Financial Planning: A Stepping Stone To Your Highest Self
We all aspire to be the greatest version of ourselves that we can be, to reach our highest potential. We want to have loving relationships with family and friends, a meaningful career that we’re good at and love doing, a purpose that allows us to give back to the world, live a life we’re engaged in, and the freedom to go where we want when we want. While achieving these goals is not easy or straightforward, having such a life is absolutely within our grasp. Loving relationships, meaning, freedom… little else fulfills and inspires us like these do.
So how do we achieve such an idyllic state?
First, we must understand what motivates us as human beings. The best depiction I can share on this is “Maslow’s Hierarchy of Needs “.
What is Maslow’s Hierarchy of Human Needs?
Maslow’s Hierarchy of Human Needs (left) was first introduced by the famous American Psychologist Andrew Maslow in 1943. This popular diagram is an incredible way to understand which specific needs most powerfully motivate us as human beings, our brains are literally wired this way, you can’t fight it. The bottom layer comprises our most vital survival needs and each layer above it is increasingly less vital to basic survival (& therefore less subconsciously motivating). While the upper levels are less vital to survival, they are wildly important to us in living a fulfilling & meaningful life. The challenge is that it’s difficult for our brains to clearly focus on the higher levels if our more pressing basic needs in the lower levels are going unmet.
Hard to focus on achieving your highest potential (largely focused on others) when you’re not even sure how you plan to pay off your own debt, invest your own money, and ensure you have your own basic needs met so you (and your family) feel personal security now and in the future. Your brain is wired to ensure these personal needs are met first. So while most of us do a pretty good job of making sure we have a roof over our head, our motivation fades somewhere after these basic needs are met. Screaming kids, demanding job, desire to rest, putting our higher level needs first after these basic needs are met can be TOUGH. Why? Because the higher the pyramid level, the more conscious mental effort it takes to motivate us since our “lizard brain” isn’t lifting the weight anymore. We have a finite amount of conscious mental energy each day for decision making and often that mental energy is drained by lower level needs before we even start to focus on higher level needs.
So what does this have to do with Financial Planning?
In short, a lot. You see the bottom 2 most vital layers? They all in some way, shape, or form, require or revolve around money. To your brain, these are priority #1 and focusing on anything else while these go unmet is very difficult. So your money is not just a necessity to live, stressing about it can create a mental wall that holds you back from becoming “a better you” if not used appropriately. Funny how money can be the wind beneath your sails or the anchor holding you back, it’s all how you use it!
Let’s say hypothetically you’re one of the lucky few who doesn’t stress about money, you pay your bills and you feel secure in the bottom 2 layers. Are you still making the most efficient use of your money so that it supports you becoming the highest version of yourself? (i.e. Maslow’s top 3 layers). Examples include: Taking a year off to travel the world (freedom), quit our unfulfilling job to start our dream business or get involved with charity (self actualization), take time off to be with family/loved ones (love & belonging), the list goes on and on.
“So, money matters, very insightful Jonathan!”. An obvious statement, I agree, so why don’t people invest more time, effort, or intention into managing their finances? They already put in insane amounts of time into earning what they have, why not go the extra mile to make sure it’s being used wisely? Think about it, our human needs are what’s at stake here, not just to pay rent but to live out dreams. By not putting intentional effort into your finances you’re jeopardizing multiple levels of your human needs.
Good points, but is working with a Financial Planner really the solution?
I’ll tell you what a Financial Planner can do and what they can’t do.
What a Financial Planner can’t do:
Be your therapist (however, a planner is a place to discuss barriers around money and that often includes emotions).
Provide you the self awareness needed to reach your highest potential or communicate your needs clearly.
Make life & financial decisions for you.
Carry out most of their recommendations for you (it’s a collaborative effort).
What a Financial Planner can do:
Secure Your Bottom 2 Layers: By helping secure your finances (bottom 2 layers - basic needs), a financial planner frees up your finite mental energy to better focus on your upper 3 layers (a rich and fulfilling life). A good planner should help free up your time and mental energy to focus on what you do best.
Explore Your Top 3 Layers: A good financial planner creates a space to explore you more deeply by asking powerful questions designed to understand who you are, what you value, and where you want to go in life. If you can communicate a life vision that inspires you, a financial planner can help you make the money moves to get there.
Make Tough Decisions Easier: A financial planner makes tough decisions easier (preserving more finite mental energy). A planner provides clarity with tough financial decisions around what your options are and how each one will impact you now and in the future. This clarity empowers you to make the best decision you can based on your values and life goals, so you move forward with peace of mind. When making decisions. stress can actually make you dumber and less fit to make decisions (see “Objective” bullet below for more on this).
Objective: Money can be stressful. Stress releases cortisol. When we’re stressed studies have shown our IQ literally drops and we’re less fit to make decisions. A financial planner is not emotional about your money like you are. As such, a financial planner can keep calm in moments of panic, make decisions more pragmatically, and even raise awareness to certain patterns you may not be seeing or taking ownership of. From there, the adviser can recommend practical courses of action based on your values (after having gotten to know you more deeply), not strong emotional bias.
A Teammate: How often in life do you get a truly objective teammate (not your spouse) to sit with you, put your life first and in full focus, with the sole intent on helping you move closer to your life vision? Often, people have never taken the time to explore themselves in the way a good financial planner will. A teammate that will make your financial needs their priority when life (kids, career, etc) makes it hard to do so yourself.
Accountability: To help you keep your eye on the prize and take consistent committed action towards bringing your goals to life.
Perspective: Help you overcome inevitable fears that can derail you from achieving your goals so you keep moving forward.
Risk Taking: A Financial Planner helps you weigh which risks make sense. By putting risk in perspective, it keeps unfounded fears from holding you back from risks that might be necessary to achieve the things that matter most to you. Conversely, a financial planner should also help you avoid certain risks, or excessive risk, that would unnecessarily jeopardize what matters most to you.
Financial planning is so much more than numbers, it’s about increasing well being within humans, humans that are driven by emotions, emotions that exist to ensure our human needs are met. Money is a tool to help you meet your inner most needs and desires. Financial Planning can help solidify your bottom 2 layers (Maslow’s pyramid), so that it becomes a stepping stone for reaching your highest self (the top 3 layers).
** Personal Note: Hi, I’m Jonathan, the author of this post. Read below as I share what “living for your top 3 layers” looks like for me. **
Travel Tip: The Amazon Jungle
Want to see the Amazon jungle in one of it’s most settings, surrounded by minimal human presence, maximum wildlife, and for a fraction of what the over trafficked touristy areas charge? Consider visiting the small town of Lagunas, Peru, not the heavily trafficked city of Iquitos. In 2017, my Father and I spent a week in a wooden canoe with 2 personal guides just for us! In addition to the guides hand spearing fish daily from the boat and cooking them for us at almost every meal we had, the guides literally hand paddled us the entire way there while we took photos and absorbed the jungle around us. At night, we camped in tents underneath thatched roof huts, listening to an epic chorus of exotic wildlife, and I mean a lot of wildlife. The guides only spoke Spanish so it was a great immersion opportunity (don’t worry, translation apps can be downloaded so you can even use them off grid!). We saw a baby sloth, baby Cayman, baby Anaconda, a 6 foot electric eel, loads of incredibly colored butterflies, ate piranha, floated amongst 3 foot wide lily pads, only got eaten by mosquitoes one night, and most importantly have special memories to share for a lifetime!
The cost? $350 USD per person for an “adventurer’s all inclusive” 1 week trip into the Amazon jungle. I covered my Dad’s bill and it’s probably the best gift I’ve ever given him. While this trip may not be ideal for more comfort focused travelers, or those in a time crunch (it requires 2 flights and a river ferry), if you love nature and adventure this trip should be near the top of your bucket list!
San Diego Financial Advisor | Fee-only Fiduciary
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