There are many different types of goals people want, and the process is different for everyone. Roger and Mary are a great example of how engaging in proper lifestyle financial planning can uncover the true goals underneath your actions, not just the ones you think you want.

Roger and Mary were both in their mid 60s when I first met them back in 2007. During our initial Discovery Meeting, I was intrigued and somewhat concerned to find out that they’d had three different advisory firms act for them in the last four years. Why were they now coming to see me? What was so bad about the previous firms that they wanted to change advisors again? With some further digging it became apparent that Roger was unhappy with the returns he was achieving on his investments; for him, he wanted “more, more, more”.

From the simplest of glances at Roger’s existing portfolio I could see that there was nothing at all wrong with the investments he held, and very likely nothing at all wrong with the performance he was achieving. Better performance can only often come with taking on more risk. But why was Roger so keen on getting more returns on his money? Taking more risk and chasing performance can be a very dangerous thing to do and this was certainly not a philosophy that we would advocate. 


You only live once

Upon further discussion and only by me standing my ground and being firm with Roger was I able to establish the true beliefs behind Roger wanting “more, more, more”: Roger had been ill. He had already had a heart attack and a stroke and was worried about the long-term prognosis, i.e. how long he would live for. Mary was also unwell and suffering from multiple sclerosis, which is a debilitating disease which, over time, will get progressively worse. 

Roger was Mary’s main carer, and he was terrified that something would happen to him, leaving Mary destitute and without “enough” money to provide for her care. In his mind, the answer to this was to keep accumulating all the money they possibly could and to get “more, more, more” (i.e. better) investment returns.

The most important question for me was “how much is enough Roger?” This is not a question that Roger could answer, of course, most people cannot. It was also a question that none of the previous advisory firms had bothered to ask.


Getting it right

I explained to Roger that I have no magic crystal ball and that while we believe our investment portfolios to be very good, I could in no way guarantee him any better returns than he was getting now. I also explained that in no way did I want Roger to go through the same thing over again and leave us as a firm in 18 months’ time to seek “more, more, more”.

It was time to break the pattern. I suggested to Roger that what he actually needed was some proper objective-based financial planning. The sort of planning that would help him understand how much more he needed and what would happen to Mary from a financial perspective if the worst were to happen. He reluctantly agreed. 

Having set aside the investment performance issue, we spent some time building our understanding of what was important to both Roger and Mary. Mary for her part was also concerned about what would happen to Roger if she passed away. Who would look after him and how would he cope financially? They both had good pensions in payment and, by any measure, a decent sized investment portfolio. But surely these would not be enough? 


Emotional goals and material goals

Having spent a lot of time considering the very important emotional side of things we were able to move onto some material goals. I asked: “If I had a magic wand, could wave it now and you knew you had all the money you would ever need, what would you be doing and buying right now?”

From this discussion, I was able to glean that Roger’s car was getting a little old and that he would love to buy a new Volvo Estate. But, this was of course out of the question as he just needed to keep building “more, more, more” to make sure he took care of Mary when he was gone. The Volvo was the only material thing that Roger could come up with at this stage; his focus was still on taking care of Mary.

This is not always an easy process. Some people resist the deeper conversations and want to stick to the agenda they have in their mind at the outset. But to his credit, Roger went with the flow and instructed us to pull together a proper Financial Plan for him.

This involved looking at all of the income and expenditure, what adaptations may be required to their house now or in the future, whether a house move would be needed, what type of care may be needed in the future and what this may cost and so on. 


Sometimes it’s right in front of you

We analysed several “what if” scenarios and ran the figures to map the impact of Roger or Mary passing away in the short, medium and long-term. We also analysed the existing investments, the income they could produce, and the level of risk being taken.

The conclusion was that on the assumptions used and no matter how the “what-ifs” were run, they already had all the money they were ever likely to need. They didn’t need to take any more risks and they didn’t need better investment returns: quite the opposite. They had enough already.

Roger, as you can imagine, needed some convincing of this. Using live Cash Flow modelling we were able to clearly demonstrate that this was very much the case. This was quite an emotional meeting for all concerned. The relief for Roger was visible and immediate. 

We went on to put in place an investment strategy for them that completely de-risked their portfolio, gave them some capital to spend immediately, and produced a regular income stream to cover all of their needs. 


Asking the right questions, pursuing the right goals

Before we had carried out this exercise, Roger was someone who was absolutely focused on getting more performance out of his investments and therefore taking more risk. Far more risk than he ever needed to. He was unsettled and unhappy. He was changing his advisors and his investments for the wrong reasons. 

Our initial role in this was to encourage Roger and Mary to stop and think about what was really important to them. By doing this and by carrying out a proper analysis of the data, we were able to demonstrate that they had all the resources needed to be financially secure for the rest of their lives. 

This enabled them to make the most of their remaining time together. They could live the life they want to lead, relax, and do the things they want to do. I believe that we changed their whole mindset that day, and perhaps even their lives. 


The new Volvo

Two weeks after the strategy meeting that confirmed our conclusions, Roger arrived at our offices unannounced. He was very excited and was very keen to show me his brand new Volvo Estate that he had just taken delivery of. 

Ten years on and I am very pleased to say that Roger and Mary are still going strong. Roger has yet to suffer any further serious illness. Mary is a lot less mobile than she used to be, but they do still get away on a regular basis and still come in to see us. They do not follow the markets or worry about investment matters. They leave that to us while they just get on and enjoy their time together.


What can we learn from Mary and Roger?

Roger and Mary were in a constant state of high anxiety about money and having enough. It was holding them back, impacting on their lives, and leading to poor decisions over investments. 

By conducting a proper financial planning process, we demonstrated that they had enough and could relax and get on with making the most of it. It was time to stop saving and time to start living. 


Where do I start?

All of us have things that we would like to achieve in our lives. It could be two, five or ten years down the line. Perhaps we may want to leave a legacy of some kind. To realise these dreams, we need to be both focused and financially organised. This is the essence of True Lifestyle Financial Planning

It’s with this lesson in mind that I set out to write my book, Live Life With Purpose: A Guide to Getting a Life Plan and Sticking With It. This book will help you take the steps to live life with purpose. It will help you gain clarity. It will show you how to implement the six steps needed to create a sound Life and Financial Plan so you can ultimately achieve your goals.

We’re offering free copies of Live Life With Purpose to anybody who feels they would benefit from it. Simply go to this page, tell us where to send it, and we’ll pop a copy in the post for you.

I hope you enjoy reading the book and putting into practice some or all of the lessons it contains. Even if just one idea sparks you into taking some action, then I have achieved what I set out to do.