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Planning Your Life of Freedom: Traditional Financial Planning vs. Financial Life Planning

The big day has finally come! After years of progressing from apartment living, to renting a house, to buying a 3 bedroom “starter home,” you are finally ready to design and build the home of your dreams! You did your research and found two architects to interview, Bob’s Builders and Chuck’s Custom Homes. They both build well-made homes and advertise as custom home builders.

You and your spouse decide to start by calling Bob’s Builders. Bob, the architect, answers the phone and you exchange perfunctory greetings.

“So, I understand you want to build a dream home. Your survey answers said you were looking for a two story, 4 bed, 3 bath house. Is that correct?”


“Great, I know just the plan for you! Here at Bob’s Builders we have our own proprietary method of laying brick that is 5% more efficient than traditional methods…”

For 30 minutes, Bob gives you a run-down on the varies tools, materials and special building techniques that make his company different from other builders.

Next, you call Chuck’s Custom Homes. Chuck greets you and asks, “So, what was the reason for your call today?”

“We would like to build our dream home. We think we would like a two story,  4 bedroom, 3 bath house.”

“Oh, great! Tell me more.”

Your spouse chimes in, “We have two young children, and would like them to each have their own rooms. We would also like to have a spare room for when my parents come to visit. Sometimes I work from home, so having an office would be nice.”

“We will put that in the plan then. Anything else?”

The conversation goes for two hours while you explain all the things you want in the house. Chuck listens intently, assuring you it can all be incorporated into the design of the house. At the end of the meeting, after you have covered everything that is important to you in a home, Chuck says “I am really excited to take all of your ideas and put together a rough proposal, and then we will refine it to fit you.”

When you hang up the phone, your spouse turns to you and asks, “So, who should we hire? Bob or Chuck?”

Who Would You Choose?

Who would you pick to design your dream home? Bob, who went into great detail explaining the quality of the tools and techniques he uses in building houses? The builder whose design for your house will be based on a quick survey? Or Chuck, who took the time to understand your vision and needs for your dream home? The designer who wants to make sure the home provides a space for the life you hope to live in it?

Even though both architects build excellent houses, I suspect we would all choose Chuck to design a home that is unique to us. So, what does that have to do with financial planning?

Traditional Financial Planning

Traditional financial advisory firms (like Bob’s Builders) are solutions-based. In the early days, those solutions revolved around product (insurance or investment products like mutual funds) for which they received a commission. Today, there are more financial planners, both fee-only and fee-based (meaning they receive fees from clients as well as commissions from products) with a lot of technical financial know-how and all sorts of solutions for different financial situations. A Certified Financial Planner, the premier designation in terms of personal financial knowledge, covers technical topics ranging from investments and risk management, to income tax and estate planning. Understanding these topics are critical for building a solid financial house for clients. However, it wasn’t until March 2021 that the CFP Board expanded into topics around understanding the client as a person.

Traditional Financial Planning focuses on the money side of personal finance.

In the evolution of Financial Planning, financial product sales people were the beta version of financial planners (there wasn’t much real planning going on back then). Financial planners utilizing in-depth understanding of personal finance to provide clients with guidance and recommendations around managing their money are Financial Planners 1.0. Financial Life Planning represents the next evolution into Financial Planners 2.0.

Financial Life Planning

A Financial Life Planner takes the technical expertise in personal finance and adds a methodology for deeper understanding of a client’s needs through Life Planning (like Chuck’s Custom Homes). George Kinder, CFP® developed the EVOKETM Life Planning Process back in the 1990s as a method for better understanding a client’s needs. The objective of life planning is to help clients create a vision of their most fulfilling life and then utilize the personal finance skills of a financial planner to deliver them a life of freedom.

Life Planning centers on your Dream of Freedom

Bob and Chuck both built great homes using top grade products and techniques. The difference that elevated Chuck was his approach to really understanding the clients’ needs, and then designing the plans around them, where Bob just took a general idea from some very basic questions and then imposed his pre-conceived ideas into the design. Both built nice houses, but Chuck’s are truly custom. When it comes to your personal finances, don’t you deserve a custom plan designed to deliver your vision for a life of freedom?

How On Point FP Can Help

At On Point FP, I was trained in Life Planning through the Kinder Institute of Life Planning and use the EVOKETM Life Planning Process. Once we have developed your vision, I apply my knowledge and experience in financial planning to deliver a plan to achieve your goals so you can live your most fulfilling life.

If you would like to learn more about the process I use, and get started on your life plan, visit On Point FP’s Financial Life Planning page.