Cure the Disease or Treat the Symptoms? – Part 1

There are many similarities between physical and financial health. As financial advisors, we often are confronted with the same dilemma that physicians face; cure the disease, or treat the symptoms? In Part 1, we will look at curing the disease, and in part 2, we will discuss treating the symptoms.

In a perfect world, we would primarily see clients with good saving/investment habits; a reasonable understanding of risk/return and control of their spending. Many times, however, our advice is sought by investors who have poor saving/investing habits; an unrealistic view of risk/return and little control of spending.

Moving individuals towards financial independence (where your money lasts a lifetime), requires 3 ingredients: time, saving, and discipline. Each of these components depends upon the other and the “disease” cannot be cured without the presence of all three.



Time is often needed to reverse the impact of previous financial mistakes and establish good saving/investing habits. The amount of time required varies, depending on the savings gap, the difference between what you currently have and what you need. One reason we encourage younger individuals to retain our services is that time is on their side.



In order to accumulate capital for future needs, saving some of today’s income is obviously necessary. Curing the disease means understanding that investment returns are important, but the amount of your savings is even more critical. As with the element of time, the amount of saving will vary depending on the gap between what current savings are and what is needed for financial independence. Regardless of income, individuals who don’t save face a perilous financial future.



Discipline or willingness to stay with the established financial plan, in good and bad times, is perhaps the most difficult element needed for the cure. Particularly in our electronically connected world, the ability to filter out day-to-day noise requires a high level of emotional intelligence. Research demonstrates that investors who simply stay invested (instead of coming in and out of the market) significantly outperform.

The primary “disease” we see is the lack of enough money to keep pace with living cost increases over a post retirement lifetime. With time, saving and discipline, the disease can be cured. Ready for a real conversation?


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