Exploring Retirement Goals With a Financial Planner

In my ongoing quest to improve my financial life planning skills, I recently attended The Gathering in Portland, Oregon. What is The Gathering? It is a two-day meeting of veteran financial life planners who are Money Quotient practitioners.

Money Quotient (MQ) is a nonprofit organization dedicated to helping planners explore a holistic approach to delivering superior financial services and advice. So, at The Gathering, a small, dedicated group of financial planners using MQ tools get together every two years to talk about big issues facing financial planning and to engage in deep conversations about how we need to evolve.

This gathering marked the second one I have attended, and it was a fascinating experience—again! I wanted to pass on several “aha” moments I experienced with you.

1. Any Group Effort Must Go Through the Groan Zone

What is the groan zone? That is the zone at the midpoint of any attempt to do something new or find a solution to a complex problem. It is the zone that comes after the initial stage of people exploring ideas and feeling the excitement of possibilities.

In the groan zone, individuals begin to feel frustrated and often latch on too quickly to one suggestion as the solution because of the discomfort they feel from a lack of clarity. The groan zone is the storm before the quiet of when diverging thoughts finally converge into solutions and decisions that become clear and motivate people to act.

I experienced this in small groups as we pushed ourselves to focus on the theme of The Gathering: “Exploring Ways to Prepare and Guide Clients Through Difficult Life Transitions.” What did I learn from the process? That I must sit through the discomfort of the groan zone and wait for the convergence to happen, that I cannot look for easy solutions just so I can avoid feeling uncomfortable. If group members have open, honest and caring relationships, amazing results will happen. (For related reading, see: Financial Planning: It's About More Than Money.)

2. It’s About Exploring Possibilities, Not Finding the Answer

During one session I realized that, as financial planners, we cannot simply ask people, “What do you want?” That is too limiting. Besides, most of us do not know what we want. And if we accept your “This is what I want” at face value, then we might lock you into a path that does not align with where you really want to go.

Since you do not know, your financial planner needs to help you explore. And then you must come to your own conclusion about the possibilities you want to pursue. That is the real objective—to help you become self-aware, not for financial planner to give you the answer. So you both must go on a journey of uncovering and discovering. 

Let me give you some examples:

I often hear clients say in a meeting, “I want to retire at 55.” I get that a lot, but it is a superficial answer. And my response is always “Tell me more.” In other words, tell me more about why you think you want to retire at 55. If your life goal is to do rewarding work that makes the world a better place, then turning 55 has very little to do with that goal. It is an arbitrary number that you have anchored on as a goal. There is no reason you chose age 55 other than that is your definition of early retirement. (For related reading, see: Want to Retire Early? Think Again.)

So maybe you should focus on the work you are doing now rather than a volunteer job after retirement. Which leads to the question “What makes a job rewarding to you? And what do you think the world needs to become a better place?” If you cannot answer those questions for yourself, then no magic transformation is going to happen at age 55.

Other people anchor on a particular asset size as their retirement goal. So they will retire once they have built up an investment portfolio of $1 million. Once again, it is an arbitrary number they have anchored to as an easy solution to their unanswered questions.

What does retirement look like for you? How do you define true wealth for yourself? What facet of the wheel of life (an MQ tool) does your $1 million really address? What facets are you not thinking about?

Yes, these are big, complicated, emotional questions. The job of a financial advisor is to help you explore the possibilities, especially the ones you have not thought about, then go through the groan zone with you so you can come out on the other side with financial objectives that truly facilitate your life goals.

(For more from this author, see: Retiring Early Can Create Tax Saving Opportunities.)