Offer Planning vs. a Plan

“Plans are useful in the sense that they're proof that planning has taken place. The planning process forces people to think through the right issues.” ― Chip Heath

Financial Planning
 Min read
January 2, 2023

In working with clients and advisors there is a very powerful distinction that I have observed when it comes to running a fee based financial planning practice.

There is a big difference between offering planning and offering a plan.

Most advisors that are trying to create a fee based financial planning practice put all of the emphasis of the value of their offer on “The Plan”.  This is reinforced by the compliance requirements associated with doing fee based financial planning.

You must produce a plan as proof that you satisfied the conditions of the contract you had the client sign. And, as a result, all of the advisor’s language when they are making an offer to their client, is typically along the lines of labor,

“We are going to do a financial plan for you.” The fee they charge is a result of the labor/hours that go into creating A PLAN.  

The next year, when the advisor is contemplating trying to charge another annual planning fee, they think to themselves, “But we just did the plan last year.” “Is the client going to pay me another fee to simply update the plan?”  

This is also seen when a potential client or existing client asks, “What do I get for the fee?”  The typical answer the advisor gives is rooted in the labor they will provide and the document they will produce.  

They say, “Well we are going to spend X hours creating a plan and we are going to set you up with an E-Money website and we are going to mow your lawn.”  Let me offer some language that will help you distinguish the offer of planning from providing a plan.  

You are like a doctor that has spent years learning financial anatomy. Once you understand where someone is relative to the key areas of life (income, assets, heirs), you can engage in planning.  

Helping give them the context they need that is most relevant to their story; to see, think and move more powerfully.  Also, when it comes to planning fee renewals you have a far more powerful offer than if you offer a plan.  

Planning is an activity you engage in regardless if you change anything.

When you go to the doctor for a physical, he goes through a process that allows you to observe your health alongside of the expertise of the doctor. Sometimes he tells you to keep doing what your doing and sometimes he offers a change in your plan for optimal health.

The value is in the observation and conversation rooted in your story. The major difference between great success and mediocrity in this domain is the offer of planning or the offer of a plan.  

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