This past weekend I had two back-to-back client interactions that returned me to the debate of whether there is a need for ongoing financial counsel.

Both couples are in their early-to-mid thirties, no children, and have comfortable surpluses for discretionary spending. Neither case involves any immediate financial problem to be solved. All are well educated, some even in highly quantitative fields. In the eyes of conventional wisdom, both couples have done pretty well with their money already and probably will end up fine without the help of a financial planner. However, they both came to me because they want to understand more and get better with managing their finances, and would like some professional guidance.

The first couple was very happy with having a partner in their personal finances. Without prompting, they told me how much they appreciate having me to go to for answers any time, to keep them accountable for and updated with the things they should be doing, and to be the sounding board for what they hope to change and accomplish in life. I was granted the title of Financial Planner / Marriage Counselor, and it made me really happy to know that I’m contributing to both the tangible and the intangible wellbeing of my clients.

The other couple was more skeptical of the value of ongoing service, like many others that have consulted with me. Their financial life is very simple, and they do not expect the situation to change. It seems they can definitely benefit from my services right now, but is it really something they need or want in the long-term? Even without a fixed-term contract, having an implicit ongoing relationship still seems scary to them. And the funny thing is, I totally understand their lack of confidence in what they are paying for when they don’t have any comparable experience.

Providing my service in the same way to two objectively similar couples, I received such different reactions. Why is that? Is it really because competent people don’t need ongoing financial advice? Or is it just a matter of perception that what they need is a one-time direction, not a long-term commitment?

Pre-existing perceptions are hard to break with logical argument. Since I’ve written extensively about the merit of ongoing advice through rational reasoning, maybe it’s time to try analogies with some everyday life experiences that hopefully will make it click.

Map vs. GPS

As the idea of “making a financial plan” spread, many were sold on the notion of getting a professional “roadmap” for them to study and follow afterwards. Knowing how to read a map is still a useful skill, but the time has come that GPS is available and accessible at a very low cost. It gives you step-by-step instructions, taking into account information such as real-time road closures, traffic jams, and construction that a traditional map does not have. Moreover, a GPS shows you where you are on the map and where you are heading. When you go off track, it automatically calculates another route to take based on your new location.

Looking for a financial plan instead of financial planning is like throwing your GPS away and reverting back to a paper map.

Looking for a financial plan instead of financial planning is like throwing your GPS away and reverting back to a paper map. The map is still useful, but as you move on from where you were, you need to diligently keep track of your speed and time so you can navigate where you are going. Most likely you will still get to your destination, but with a lot of wasted effort, second-guessing, and probably getting lost a few times while blaming your spouse.

Most importantly, you may not be able to find maps in the near future! (When we traveled across the country this summer, we couldn’t find a road atlas in multiple stores, while GPS devices were displayed in full view.) The more efficient and effective service to meet your goals will surely take over in the future. In the world of your personal finances, ongoing financial planning and advice is the trend for the future.

Is your checkup due?

What other service professional do you visit whether you feel you have the need at the moment or not? I thought about this for a while, and the answer became apparent –


I hope this word did not trigger your pain reflex, and I definitely think that working with a financial planner should be a more pleasant experience than going to a dentist. Whether you have good teeth or bad teeth, you should be visiting a dentist at least once every six months. The same goes with your personal finance checkup, if not more.

Have excellent dental hygiene? Great! But you still want to get a checkup and cleaning periodically. Sometimes your dentist will tell you there is one spot you constantly miss and will show you how to clean properly. Other times he/she may find a small cavity that is no big deal but needs a filling. For some people, they just keep going back to hear their dentist tell them they did a good job flossing and brushing, so they know they are doing everything right. For others, the dentist may find deteriorating enamel and gums that needs attention, even though you’ve done everything right.

And then there are people who only go to the dentist when it hurts. Dentists are there to treat the disease for sure. However, for everyone else, dentists are there to continue to monitor and provide professional attention so you know whether you are doing it right and can spot issues early. In fact, you need periodic check-ups so benign issues don’t turn into serious issues. On the positive side, the periodic professional cleaning returns your teeth to a better state than they were under your own care. It’s such a basic care that many medical insurance policies cover the six-month regular visits to the dentist without dental insurance coverage.

I think this describes perfectly what financial planners do on a continuous basis. Of course you can come to us when things are not in order, and never come back after we’ve helped you solve your problem; nevertheless, it will be difficult for you to change the behavior that made you sick in the first place on your own. The better way to go is to continue to monitor and see if you make progress.

On the other hand, being in a good financial state doesn’t absolve the need to have regular professional attention. A checkup will reveal how well you are actually doing with your finances, compared to what you did before. (Think about the dental X-rays you are getting every year.) It may show some crack or it may show you are doing perfectly, but there is always more you can do to create a healthier habit. Even if you get everything under control, it’s likely you will benefit from the portfolio rebalancing and monitoring every few months (like getting your teeth cleaned).

And there is the genetics involved. Some people can maintain healthy teeth even without brushing regularly, while others always come back with some issues after having perfect care. It’s something we are born with. Your personal finance is the same. You may have graduated with no student loans and landed a job when the economy is good, while your good friend had to pay for the entire college cost on debt and graduated when the economy crashed. There are many things we cannot control. You are not always in a good financial state because of your effort, and there is no use in complaining that you became an adult at the wrong time. Whatever financial situation you are in, you can make the best of it with ongoing professional assistance.

Waiting until you are close to retirement to get financial advice is like avoiding going to the dentist until your normal care cannot keep your teeth healthy any longer.

Lastly, the earlier you start doing this, the better. That is why financial planning is for young people. Just like you get your children to an orthodontist or have your wisdom teeth taken out when you are young, so should professional attention on your personal finances start as early as possible. The earlier you start, the more time you have to make them better and last longer (both for your teeth and your finances.) Waiting until you are close to retirement to get financial advice is like avoiding going to the dentist until your normal care cannot keep your teeth healthy any longer. It might just be too late.

In summary, young people need continuous financial planning, not a financial plan. Now is the time to start!

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