Guiding Clients Toward True Prosperity: Beyond Financial Advice, a Journey into Client Behavior

Episode 935 June 12, 2024 00:25:23
Guiding Clients Toward True Prosperity: Beyond Financial Advice, a Journey into Client Behavior
Purposeful Planning Podcast
Guiding Clients Toward True Prosperity: Beyond Financial Advice, a Journey into Client Behavior

Jun 12 2024 | 00:25:23


Show Notes

Join us for another exciting webinar hosted by Dean of Individual Development at PPI, Melissa Mitchell-Blitch with guest speaker, Danielle Howard.  This session will explore the imperative transformation needed in the financial services industry, focusing on fostering healthier client relationships with money.  It will highlight the impact of money mindsets on financial beliefs and behaviors and discuss exercises to enhance awareness and shift these mindsets. Participants will learn about the limitations of traditional financial planning and the importance of understanding one’s identity, processes, and outcomes to cultivate a positive financial life. The session will also cover self-reflection techniques to explore and improve one’s relationship with money, offering practical tools and resources for deeper insight. 



Danielle Howard is a Certified Financial Planner®, author, speaker and personal finance thought leader. Her 27 years of client engagement and financial world experience has led her to become a catalyst for change around the financial tools, techniques and temperaments that construct a person’s financial life. Understanding the integrations and implications of a whole-life perspective on money mindsets and financial decisions, she guides people on the progressive journey of financial wellness.

Bridging the gap between Wall Street and Main Street, she brings complex financial topics and concepts down to earth. She opens the door to new conversations around money, breaking down the taboo topics of the past to engage, educate, encourage her audiences.

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Episode Transcript

MELISSA: I am Melissa Mitchell-Blitch, and I help enterprising families discover what’s possible, even in the midst of complexity and conflict. I help them have conversations that matter and navigate the pathway of change. I also serve as the dean of individual development for the Purposeful Planning Institute, and I’m excited to host this conversation today with Danielle Howard. Danielle, welcome. DANIELLE: Thank you for having me, Melissa. MELISSA: Danielle is a certified financial planner, an author, and a speaker. She's been in the financial services field for almost three decades and has become passionate about being a catalyst for change around the financial tools, techniques, and temperaments that construct a person's financial life. Danielle takes a whole person, a whole life perspective on money, mindsets, and financial decisions. She guides people on a progressive journey towards financial wellness. Danielle, again, very excited to have you here today. And I think the question that begs to be answered first is this question of change. You and I share a growth mindset. We believe there’s always an opportunity to learn and grow and evolve. But for some people, change is a dirty word. Help us understand, make the case for change. Why is change needed in financial services? DANIELLE: We don’t like to talk about change or money, so we can go all sorts of directions. Changes—I mean, we know it’s inevitable. It's the way we live our lives, and as we embrace change as a professional, as an industry, in our practices and personally, you know, I think it’s really important that we embrace this personally and that we walk the walk before we talk the talk. But I think over the past, I don’t know, 15 to 20 years—again, I've been in this business for about 30 years, and I've seen change. It's been slow but necessary. And I think with some of the challenges we’ve had with the economic meltdowns that we’ve seen and more swings in the stock market and continued angst about how people are going to pay for their retirement, or just the narrative that people have grown up with and their parents' retirement, or how they deal with money—it hasn't been working. And so how do we as an industry, as personal advisors and ourselves, start looking at change in the financial world, from how we're dealing with clients to the products that are coming out? So there’s lots of change going on, and whether we like it or not, it’s part of who we are and what our industry is dealing with at this point. MELISSA: So what I heard is that it’s not that change hasn't happened in the three decades you've been in this space, you've seen it, but you said it hasn't been working. Unpack that a bit more for us. DANIELLE: Well, I think it’s just been really slow. I think change, we'll have an economic meltdown back to our great recession. And I thought, “Oh, boy, this was really painful, and people are going to start looking at their financial lives a little bit better or deeper, and unpack it a little bit.” And I think people might have gone, all right, maybe it isn’t about building bigger nest eggs or making the biggest return in the market, and I had this Pollyannaish idea that, okay, people are going to feel this pain. And whenever there’s enough pain, you go, "Okay, we don’t want to repeat that. But what needs to happen?" And I think because money is so complex, and it’s so immersed in every aspect of our life, whether it’s how we bring it into our lives, how we give it away and share it, how we nurture and invest and grow it, or how we decide to spend it. You know, all of those components that make up our decisions—people are pretty much just on default mode. And so unless you take a pause and take a deep breath and be willing to create an awareness of what wasn't working, it’s very hard to make any change about your financial—whether it’s mindsets or behaviors or look at the tools you’re using. So again, I think it’s very, very entrenched that people will just do their money the same way. And so as I am working with individual clients, the area of change that I’m working on is looking at their mindset, their belief systems, their scripts. I can’t do a whole lot as an advisor about industry—that’s all out there, and there’s another role, but in our short time together today, we just want to look at as individuals in our personal financial journey. You know, how do we look at who we are with money? What money means to us, and how do we want it to be a flow of our intention as Lynn Twist talks about, how do we want it to move through our lives with meaning and purpose and that energy that’s created with money? How do we want to use it for good? MELISSA: Danielle, help our listeners understand more. You said, well, first I'll back up. Pain is a powerful motivator, and it can inspire change, but when that pain goes beneath a certain threshold, the motivation goes down. And you’re suggesting one of the changes that I hear you suggesting is a shift to get to—you mentioned money mindsets and scripts. Unpack for our listeners what you mean by that, and give us some examples. DANIELLE: All right, we all have scripts. Dr. Brad and Ted Clontz have done some amazing work on money messages, and there’s a lot more being done in this area, but we all have our upbringing. We all are wired. It's in our DNA. You can look at a family and you can have two kids that were born two years apart, and they deal with money very differently. So we know that our money mindsets are a part of different facets. It's our DNA. It's what we saw growing up around money. It's what we heard about money. It's our experiences. As we’ve gone through life, what has happened to us around money, and that imprints on our brains, and we know that that imprint is going to have an impact on our belief systems about money. So for example, I grew up with money being fun. They would pour the change in the sand pile, and we would all dig in and find the coins, or we would run through the airport and look for change in those old-fashioned telephones. Does that say how old I am? So in my mind, money was fun. So my beliefs around money were, it wasn't painful to me. It wasn't difficult for me to start incorporating different messages around how money was going to show up in my life. I've heard other examples when I've done some of my workshops of money always being argued about in my house. And so my belief system around money is, it’s evil, or it’s nasty or it’s dirty. So to look at what your money messages were, and there are exercises that are out there that help you create that awareness of those money memories, and then the messages that came out of those memories, and then the belief systems that we either want to unpack or create an awareness around to say, is this serving me? Do I want to build on it as I face change in my life, or is this a belief system that I need to reconsider and look at maybe it’s not serving me. So, is it based on scarcity? Is it based on abundance? And as we create an awareness about ourselves, we can then change our internal scripts. We can change our belief systems. We can then start changing our belief, our behavior, and create a virtuous cycle about creating healthy financial identities and lives moving forward. MELISSA: So mindsets are developed over time through experiences. You use the word "imprint." Those experiences imprint a mindset, a belief about how the world operates and how we need to show up in the world, and what money is, what its role is, and it becomes the operating system, correct? Our thoughts, feelings, and behaviors, even outside of our consciousness. And so you’re describing exercises that clients can go through to get more aware of the operating system that’s driving them, their mindsets. And you talked about, like, for some like you, money is fun. For some folks, what’s been imprinted on them is money as a source of conflict and stress and strife. So I’m curious that we can imagine what that may look like in a family. Oh, boy. How does that impact? Oh, covid conversation, but we're focused on the Financial Services today, and so I’m curious how those client money mindsets impact how a client will interact with their financial advisors. DANIELLE: I think, in our field, again, the old way of doing it was, financial planning 1.0 was all right, let’s set the goals. Let's get to those lines in the sand, whether it’s to buy that house, send your kids to college, get to retirement, and we crunch the numbers, and we say, all right, if you want to accomplish this goal, here’s what you need to do on a monthly basis at this rate of return. And we had this straight line to get to people's goals. And over time, I've experienced that that doesn't necessarily work. We can set that in front of a client, and we can tell them, okay, you told me what your goal is. But first of all, do they really know what their goals are, or is this something that has been pushed upon them by the financial services industry or the advertising industry, saying, this is what your life should look like. This is who you should look like. So that’s a fallacy in and of itself right there. But we as advisors were taught to just put the analysis together, give them the book or the binder to say, here you go. This is what you need to do every month to get where you want to go and people leave, they put it on a shelf and never to return. Or they run into you at the grocery store and go, oh, I've been meaning to, oh, I should, and they’re filled with guilt. Or they avoid you. They go down another aisle because they don’t want to see you because they haven't followed through. So in my time in this business, it’s like, what’s broken with this system? And when I read James Clear's Atomic Habits, it kind of clicked. It went, oh my gosh. James Clear talks about the idea of, we set the goal. You need to have a goal or an outcome, you need to have the processes to get to that goal. But we also have to look at identity. And if we don’t have all three of those components, the identity, the processes, and the outcomes, they all interact and they work together. So what I found is, because money is so wrought with either challenging mindsets, and I’m not saying everybody, we all have a little bit of angst around money. It's just opportunities for growth, but if we don’t help people create a positive financial identity, whether it’s how they bring it in, how they give and share it, how they nurture and grow it, or how they spend it, because those are all slightly different but they’re all wrapped—all those four components together with positive identity and positive processes and positive goals—that’s the magic that creates a healthy financial life. So that identity piece. So then I started thinking, okay, how can I help people understand their identity around money? And that’s where you start looking into all of these folks that have done all the psychology work on how our brains work and how we get these scripts going on in our head and how we need to look at, are they serving us or not serving us? So creating that threefold component of creating a healthy financial identity, creating the processes to get you to that desired outcome. And I'll share that James Clear talks about, if you’re a smoker, and you decide you’re not going to smoke, you can set your goal. "I’m going to quit smoking a year from now." Or, within this next year, I will have stopped smoking, and you can get the patches, and you can tear up the cigarettes, and you can toss them out, whatever. But if you don’t change your identity and start saying, "I’m a non-smoker. I don’t smoke," you will end up sabotaging yourself. And it’s the same in our money. If we don’t change our identity to, "I make healthy financial decisions. I am a wise saver. I am a prudent spender," I've really looked at what some positive identities are around money. And this isn’t the, "I’m going to manifest a million dollars in the next two years." So it’s a lot more to me, down to earth, and I think it’s just an important part that as advisors, we need to figure out ways to bring this to our clients. One, we have to do the work ourselves, and then secondly, how do we bring this to our clients in a way that will support them in creating new habits, in creating these positive identities, that they will then create this virtuous cycle towards moving to not only their goals, but just their identity around their true worth, their idea of prosperity, not the outside world, but looking inside themselves to figure out what my idea of true wealth is. MELISSA: So Danielle, clients can have a plan and a process. What's the outer game towards their end game, what they say their goals are, and you touched on an important point of, are those really their goals, you know? Or is it what they think their goals should be? Their inner game, that mindset, that sense of self drives the outer game, the behaviors they actually do, and drives the end game for clients who are like, "Yeah, I hear you. Danielle, I could use some inner work on my mindset and my sense of identity and those money scripts." I'd be curious to hear just a few things that our listeners could start to do on their own, because not everyone has an advisor like you to walk alongside them in this journey right now. So if they want to get started now, what self-exploration might they embark on simply to get this process started? DANIELLE: You can sit down after a cup of tea, a cup of coffee, and just spend some time thinking about, what kind of memories do you have around money? And again, it can be very, very broad-based. The Clontz talk about doing it with your non-dominant hand and either draw pictures or write little scribbles. But just in the process of using a non-dominant hand in writing that out, it releases different parts of your brain and you start thinking, it triggers old memories. I don’t know the details of what it does in your head, but it’s pretty cool. So write down your memories, and then just spend some time with it. Think about what message did I get out of that memory that I babysat and earned my own money and was able to buy my first bike? And what message? Well, money gets me things that I want. Money, I felt really good about myself being able to do that myself. So just journal, just script it, and again, it can be a fairly painful process. There may be stuff that comes up that is painful. I also do a process of financial forgiveness, where we will walk people through a ritual of recognizing that there was some pain around some things that, and it happens to all of us. We've all been hurt by money, whether it was ourselves that we inflicted on somebody else, whether it was inflicted on us. And there may be a process of financial forgiveness, where you write something down and then go through a ritual of releasing that, either burning it or tearing it up into little pieces and putting it into the river. Or how do you want to let go of whatever was holding you back and then spend some more time going, what might be a new belief that I want to try on a new identity? It’s like we go to our closets and we look at something and go, do I want to put on the same old, same old, or maybe there’s something back there that I haven't worn in a while, that would lighten up my life. Or maybe I need to, I don’t want to say, go shopping, but maybe you need to try something different on. And what would that look like? What would it feel like? It might mean, boy, if I’m going to try on a new script around my spending, if my identity that I want to try on is, I am a wise spender. How does that show up in your behavior? Might you have to hang out with different people? Might you have to have different conversations with people that you’re interacting with? I’m choosing not to go out Friday night, but let’s have a potluck and play games at my house. It will take intentionality and awareness and follow-through to start changing this cycle and changing the scripts in our head. So we have to have behavior that follows suit, and then as the behavior will continue to support us in creating those new belief systems and that new identity. And it takes time, and it’s a dance. It's two steps forward and one step back. But we can really start creating that identity that will then build on our belief systems, which will help us to show up with a different behavior, which builds on our identity. And you start creating this virtuous cycle. MELISSA: A metaphor is coming to mind, Danielle. As I was listening, it's like, we can plant seeds of good intention and real effort, and we can plant those sort of seeds, but if we haven’t prepared the soil, and it’s not consistent with the soil, how do they just support those seeds growing? They may sprout up but then die out. If we want those seeds of intentionality and effort and genuine motivation to be able to take root and thrive over time, we’ve got to prepare the soil. And I hear you saying it could be as simple starting this process could be as simple as sitting down, with your favorite cup of coffee or tea, and just getting curious. What sort of experiences have I had with money? How might that have shaped me? How do I really feel about money? Just getting curious. And I've said that word multiple times, curious, because critical. What's wrong with me? Why do I keep doing this? For critical, judgmental, our self-protective strategies. Even against ourselves. So if we really want to understand what’s driving this, getting curious is crucial. Thank you for sharing with our listeners some very practical steps that they can begin to take to learn more about their money scripts and their mindset as it relates to money. For folks who want to learn more about you, Danielle, and your work, how can they do that? DANIELLE: You can find me on our website, which is wealth by design, number four, letter or MELISSA: Fantastic. Well, Daniel, it has been a pleasure having you as our guest today. DANIELLE: Thank you, Melissa, appreciate the opportunity.

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