Encouraging clients to invest in their dreams

We often have to stop clients from overspending. Sometimes, though, they mistakenly think they can’t afford something that they desperately want. Encouraging clients to invest in their dreams is satisfying but can be stressful for the adviser, too.

Eric came to me at 62 and asked with obvious anxiety whether he would be able to retire at 65. He told me he had had a rewarding career at a local bank until it was taken over by a regional bank, and then by a national bank. With each change he had felt increasingly overworked, under-recognized, and unappreciated. 

Although he now hated going to work, he was resigned to hanging on for three more years but couldn’t face the thought of anything longer. Also, his partner was a man 10 years older whose health was just starting to slip, and Eric desperately wanted the two of them to be able to spend as much time together as possible.

I sent them home so I could do my analysis. When they returned, I told Eric that he could definitely retire in two years in fact, I said, he could retire immediately. I showed him that he had enough saved up to cover expenses with a comfortable cushion for contingencies. He seemed dazed and delighted, and a little frightened. I explained that I wasn’t saying he should retire now, just that he could retire whenever he wanted to.

We didn’t schedule a follow-up appointment, so I called Eric about a month later to see how he was doing. I heard excitement in his voice, instead of anxiety. He said he had gone into work the day after our last meeting and told his boss he was quitting. Suddenly I was the one feeling anxious I hadn’t expected to have such a sudden, dramatic impact on his life! His boss had told him, belatedly, that the company valued his work and didn’t want to lose him and asked if there was anything they could do to keep him. Eric immediately suggested a raise and a three-day workweek and his boss agreed! He worked part-time for the next three years and then retired to Cape Cod with his partner.

[More: Encouraging clients to live a little]


It’s even harder when the client has a reasonable financial goal but someone else is undercutting their confidence. Caroline was a single woman in her mid-40s who decided it was time to stop renting and buy. About 10 years ago, she found a condo in a three-unit “triple-decker” building where each unit was a full floor. She liked the owners of the other two units. She had enough cash for the down payment and guessed that buying wouldn’t cost much more than renting. 

She asked my opinion. We worked through the numbers and I confirmed her instinct. She was elated and planned to make an offer.

The next day, though, she called in panic and distress. She had discussed the purchase with her father, who told her that she couldn’t possibly afford to buy a condo and that she needed to keep renting. Now she was feeling a lot of pressure to drop the idea. The fact that her father was an economics professor of some national renown was not making this any easier! I felt stressed myself. Had I made a mistake?

I had Caroline come back in right away. I asked her to tell me the whole story. After she described their conversation, she added that her father often discouraged her from doing things and that he made her feel incompetent. She valued his opinion but at the same time she was sorry she had even told him about her plans. Obviously, there were significant family dynamics at play here. 

I questioned her carefully. Did her father know her financial situation? No. Had he seen the analysis I had done with her? No. So what was he basing his discouraging conclusions on? She thought a little. “I think he’s just uncomfortable about seeing me as grown up, competent and independent,” she said. Aha! 

We went back through the analysis in detail, partly so I could show her the facts (again) and partly so I could reassure myself that I wasn’t leading her astray. She still felt that our underlying assumptions were accurate and we both agreed with the calculations. By the end of our meeting, she had decided to go ahead with the purchase. I said I would be happy to talk to her father about our assessment if she wanted, but she decided she could handle this on her own.

She bought the condo. Her father came to visit and to her relief, and mine, he loved it. He complimented her on having made a good decision and apologized for having tried to dissuade her. She not only still lives there still but she has referred one of the other unit owners to me.

[More: Encouraging clients to live a little]

Michael Broad is a financial planner and investment advisor in Newton, Massachusetts. Got a good client story or problem you’d like to see in a future column? Email Michael Broad.

The post Encouraging clients to invest in their dreams appeared first on InvestmentNews.

As our second lead editor, Cindy Hamilton covers health, fitness and other wellness topics. She is also instrumental in making sure the content on the site is clear and accurate for our readers. Cindy received a BA and an MA from NYU.

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