FINANCIAL LIFE PLANNING: POP PSYCHOLOGY OR REVOLUTIONARY ...
FIRST PUBLISHED: FINANCIAL PLANNER – AUGUST 2005
FINANCIAL LIFE PLANNING: POP PSYCHOLOGY OR
REVOLUTIONARY PLANNING TOOL
BY ALAN DICK
Signing up to participate in the recent George Kinder related. The three phases are then split into a total of
‘Seven Stages of Money Maturity’ workshop, I was both seven sub-stages ranging from ‘Innocence’ to ‘Aloha’.
excited and somewhat sceptical. Having read the book
some time ago, I was left with the distinct feeling that Innocence’ refers to the fact that most people have an
Georges approach to planning was too much like incomplete understanding of the factors affecting their
counselling and not something that I, as a financial financial lives, making decisions based on feelings and
planner, was equipped for. I had visions of American TV beliefs that often have some degree of truth but are
evangelists and daytime chat show presenters breaking generally incomplete. Formed from simple old wives
guests into tears before building them back up in a tales that we hear throughout our developing years, the
frenzy of emotion using a mixture of pop psychology and real problem with these types of beliefs is that they
manipulative performance skills. However, I was contain just enough truth to be dangerous.
pleasantly surprised that George was nothing like this at
all. In fact, he was keen to point out several times Much of the workshop focused on techniques to
during the two day workshop that “we are in the understand and empathise with clients in order to really
planning business, nor the therapy business” and our understand the beliefs that are trapping them and
job is to understand how a client is affected by money stopping them from taking the necessary action to
issues not why they ended up that way. achieve their dreams. The process focuses more on
aspirations than simple goals. Life planners should be
What is Life Planning? able to encourage their clients to dream the impossible
in order to get them enthused about starting the
Is life planning a gimmick or fad, or is it something journey to their financial freedom by “lighting a torch”.
much deeper and longer lasting? I personally can’t However, there is little point lighting torches if we can’t
easily relate to some of the emotional aspects of the also coach clients through the difficulties they will face
course, but the core of the system is simply a very well- while keeping the torch lit.
presented values-based planning process. The point of
life planning is to move away from transactional-based The highest stage in money maturity is the Hawaiian
product sales towards a proper understanding of what expression ‘Aloha’ that has many different meanings In
our clients are trying to achieve. George’s terms it means the passing of a blessing
regard- less of economic differences. It can relate to
Lack of money and excessive wealth can both cause gaining an understanding of one’s position in the
severe money problems. Lottery winners, recipients of community. Having reached ‘Aloha’ many people want
a large inheritance, and entrepreneurs often feel to set up their own charity, do some form of voluntary
unprepared, lonely, frightened and resentful of their work, or share their knowledge with the next
money. In many cases clients are trapped by their generation. They derive pleasure from the things their
money and as a result often make poor financial money allows them to do for others (whether family or
decisions. community) rather than the acquisition of possessions.
George teaches that there are seven stages to clients’ The stages in between attempt to explain many of the
progress through their financial lives. These can be split challenges we all face on our financial Journey. George
into three distinct phases which he calls ‘Childhood’, teaches us to understand the ‘Structure of Suffering’
‘Adulthood’ and ‘Maturity’. It is important to understand that traps us and stops us achieving our ‘Aloha’
that these are financial life stages and are not age whatever it may be.
something that may take off in the UK from next year.
Where does it go from here?
During the workshop, participants split off into groups
of two or three people on several occasions to practice Whether you want to completely change your business
the techniques. What absolutely amazed a cynical West into a Life Planning Practice or merely implement some
of Scotland male like me was how easily people opened of the techniques into your existing business model to
up and revealed very deep and sensitive information gain a deeper understanding or your clients, there is
about themselves. These were sensible, highly qualified certainly a lot of great stuff in the course. Personally, I
‘normal’ people and not the kind of individuals who think I will implement bits of the process now and
appear on the Oprah Winfrey Show desperately seeking perhaps add more as time goes on. I still feel scared
attention to fill the void in their lives. I deduced from this and rather intimidated by the incredible responsibility
that the techniques are in fact extremely powerful tools. that comes with encouraging clients to completely open
up to their feelings about money. However, the shift to
The process relies on a series of open-ended questions, understanding client beliefs and values is so
each of which drill down deeper to uncover clients’ true fundamental it can be successfully applied to almost any
values rather than mere goals. It is very difficult for a business model
client to get genuinely excited about their financial
planning if they only have cold goals like “I want to retire Financial Life Planning is clearly much more than pop
on £30,000pa in today’s terms at age 60”. psychology, but is more an evolution than a revolution in
values based financial planning.
The traditional financial planning skills are still required
to work out how we can help our clients achieve their
dreams, but the focus of the process is subtly shifted
from mechanics to emotions in order to truly
understand our clients.
Who goes to a course like this?
As the workshop was held in Surrey, I expected it to be
full of English financial planners. However, I was
surprised to find several Scots, a nine strong Dutch
contingent, an American and a Kiwi among the 32
participants. I was also surprised to find the group
included a wide range of planners seeking to learn how
to use the ‘Seven Stages’ in their own lives and
businesses; insurance company representatives trying
to understand where financial planning is going next;
representatives from Aquos who want to understand
the needs of their clients; a journalist and at least one
individual with no connection to the financial services
industry who had a real desire to understand their own
relationship with money. All in all a pretty mixed bunch!
What was the response?
The vast majority of participants described the
workshop as “uplifting”, “life changing” and “eye
opening”. However, the best expression came from
someone who said they had decided several major
changes to their life but they felt guilty they had had the
chance to experience this course while their spouse
hadn’t been able to be involved. They said that they
would have liked the opportunity to reach these
decisions together with their spouse. George told us
that in the States it is quite common for people to
attend the courses with their spouses and this is
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