very tangible.
They might be something like, “Retire at 65, spend more time with my family, travel twice a year …”
A GAP IN THE LIST
In these lists, it is rare that inspirational goals come up.
This is unfortunate because often such ideals could actually provide the foundation for reaching their tangible goals.
It would be reasonable for clients to be listing such intangibles as maintaining good physical health, exploring faith, loving a spouse on a deeper level, and so on.
In short, identifying important intangible goals should be a vital part of the planning process as well.
Why is it so hard to verbalize intangible measures of success? Why do we anchor our happiness on results and not enjoy the process of getting there?
Finding the answers is just as hard for advisors as it is for clients.
This topic hit home recently for me. In 2016, my solo RIA nearly collapsed and I undertook a rebranding.
This project forced me to be more realistic about my goals.
I reverse-engineered an income target that would be ideal for my family. I understood that it might take me a couple of years to achieve success with all the changes I was in the process of making, and I was prepared for sacrifice and discouragement.
And yet that was not the way it worked out at all. Things took a serendipitous turn and I was able to reach my new income, objective within nine months. My gross income actually ended up doubling in that period of time.
But here’s where matters became somewhat troubling. What should have been a celebratory time professionally and personally didn’t feel that way.
I started to feel anxious about whether I could replicate this income, as almost 50%
had come from freelance writing and onetime financial planning fees.
I thought that even though I didn’t need the income, I had to keep my funnel of prospective clients full in order to maintain the firm’s momentum.
Even as my workload became lighter, I struggled with feelings of guilt about not constantly working on my business and I found it difficult to enjoy my downtime.
Just like some of my clients, I began to realize that my definition of success had been misguided.
I had focused on the result (my income) and not on the process (growing a business). Once I reached my income goal, I had come to the end of my journey and now I had no direction. I was unable to savor my good results. Clearly, my focus should have been less binary.
Why wasn’t I happy with my apparent success? Sure, my professional life had been a severe challenge before when I was running a failing company.
But now, having turned things around, shouldn’t contentment be easier to find? My growing roster of clients were happy, my bank balances were growing, and my business stress was fading away.
In choosing to anchor my success on a singular milestone, I had created an inevitable problem.
Once I reached that one goal, I would have to adjust it or create new ones. Would life become a frustrating, never-ending process of chasing increasingly difficult milestones and never being happy? I realized I was not enjoying this process.
I started to reflect on my clients, their financial plans and their overall lives.
How many were just like me — striving to achieve a certain investment balance because that would be the signal of the best time to retire, versus enjoying the process of life and work, right now?
What did they need to change? And, did I have the confidence to ask them and to actually be able to help them explore their answers? If I was having these struggles, surely others were as well.
WHAT DOES SUCCESS LOOK LIKE?
For advisors, as well as for our clients, the focus should be the process and not solely the results.
We should zero in on improving our own lives and the impact we have on others. Reaching those objectives should make our lives, and the lives of those around us, easier and more enjoyable.
If all this results in having more income, excellent. If it means we don’t make as much money, but there is contentment, then we’ve also won.
For our clients, we may need to reframe our conversations. Instead of asking them “What does your successful financial plan look like?” maybe we should ask them “What would you like to improve in your life? What impact would you like to make and for whom? What would you like to experience? What needs to happen in your day so that when you lay your head down to sleep, you do so with a smile?”
Some advisors may do this already. However, for me, asking these questions will be a drastic change.
Discovery will look a lot different and will probably result in a search for a lot of intangible and qualitative information on which to build financial plans.
Even the plans themselves might look different. I expect planning software will be able to tell only half the story of someone’s hopes for their future. It’s hard to quantify someone’s desire to, say, spend time immersed in a new language each year, mentor disabled children and cherish their spouse each day.
If I can refocus my definition of success on continual improvement and the positive impact on people’s lives, tangible milestones will become only part of the story. Earning money and prudently saving will become less of a focus, and the journey of life will become more fulfilling.
We may need to reframe our conversations and search for intangible and qualitative information on which to build financial plans.