How advisors can bust their clients’ money myths.
Updated: Oct 9
Original article by:
Barbara Balfour
THE GLOBE & MAIL
March 6, 2023
📰 Read the FULL ARTICLE here.
I spoke with The Globe and Mail about how advisors can help clients see past their money myths. Here are the highlights and my contributions.
Key Takeaways
The right money mindset matters as much as the numbers, and people's perceptions often don't match their real financial picture.
Renting isn't automatically a waste of money; the right choice depends on local housing, costs and how long you plan to stay.
Not all debt is bad. Borrowing for an asset that grows or earns income can be a sound business decision.
You don't need a large sum to start saving or investing, since compounding works even on small amounts.
Keeping everything in a savings account has its own risk, because inflation erodes your purchasing power.
My Perspective
Many money beliefs come from how we grew up. Even someone with a six-figure salary, healthy savings and no debt can feel guilt and shame and behave as though money is scarce.
"A lot of this stems from how they grew up and their experiences with money around family and friends."
The opposite happens too. I've seen clients with limited means spend freely to keep up appearances, and social media makes that even easier.
"Having conversations that get to the root of why clients engage in certain money behaviours is an important step to holistic planning."
The key is to avoid judgment. I also break my advice into small, bite-sized steps so clients don't feel overwhelmed and understand the reasoning behind each one.
"If the client understands why you're giving the advice, and how it will allow them to achieve their goals, they are much more likely to execute the plan successfully."
Originally published in The Globe and Mail by Barbara Balfour on March 6, 2023. Use the link at the top of this post to read the full article.
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