What is Financial Life Planning?

Trailhead Planners LLC |

A few weeks ago, I had a meeting with a couple who had just become new clients and we were engaged in the first step of the financial life planning process. Prior to this meeting, I ask my clients to do some prep work which involves meditating on and answering a set of questions that help us get clear on what the client values as well as what they aspire to or what fulfillment looks like.

When I first handout the questions, I can tell that many individuals look at them with skepticism.

I came in for a financial plan, but instead of talking about money you have me answer questions regarding purpose and meaning? What does this have to do with money?

I could tell the husband felt this way, and I was curious to see how things would unfold during the meeting. However, before getting into that, I should talk a little more about financial life planning and why this distinct process is, in our opinion, the most effective way to do financial planning.

What Makes Wealth Meaningful

Over the past couple of years, Courtney and I (Morgan) have each received training in the process of financial life planning. Though we attended different institutes, Courtney is a member of Money Quotient and I am a Registered Life Planner via the Kinder Institute of Life Planning, the basis is the same: your financial decisions should be connected to your core values and life aspirations.

More, we believe that wealth is meaningful only in as much as it supports you and others in living meaningful lives. Put differently, financial life planning is as much about creating moments of fulfillment as it is about nuts and bolts financial planning: budgeting and cash flow planning, long-term investing, tax planning, risk management, etc.

The Kinder process of inquiry begins with three core questions. To paraphrase:

  1. If all your material needs and wants were fulfilled, how would you live your life? Would you change anything? Don’t hold back on your dreams.
  2. If you went to the doctor and she said you have only 10 years to live, but you will have your mental and physical health to the end, how would you spend your remaining time?
  3. This time your doctor shocks you with the news that this is your final day. As you acknowledge the feelings that arise, reflect on your life. What did you miss? Who did you not get to be? What did you not get to do?

Every so often, we are reminded of the importance of asking ourselves questions such as this. Whether a feeling of contentment arises, adventure, or even disappointment, what matters is that we are engaging as active participants in our lives and looking to the future with a sense of purpose.

More, effective personal finance, at its core, is about creating healthy money habits that can be sustained over a period of years and decades. Pay off your credit card every month. Contribute regularly to your retirement accounts. Maintain a healthy 'rainy day fund.' Stick to your spending plan.

A typical financial plan details these nuts and bolts answers. However, it does not speak to how we might get the motivation to implement the advice on a daily level over the long-term.  As a result, many clients leave their financial planners with pages of great information that will never see the light of day.  In my experience, the best advice in the world is meaningless if we do not connect with it on a personal level. 

What Creates Positive Change?

What does create change?


When you develop and maintain a broader sense of purpose in your life, it helps clarify your vision.  Regarding your personal finances, your purpose, or ‘why’, helps us figure out how to use your financial resources to further that along purpose. Focusing on bad habits and what we want to change does not get us anywhere. Instead, the object of our desire must shine so bright that all else falls away.

The New York Times' David Brooks wrote about a similar idea in a 2014 column entitled The Art of FocusHe writes,

"If you want to win the war for attention, don’t try to say “no” to the trivial distractions on the information smorgasbord; try to say “yes” to the subject that arouses a terrifying longing, and let the terrifying longing crowd out everything else."

Applying this to the ‘art’ of creating positive habits, instead of focusing on everything that needs to change, focus instead on the positive vision of change itself (i.e. purpose) and let the harmful habits, financial or otherwise, simply fall away.

Ultimately, the cornerstone of Financial Life Planning is connecting our unique values, desires, and aspirations to our everyday financial decisions. By focusing our attention on fulfillment, personal values, and purpose the Financial Life Planning process makes the obstacles that get in the way of financial success, whatever 'success' means to the individual or family, seem so much more trivial. Challenging as they may be, the obstacles that confront us ultimately appear surmountable.

"I Get it Now" 

Returning to my recent meeting, when I work with a couple I ask each individual to read their responses to the questions without interruption or comment from the other spouse. In this engagement, the wife went first. We talked of her hopes, her values, and we discussed her aspirations. 

She painted a picture of minimalistic living, accented by a vision of a wood stove, big windows, and deep water.

By the end, we had a sense of what her financial plan was for, and what the purpose was of all this work.

After she wrapped up, I turned to her husband and asked if he was ready. He looked at her and then looked at me and said,

"I get it now. I get why you have us answer these questions."

Some people walk into our office and want to know how we are going to make them money. They ask if we know of any investment strategies that will make them rich, or how we plan to beat the market. Though I believe we at Trailhead Planners have the expertise and experience to devise clear and effective financial strategies, including risk-conscious investment management, this point is secondary.

Ultimately, your financial plan only matters as much as it supports your broader purpose. More, an individual will only stick to a long-term investment strategy, through good times and the inevitable bad, if instead of focusing on every tick up or down in the market they are instead focused on a vision of fulfillment. Similar things could be said for sticking to a budget or spending plan. 

In the end, this is the reason we are financial life planners. The money isn't our client. The person is our client.  And we devise a strategy where her financial resources support her in living her best life.

If you have not already, and you are interested in engaging in a life planning consult with us at Trailhead Planners, please let us know and we would be happy to discuss what the process looks like. Additionally, if you know of someone who might benefit from and/or be interested in financial life planning we would welcome the connection.

A 30-minute initial consult is always free.

Schedule with Courtney

Schedule with Morgan