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The Importance of a Good Financial Partner

What do marriage, death, divorce, moving, major illnesses, job loss, buying and selling a home, and having a baby all have in common?

It probably gave you a little anxiety just reading that list. These are among life’s most stressful times–even though some are among the happiest as well. What you don’t necessarily think about—or have time to think about—is how they are also impacting decisions about money. But, for most, money is not the primary factor in the decision-making process in life, nor do we believe it should be. As you think through life’s choices though, money is a common underpinning of almost every major event and decision you make. If you ignore its impact, it can add stress today and tomorrow, impacting both you and your money in ways you can’t quite foresee.

Just as we each have our own unique route around life’s sign-posts, I can give you a window into my experience with a former client who, although finding her way to success, also had to carve a route that fit her own needs and desires.

When I met Colleen (not her real name), she was single and a young entrepreneur. In her early 30’s, having built her own business, Colleen’s business was growing fast. In fact, her revenue was at around $2 million annually when we began working together. Colleen was “stressed” when we met–not certain she was making the right financial decisions for her future and considering the growth of her business. As her Financial Advisor, I watched Colleen’s business grow and her lifestyle change significantly with that growth. Before she knew it, she had gone from the $2 million in revenue and 2 employees to a total of $25 million in revenue, a larger office space and warehouse to accommodate her business growth as well as nearly 25 employees.

Along the way, as Colleen’s business grew, I was there listening, helping her to establish a level of comfort with the decisions she was making for both her peace of mind today and her understanding of the impacts those decisions might have on her future. She was diligent about keeping her nest-egg growing and her business financials separate. She did well, and I talked with her through many a decision-making process on whether to borrow for her business growth or tap into her personal money.

One day, I walked into Colleen’s office for a regular meeting to review her portfolio and talk about how things were going. We typically talked about her personal and her business life. In our past several meetings, I had noted that Colleen was a bit more “stressed” and had shown some signs of fatigue that were fairly new. When I asked Colleen if she was happy with her success, Colleen opened up to share how tired she really was and how she felt that life was passing her by. She confided that now that she had “arrived” professionally and financially in a place where she had always dreamed, she felt she was missing out on life. Her business had grown so much that she was managing the business and her staff, and had less and less contact with what she loved most…the artistic side of her business and the relationships of her most valued customers. She also felt as though she was missing the opportunity for a personal life. One that might include dating, marriage, kids, and more. Colleen had been so focused on building her business that once she arrived where she thought she wanted to be, she no longer wanted to be there.

During that meeting, we discussed her options, one of which was to shift her gear to reverse, and that’s what she did. She slowly but patiently made the decision as to which clients she would continue to work with on her own with just 1 or 2 employees, and found new homes for the rest. She was as successful “downsizing” her business as she was in the growth of her business.

Soon after Colleen made the shift back to a smaller business, she happened upon the man she would soon marry, moved to the suburbs and started the life she had been concerned she was missing. Along with her marriage came 2 kids from her new husband’s previous marriage, a new home with several acres for horses (a newfound hobby of Colleen’s) and lots of financial decisions. Even though she now had a significant person in her life to share the “money” decisions, neither she nor her new husband had a true understanding of the impacts of those decisions. For example, how buying that new acreage and home would impact their future “retirement” or “next phase.” Also, Colleen now happily had 2 daughters from her husband’s previous marriage. Colleen was ecstatic about the girls and adored them and wanted to make sure their future was provided for as well. Each of these “life choices” needed to be integrated with their future plan. And that future plan was now new to Colleen and her husband. Having several conversations with the two of them, talking through options, calculations and outcomes, they came to decisions with a good understanding of how those decisions today would affect their financial future and carved out a “living plan” and path toward their goals.

While most people don’t create and grow a business only to then shrink it back to size, Colleen is very much like most people in many ways. Think about it…did you begin your adult life in a particular career or job? Did what you were doing change either because you made a decision for change or your employer did? Did you get married and have kids? Have you been divorced? Did you buy a home? Build a business? Have a death in your family that impacted you both emotionally and financially? All of the choices you make in life as well as the cards life deals you, like Colleen, impact both your money and your personal well-being as well as those around you.

We think integrating “life’s choices” with your financial decisions is the most important way you can live your life. Why? So that you may live a less stressed, as well as financially sustainable and therefore healthful lifestyle. Your financial advisor of today should consider much much more than just your money. Your financial advisor today should be your collaborator–your partner–alongside you, facilitating the integration of your life choices with your financial life every step of the way.