Many people view financial planners as stock market wizards with a Nostradamus like gift for predicting the ebb and flow of the financial markets. Beyond the fact that investing is an endlessly complex world, a good financial planner would do well to remember that investment advising is only one small part of their job and that the true purpose of a financial planner is to help clients build healthy financial habits in every area of their lives.
David Mendels, a financial planner at Creative Financial Concepts, has a story he tells clients to help broaden their perspective. In his early days as a financial planner, a married couple he knew from college were killed and their 3-year-old daughter orphaned. There was some concern from the couple’s respective families over who would care for the girl. This could have led to expensive litigation as well as emotional stress for the girl.
Instead, the couple had taken the time to draw up a will, specifying who would become their daughter’s guardian in the event of their death. According to Mendel, financial planning is about so much more than investing and building a retirement fund. It is about planning for the worst so that when it happens a family will be able to weather it. Writing up a will helped provide financially for a little girl even after her parents death. For Mendel, taking the step to write a will is just one part of helping people to think about their future- financially and otherwise.
He is not alone. Mark LaSpisa, president and managing advisor at Vermillion Financial Advisors, says his greatest challenge when working with young clients is teaching them how to save money and understand that buying a nice car now might prevent them from buying a house for their family or paying for their kids college education. Teaching clients how to think about the future can be difficult, but it might very well be the most important part of healthy financial planning.