Financial Planning, Millennials

Start With The Right Intent

“Every project must begin with the right intent.”

Ryan Holiday

I’m in the process of finishing Ryan Holiday’s newest book, Perennial Sellers; it’s a book about creating timeless pieces of work–perennial sellers. I pre-ordered the book because I’m a fan of Holiday’s work, enjoy his writing style and wanted to support him. I also thought I’d pick up a few marketing tips to help with my efforts to grow my firm’s footprint, but I didn’t expect much to translate to the world of financial planning and investment management. I was wrong!

Early in the book, Holiday explains, “Every project must begin with the right intent. It might also need luck and timing and a thousand other thing, but the right intent is nonnegotiable–an thankfully, intent is very much in your control.” I immediately highlighted the quote and wrote in the margin “financial plan”; this could be rewritten substituting financial plan for project, and it would not lose its truth. Like the perennial sellers Holiday describes in the book, a financial plan also requires a little luck, some good timing and thousands of other variables to succeed, but without the right intent, a financial plan is doomed to fail.

I’m not discrediting the importance of the recommendations that are created; the savings plan, investment strategies, and other recommendations play important roles, but your intent and the intent of your financial advisor are the driving forces behind your financial plan. Your financial advisor’s intent is the easier of the two to discuss, so let’s start there…

Financial advisors create financial plans for one of two reasons:

  1.  to help clients reach their goals, or
  2. to sell product

In the first scenario, the intent of the financial advisor is to act as an actual advisor, a partner and fiduciary to help their clients make sound financial decisions on the journey toward their goals–this is the right intention. In the second scenario, the intent of the financial advisor is to sell a product that may or may not help their clients reach their goals–this is the wrong intention. When a financial plan is merely a sales tool, the likelihood of the client reaching their goals is low. However, when a financial plan is an actual plan–a roadmap for the decisions to be made, the likelihood of the client reaching their goals increases. This is because without the right intent, the plan is not designed to stand the test of time, but with the right intent, the financial plan is designed for the long term and with ongoing consultation will stand the test of time (and life)–to steal the term from Holiday, creating a perennial financial plan.

There are plenty of ways to find a financial advisor with the right intent. Referrals are always a great option–ask someone you trust about their financial advisor. Online resources like the CFP® Board website, or NAPFA can help you identify financial advisors to interview as well. When interviewing financial advisors learn to trust your instincts–after the first meeting you should have a feeling, one way or another, if the intent of the advisor is to help you. A final tip to aid in your search is to look for financial advisors held to the fiduciary standard–if you’re not sure what that means, just Google it and you’ll find plenty of articles about why working with a fiduciary is important.

Once you have found an advisor with the right intent, it’s time to look internally to find yours; too many people just go through the motions when it comes to their financial planning. Just meeting with a financial advisor, sharing a few goals and leaving with a document you won’t look at again is not enough. You need to be able to understand your goals beyond the age you want to retire, how much you’ll need to fund college, or any other quantitative quality your goals have. You need to understand the “why” behind it all–the “why”is your intent. Allow me to elaborate…

Knowing the age you want to retire is good, but knowing why that age is important to you is better. Everyone reasons for why they choose their goals, and there are always emotional reasons behind them. Maybe you want to retire at a young age because you witnessed a family member die early in retirement and never get to enjoy the nest egg they worked so hard to accumulate. Or, maybe you want to retire at an early age so you can focus your time and resources on a cause that is important to you. It doesn’t matter what your why is–just know what it is.

Without the right intent, your financial plan is just a series of projections, charts and recommendations. There is nothing to hold it together when challenges arise, and arise they will. But, if you understand why reaching your goals is so important to you, you are more likely to stick to your plan. Your intent becomes the glue that keeps your plan together when life wants to tear it apart. When the stock market becomes volatile and the losses on your statement begin to make you uneasy, understanding the investment strategy developed by your financial advisor is the best way to achieve the long term growth you need to be able to retire early and enjoy yourself, it becomes a little easier to stick to the plan. If you abandon the plan and sell your investments, you risk not reaching your goal. Because of your intent, your financial plan has a deeper meaning–it’s not just a report anymore.

The next time you review and update your financial plan, take the time to discuss the intent behind your financial plan. Make sure your financial advisor knows why your goals are important to you, the concerns you have, and anything else important to defining the intent of your goals and plan. Not only is it important to make sure you financial advisor is on the same page (you should have already determined their intent is right), but it’s important for you to state your intent out loud, or even write it down; by saying and writing it down, it becomes real.

Just remember, “every [financial plan] must begin with the right intent”.

On a side note, although I have not finished Perennial Sellers, I highly recommend it. Even though it is written to help authors, musicians, artists and filmmakers to create perennial sellers, there is plenty that can be applied to all careers. I also highly recommend Holiday’s other books The Obstacle Is The WayEgo Is The Enemy, and The Daily Stoic. You can thank me later.

Disclaimer: Nothing on this blog should be considered advice, or recommendations. If you have questions pertaining your individual situation you should consult your financial advisor. For all of the disclaimers, please see my disclaimers page.

1 thought on “Start With The Right Intent

Comments are closed.