The Next Stage for Life Planning

On the Kinder Institute’s Web site (kinderinstitute.com) you use “EVOKE” to describe what this extended program is imparting to your students. E stands for exploration. V is visioning–what does the dream look like? In the middle of the process, what if the client gets anxious? All we do is empathize and listen, while a therapist will do a lot more. We keep coming back to the inspiring dream, rather than go back into the past. We hold the torch. O is the most important: it stands for obstacles. When many people attempt to do life planning, they get what the vision is, but then the client backs off–he has to pay the mortgage or get kids through college. We find which obstacles are most profound and deal with what is left. We ask, “What do you see as obstacles to your dream?” What [clients] thought would take two years [to accomplish] may take 10 to 15, and they’re getting discouraged. They’re thinking 10 or 15. I’m thinking zero to two, [but] I’ll propose four. Then the budget becomes much more important–it’s perhaps the most important part of financial life planning. We use all the tricks in our bag to help them get there as fast as possible. The K is knowledge–the plan itself–and E is execution. The one distinguishing difference with a traditional financial plan is that a financial life plan has two aspects. There is the traditional–a will, investments, funding the 401(k). But there is also spending more time with the kids, writing a novel, figuring out how to live with greater integrity on the job. Whenever a client comes in for a quarterly annual meeting, the focus is on the torch. Sometimes the torch actually changes, but we’re on top of that. This shift is a danger to traditional financial planners. They don’t go deeply enough to know what will occur. Traditional financial planning is like a doctor trying to cure the disease without listening to the symptoms.

Do you have any other projects in the works? We’re registering life planners on our Web site. By spring, we’ll have 50. That means they have done the 2-day program, the 5-day program, and the 4-month mentorship. We’ll also offer continuing education units so people can continue to be life planners. In 2004, I gave a two-day workshop to the Garrett Planning Network. One of our missions for 2005 is to reach out to the public media–Oprah, Business Week, The Boston Globe–to let them know that life planning exists. The other broad movements [in the industry]–the first was the CFP movement in the mid-1970s. Then the fee-only movement, with NAPFA as the model. Now it’s life planning. Each movement evolved from a crisis in investment products. It is important to link all three.

You’ve done some training for wirehouses, too? I gave a workshop for SmithBarney’s elite advisor group. They’re almost all fee-based people. But this is a delicate area. I do believe strongly in the fee-only movement, but it’s very difficult to do life planning on a commission basis. I do know some planners who do that with grace and integrity, but it’s difficult. The client has to get through your image as a salesperson. When we take our work to the giant corporations that want to do life planning, we’re working with fee-based or fee-only people. What we are finding is that life planning is something that is likely to lead their organizations more toward a fee-only approach.

You were one of the founders of the Nazrudins. I don’t think that Dick Wagner and I realized how huge this was going to be when we started the Nazrudin project 10 years ago. In the early days, I was sitting at their knees. The first five years were extraordinary. It was the think tank of life planning. We all felt more like pastoral counselors than financial advisors. A group of us would hang out and solve problems. It was like the ’60s–helping out with a community that was passionate about their clients. Now we have the Kinder Institute, and [early life planning advocates like] Elissa Buie, Guy Cumbie, Elizabeth Jetton, Dick Wagner, Ed Jacobsen, Troy Jones–they’re now all major FPA figures, in the leadership, or emerging into the leadership of the FPA.

George, you talk about America being in a spiritual crisis. We are earning three times as much income as our grandparents, and all the studies show that we are not happier. Is that a spiritual crisis or what? Is that an economic crisis? We have had 50 years of stagnation and you call this the best economy in the world? We are not producing any more happiness. That’s an economic crisis. If we were living more proactive lives, doing what makes our hearts sing, you’d see the economic benefits occurring throughout the world. This means working with the smallest economic units: the person and the family. There are four major things that people dedicate their lives to in life planning: family, spirit, creativity, and community. What we are talking about is healing relationships within the family and unleashing creativity. The family unit can then be more valuable to the community.

How about your own practice? I sold my practice five years ago to Abacus Wealth Partners. I feel that I was liberated when I sold my asset management service. I am still affiliated with Abacus. I work on an hourly basis, and I refer people to them. I get to see my old clients and take on new clients from time to time, but my focus is on how people are going to live a life plan. Asset management is much more of a commodity business than we’ve acknowledged. I am a big believer in indexing. The life planning part is the real value. Life planning is the heart and soul of the business.

Most advisors today get their assets from clients who are retiring. It’s terribly important that life planning be delivered as early as possible. People in their 20s should be made aware that life planning exists. So should middle-income and lower-income audiences. We’ve given the two-day training at inner-city churches. This is terribly important. It’s ridiculous that people don’t know about financial planning. The basics of economic literacy ought to be taught in high school, and life planning needs to be introduced in college, or when people are in their early 20s.

If you were writing Seven Stages today, would you change anything? If I were to redo it, I’d be much more clear and direct in attempting to inspire the reader to create his own life plan and to find an advisor who is comprehensively trained as a life planner.

Any sequel to Seven Stages? There’s another book, perhaps. I’m not quite ready to address that. Since I’ve been a kid, I’ve always wanted to do illustrated books. I’ve been influenced by William Blake. I’ve wanted to combine writing and illustration on a single page. I hope to have something in a few years.

Editorial Director William Glasgall can be reached at [email protected].