April 2024

Written By Andy Hart

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Wealth for the Unknowns

As a practising financial adviser, I have built hundreds of financial plans for real families. I’m well aware that these are estimates about people’s futures. We all know that “Man plans and God laughs.”

Within these plans, we include all the known knowns, but the "unknowns" are missing. The “unknowns”, by their very nature, cannot be planned for—or can they?

Having seen people’s lives unfold and personally witnessed their investment journeys, I’ve concluded that curtailing people’s investment returns because, according to the plan, their money is getting them over the financial finish line is madness. The ‘stock market’ is human ingenuity captured. Human ingenuity is a powerful force and a lucrative one at that.

Knowing that unknown financial shocks hit people out of the blue, I’ve no problem creating wealth for its own sake. We don't know what financial shocks people (and their families or friends) may face in the future. For instance, one of the biggest 'unknowns' I’ve seen is parents supporting adult children in divorce; this ‘trend’ is not going anywhere. Another example is unexpected health issues that require more money than the plan predicted.

While traditional financial plans aim to meet specific goals, it's crucial to communicate to clients that events may occur that are beyond their specified goals, and creating additional wealth will only provide them with more freedom and opportunities should the need arise. This will provide security and confidence in the face of the unknown.

It's essential for us, as financial advisers, to educate clients about the potential challenges they may encounter. By discussing scenarios that we’ve seen other clients encounter, we can help clients develop a more realistic understanding of their financial future. This awareness can motivate clients to prioritise wealth creation and make proactive choices to prepare in advance, knowing that they have a trusted guide to navigate these challenges with them.

As financial advisers, our mandate extends beyond mere wealth accumulation; it encompasses cultivating financial preparedness for the unknown, ensuring that our clients are equipped to weather life's unpredictable storms.

The "unknowns" may never be fully accounted for. Still, by taking a proactive and adaptable approach, financial advisers can empower their clients to face whatever challenges come their way, instilling a sense of control and empowerment in their financial journey.

📰 Articles & Blogs

3 Question Types To Go From Retained To Engaged Clients [16 minutes]. Engagement requires active involvement from the adviser and the client.

​How to Speak Your Client’s Language [5 minutes]. Learn to understand and use the client's terminology and definitions to establish rapport.

​Five Mistakes That Undermine Client Meetings [5 minutes]. Small things that seem insignificant can completely shift the dynamic of the interaction.

​Why is it so Easy to Disregard Behavioural Finance? [4 minutes]. We can't afford to ignore it.

​Invest for the Decades, Not the Years [5 minutes]. Do you want to bet on the years where things fail, or do you want to bet on the decades where they succeed?

​Master These Habits to Become a 'Supercommunicator' [5 minutes]. Master the art of meaningful conversations with clients.

🎧 Podcasts

TRAP 44 - Bricks and Torture [90 minutes]. The TRAP pack discusses the often emotional topic of property investment.

​8 Secrets To Asking Great Questions That Get Great Answers [38 minutes]. How to ask great questions that lead to better answers, conversations, and relationships.

📚 Book Recommendations

​Supercommunicators: How to Unlock the Secret Language of Connection by Charles Duhigg. The art and the science of successful communication.

Andy Hart
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