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Episode Summary
Money decisions are never just about money.
Research tells us that about 90% of all financial decisions are made emotionally, not logically.
Decisions driven by our mind rather than our money.
And that’s why every financial behavior, even if it appears illogical, makes perfect sense once you understand the underlying beliefs, feelings, and thoughts that accompanied the decision.
Maybe it’s the client who inherited $5 million three years ago and have yet to touch the money despite you showing them how it will instantly accomplish all of their financial goals.
On the surface, this seems illogical (and borderline crazy!).
Surely this was a positive life-changing event for this client?
Use this money to instantly accomplish all of your financial goals…
But, again, money decisions are never just about the money.
And, in this situation, you learn that what appeared illogical/crazy on the surface makes total sense once you uncover the underlying beliefs behind the decision.
She hasn’t touched the money because she had learned in her childhood that money corrupts. Especially money that you didn’t earn…
All at once, she feels afraid of what the money will do to her and doesn’t feel worthy of accepting it.
So, of course, she didn’t want to touch the money!
These beliefs, feelings and thoughts form your money mindset. Every current and future client you work with is programmed with their own money mindset driving all of their decisions.
And, oftentimes, the gap standing between where your client is and where they want to be is forged by their money mindset.
Fortunately, Rick Kahler is one of the pioneers in this space and shares from his own experience working with clients the latest tools and research to help you discover and change your client’s money mindset.
Things You’ll Learn
- The importance of accepting there is no such thing as an illogical behavior
- Three exercises he uses with clients to explore money beliefs: Money Egg, Money Atom, and Money Scripts
- How asking questions kills conversational flow (and an alternative to asking questions)
- How he learned to embrace silence and be a better listener
- Why he doesn’t explore past beliefs with every client and how he decides when to do it
- Why every advisor should do their own “work” first to best serve their clients
About Rick Kahler, MS, CFP®, CFT-I™, CeFT®
Rick Kahler, MS, CFP®, CFT-I™, CeFT® is a pioneer in integrating financial planning and psychology. Rick is one of the pioneers of financial therapy and recognized for his pioneering work in that field by InvestmentNews in 2019 with their annual Innovator Award and in 2018 by the Insiders Forum with their annual Iconoclast award. He is a founding board member and Past-Chair of the Financial Therapy Association.
He’s been cited in scores of periodicals, including ABC News, NBC, CNBC, Fox Business, The WSJ, The Times of London, and The New York Times. He is in his 31st year of writing a weekly column on personal finance published in several newspapers, produces a weekly podcast, “Financial Therapy-It’s not just about the money,” and is a co-author of five books including Facilitating Financial Health and The Psychology of Financial Planning.
Other Episodes You’ll Like On Psychology, Money, and Behavior
- The Psychology of Decision-Making in Financial Planning with Hal Hershfield
- The Psychology of Referrals with Dan Allison
- The Advisor’s Guide to Money and Behavior with Dr. Brad Klontz
Resources
Financial Awakenings Blog by Rick Kahler
The Psychology of Financial Planning by Certified Financial Planner Board of Standards
Internal Family Systems Therapy by Richard C. Schwartz and Martha Sweezy
The Last Lecture by Randy Pausch
“12 Roadblocks To Communication” by Thomas Gordon
Whenever you’re ready, there are 3 ways I can help you master the human side of advice:
- HSOA Masterclass: An 8-week group program on building trust & connection, aligning money and life, and delivering frictionless advice.
- The Ultimate Discovery Meeting: A proven framework to seamlessly convert prospects into life-long clients in one meeting.
- HSOA Community (COMING SOON!): An online space to meet, collaborate, discuss, brainstorm, learn and grow with other advisors passionate about the human side of advice
If you’re interested, let me know here.