They were my first financial planning clients, so I was excited and a bit nervous as we shook hands and I led them into my office. I pointed to the long couch opposite my own chair and invited them to sit.
She walked down the length of the couch and sat lightly at the end, scrunching her legs up beneath her. He went to the other end of the couch and sat down heavily there. They could not have been farther apart unless one of them sat on the floor. “Ooh,” I thought, “financial advising is going to be interesting!”
They were the kind of mixed-styles marriage that advisers see all the time, though I didn’t know then how normal this was. Jennifer came from a moderately wealthy midwestern family. She was an artist with some successful sales and some part-time teaching but was more interested in creativity than in commercialization. Paul was a tech guy who loved the challenge and novelty of his work and, much like his wife, would have been happy doing what he was doing even if he didn’t get paid for it.
They seemed to respect and appreciate the other’s work, but both seemed unhappy with the way their daily lives were unfolding. They went back and forth. Jennifer felt cramped living and working in their small Boston condo and wanted to move back home near her family, where they could have more space more cheaply. Paul didn’t think he couldn’t find fulfilling tech work where her family lived.
She thought at least they should buy a bigger place in Boston. He thought they couldn’t afford it. She thought he should get another job that paid more money. He didn’t think that was possible, and anyway he was happy with his job and thought she should earn more money herself.
They presented all this to me as a set of financial problems. Were they making enough money? Did they need more? Could they afford to stay in Boston? Finances were certainly part of the issue but obviously there was more involved than just money.
Clearly, they had had this same back-and-forth conversation endlessly on their own and now were just repeating their lines for me, each hoping that I would tell them they were right. It was equally clear that I couldn’t take sides and couldn’t resolve these issues for them. In fact, my first thought was that they might need a marriage counsellor rather than a financial adviser.
Experienced financial advisers will be familiar with this kind of infinite loop: Clients come in with a problem that is actually a bundle of issues, only partly financial, that they haven’t been able to sort through to make progress toward resolution, so they keep churning through the same basic points.
[More: Emotions are information]
I needed a way to break the round-and-round circle they were stuck in. I realized they were operating at a high level of abstraction — thinking about the possibilities theoretically. “You could make more money.” “I don’t think I can.” I needed a way to make things more concrete, to pin down at least some of the variables so they could focus on actual decision-making.
I decided to put them to work. I gave them each homework gathering concrete data that would support (or contradict) their beliefs. She was to look into housing costs near her family and price some larger condos in the Boston area. He was to look locally to see if there were higher-paying opportunities and find out what companies near her family might potentially have good jobs for him. She would also see what she could earn by expanding her teaching.
I expected I would never see them again. After all, I hadn't resolved their problem and instead had sent them away with work to do. To my surprise, they came back about a month later. And to my amazement, they had each done their assignments. Paul had looked at job options in the two locations and had a sense of salary ranges. Jennifer had checked prices for housing she would be happy with in both places.
They had even taken the next step of assessing some of these options. “Maybe we could stay here and do these jobs. Or what if we moved and did this for work instead.” Now the actually had something for financial analysis, where we could put together the numbers and see how the situations compared financially. I couldn’t tell them what to do, but they were past their stuck point and on their way to making some decisions.
In the end, they came up with a plan that would not have occurred to me. They had realized they liked aspects of both options and didn’t want either spouse to have to compromise everything. Since Paul’s work opportunities were better in Boston, they decided to keep that as their base, staying where they were, but renting a second place, larger and much cheaper, near Jennifer’s family so she could spend more time there and have a bigger studio.
Lesson learned: Even if you can’t solve clients’ problems, you might be able to guide them toward finding solutions themselves.
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.
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