All Things Financial Planning Blog

Mutual Accountability

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Business CoachWe talk a lot at the financial planning firm I work for about mutual accountability. In fact, it is part of our vision statement. What it means to us is that there are responsibilities for both the advisor and client in maintaining a healthy relationship designed to successfully meet our clients’ goals.

For advisors, that means being diligent and putting together sound advice and plans that serve the best interest of the clients and families we gratefully spend our careers serving.

But, we must also expect clients to be accountable for carrying out those plans and letting us know when goals or situations are in flux. Without proper execution, the advice we offer will never amount to much. Despite what many think, long term success occurs less in the swings of the stock market and more in the mundane financial decisions we make every day.

So what happens when we deviate from those plans?

See if this analogy hits close to home. You’re making an ongoing effort to eat less. Maybe you’ve consulted with a dietician, attended a Weight Watchers meeting or sought advice on the Internet. You put a plan together designed to meet your goals. Then, one night you decide to splurge. It might be a trip to the fridge for an extra bite of leftovers or a quick cookie in the pantry.

Do you own up that you’re making a conscious choice to go off plan? Or, do you “sneak” the quick indulgence? Hide it from a spouse or your children? Claim ignorance at your next meeting as to why the pounds aren’t melting away?

Have you ever thought about why?

It’s ridiculous, really. That cookie isn’t adding calories to anyone else’s diet. It isn’t breaking their rules. The person you’re really hiding from is yourself. You’re avoiding accountability.

Are these types of indulgences the end of the world? It depends. Does one cookie become a whole sleeve? Does twice a month become a nightly ritual? How badly are you willing to sabotage your long term goals for short term enjoyment?

The same is true with our personal finances. We all have places we turn for financial planning and advice. Financial planners, investment managers, and sources like this blog or other Internet resources can be full of valuable, insightful information. Either way, we might receive some useful advice or read a particularly relevant article and decide to commit to making a change in our financial lives, just like with our diets.

What happens next is crucial. Do we carry it out? Do we save a little more? Spend a little less? Or do we quickly find ourselves back at square one after too many instances of whatever the financial equivalent is to an extra bite of cheesecake when no one’s looking?

Unfortunately, like our waistlines, accountability will eventually rear its ugly head. We can spend that extra dollar when no one’s looking and cheat our responsibility to our future selves all we like. In the end, we will have no one else to answer to when important goals go unmet. No one has the kind of stake in your future that you do.

There are wonderful advisors and tools out there to help you build a path to meet your lifetime goals, but the path is really all they can show you. The decision to walk down the path is yours. Sure, you’re going to stray from time to time, just don’t get so far off course that you can’t find your way back. Keeping those diversions to a minimum and letting your trusted sources know when they occur will help ensure the needed corrections will be relatively minor.

Chip Workman, CFP®, MBA
Lead Advisor
The Asset Advisory Group
Cincinnati, OH

Author: Chip Workman, CFP®

Chip Workman, CFP®, MBA is a Lead Advisor for The Asset Advisory Group in Cincinnati, Ohio. The Asset Advisory Group is an independent, fee-only RIA whose mission is to provide for their clients’ financial and emotional security through comprehensive financial planning and disciplined investment management. In addition to his work with clients, Chip writes for the firm’s blog at http://taaginc.blogspot.com, volunteers for various financial literacy programs and is actively involved with CISV, an international peace education organization where Chip sits on the National Board, chairs the Finance Committee and serves as the local chapter’s Treasurer. He is also a member of the Financial Planning Association and their NexGen community of young financial advisors. Prior to joining the firm, Chip spent his career as a Private Banking and Trust Officer, advising high net worth clients on a variety of personal financial issues. Chip completed his undergraduate studies at Miami University in Oxford, OH and his MBA in Finance at Xavier University, where he now serves as an Executive Mentor for undergraduates.

One thought on “Mutual Accountability

  1. Hi Chip,

    I am considering giving this more weight in my client relationships. Can you talk a little bit about how you introduce your clients to this concept? When do they first hear the term? Do you talk about it in the first meeting? Is the term used in the Client Service Agreement, or in your website?

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