As an advice-based financial planner, you likely work with plenty of clients who have negative beliefs regarding money. One of the most pervasive and damaging is having a shameful attitude either toward spending money or toward not having saved enough for retirement. A shameful attitude can come from childhood, from working with a bad financial planner, or from hundreds of other sources. The key is to identify it early on in your working relationship and find ways to mitigate it so it doesn’t sabotage your clients’ financial plans. Here is the process for identifying money shame in your clients and reducing it as you work toward their goals.
Focus on Discovery
I always go through a lengthy discovery process with all my clients that involves personality testing and takes into consideration human behavior models and ways they take action. Many times, these tests will turn up negative attitudes surrounding money, including shame. You may have to go a little deeper by talking to your clients and finding out exactly where they learned that shameful attitude and how it affects their financial decisions and their overall feelings about money. Once you have this information, you have the tools needed to help.
Find Out History
One of the reasons many couples fight about money is due to the fact that they have very different views on saving and spending. They likely have different levels of risk tolerance and one may view spending money as a shameful act based on how he or she was raised. When I work with couple clients, I always make sure the three of us talk about their upbringing and how their childhoods differ. If one member of the couple had parents or influential grandparents who lived through the depression, I often find this makes them more likely to be fearful of the market and experience shame when they’re doing well. Help your clients see the others’ point of view, history, and how that may be affecting their current decisions and attitudes.
Give Perspective
When your clients have a fixed mindset regarding money—especially when it’s one laced with shame—they may not be able to see the forest for the trees. What I mean by this is that they may see any fluctuations in the market as a sign of impending doom. It’s helpful in these situations to show them how the market has performed over their lifetimes. You can point out that the market tends to go through a major market correction approximately ever five years and that, over the long-term, it has proven to trend upward.
Hit the Reset
If you’ve earned your clients’ respect by acting as a fiduciary and a mentor, you can usually help them change their shameful attitudes toward money. Make an agreement with them to hit the reset button on their attitudes and past feelings about money. Then show them how vital is it for them to stay in the market until they reach their financial goals while still providing a safety net for those who are less risk tolerant. When you suggest a ‘clean slate’ after exploring why they may have felt money shame in the past, many of your clients will be able to re-wire their brains and move forward in a healthier manner.
Do you work with clients who have a shameful attitude regarding money? If so, you need to help them work through it if you want to assist them in reaching their retirement goals. If you’d like to learn more about this topic, please watch my video or reach out so we can chat more.
When you become a mentor to your clients, deeply understand them, and guide them toward a better future, then you’ve learned the ways of a financial caregiver. You’ve come to know what it means to be a true purveyor of advice, and how to use money as a conduit to a more fulfilling life for yourself and those you serve.
Patrick Tucker, owner of True Measure Wealth Management and founder of True Measure Financial Advisors, has over 20 years experience in the industry and has spent the last 15 years learning the ins and outs of the fee-only advisory business. He’s spent over $500,000 finding mentors, studying consulting businesses, taking courses, studying the soft sciences, running trial and error experiments, and learning how to be an entrepreneurial financial advisor. He’s simplified this into an easy to use blueprint for anyone who is entrepreneurial-minded and is tired of the sales culture. Patrick has been able to acquire over $158 million under management with little to no money spent on marketing.