Lovett-Reid: Hope isn't a strategy

I’m a big believer in hope. Hope can get us through difficult times, help us imagine something better and give us the courage to keep going when life hasn’t quite turned out the way we expected. But hope, on its own, isn’t a strategy.

My husband, Jim Reid, knows a thing or two about this. Jim is an executive coach and the author of Leading to Greatness, and over the years I’ve heard him remind people that too many talented individuals work hard, deliver results and then hope the organization will make the right decision about their careers. They hope someone notices or that the right opportunity comes along.

There’s nothing wrong with hope, he says, but it isn’t a career plan. You're the only person who truly owns your career.

Every time I hear him say it, I think the very same thing is true of our money.

Your clients, and prospective clients, own their financial future. That doesn’t mean they have to know everything about investing, that’s what you’re there for as an advisor! In fact, asking for help can be one of the smartest financial decisions people make. But ultimately, individual clients have to own the destination.

And that begins with deciding what actually matters to them, not what should matter, what their neighbour is doing or what somebody on social media says they ought to want.

Maybe it’s buying a home, retiring comfortably, helping their children, travelling, or simply having enough financial breathing room to deal with whatever life sends your way. The particular goal matters less than the fact that it is genuinely theirs. A meaningful financial goal is important enough that you are willing to make choices today to have it tomorrow.

Once someone knows where they want to go, they need a plan for getting there. That’s where you come in as an advisor.

Everyone Deserves a Financial Plan

I have always believed that every single person deserves a financial plan. Not necessarily a complicated binder filled with charts and projections, and certainly not somebody else’s plan. Their plan.

Interestingly, that’s also how FP Canada thinks about financial planning. The process begins with understanding where you are today and where you want to go, developing strategies to get there, putting those strategies into action and then monitoring and adjusting the plan as circumstances change.

I like that because it recognizes something we all know to be true: life doesn’t stand still, so neither should a financial plan.

Financial planning is also about much more than choosing investments. It brings together the different parts of our financial lives and helps us understand how today's decisions affect the life we want tomorrow.

Ultimately, a good financial plan isn’t really about money. It’s about what a client wants their money to allow them to do.

The practical part is turning those intentions into something concrete. The Financial Consumer Agency of Canada encourages Canadians to identify and prioritize their financial goals, put a dollar amount around them and establish a timeframe for reaching them. That simple exercise can turn “I hope I’ll be able to retire comfortably” into a goal that your client can actually plan for.

Then comes the part no spreadsheet can predict perfectly: life.

Markets fall. Jobs and relationships change. Family responsibilities grow. Health issues arise. Opportunities appear that we never could have anticipated.

A financial plan isn’t a promise that everything will unfold exactly as expected. It’s a framework for making decisions when it doesn’t.

When life throws clients a curveball, help them tweak the plan so they don’t abandon it. Maybe the timeline changes, the amount you save changes or even the goal itself changes because you have changed. That isn’t failure. That’s planning.

Hope Needs Conviction

There is absolutely nothing wrong with hoping for a wonderful future. I hope you have one.

But hope works better when we give it something to work with.

Help your clients decide what matters to them. Help them put a number around it. Build a plan. And make sure they keep showing up for that plan, even when life requires them to change it.

Hope helps us imagine where we want to go. A goal makes that future tangible. A plan gives us direction. Conviction is the willingness to keep making choices even when it gets tough.

Hope may be where we begin. Conviction and a plan get us there.