by Susan Zimmerman, ChFC, CLU, LMFT
More frightening than “lions, and tigers, and bears, oh my!” can be those significant life transitions of our clients’ young adult children. These are examples of the life events that are traditionally defined as positive occasions – events to announce to the world and celebrate. When children graduate from high school or college, get married, and begin to have families of their own, it is an exciting time. Yet just below the surface can lurk some challenging relationship and financial dilemmas that can create an overload of stress.
As with other financial planning issues, significant life transitions may have some unconscious or conscious expectations about how things “should” be. Often, the financial elements may not been addressed and a lack of preparedness puts an unexpected dent in cash flow or savings security. The change in relationship roles can also put a dent in clients’ emotional security as they navigate through the new terrain of life stages.
Let’s take the social and family pressures of wedding planning as an example. Traditional financial planning may set up funds for college, but wedding savings may not be discussed at all. Some sources say the average wedding in America
And speaking of pleasing everyone, it doesn’t hurt to tell a story or two about the potential list of hurt feelings that inevitably happens when someone’s role in a wedding isn’t what they had hoped or expected. In today’s world of blended families, just figuring out what to do with all the “extra” parents can be difficult at best. A loving, long time step-father, for example, who was the primary financial, emotional, and physical support of his step-daughter is asked to do a reading at the wedding but not walk the bride down the aisle. The formerly absent biological father has come back onto the scene just in time for the bride to feel obligated to have him walk her down the aisle, and she complies. Step dad and mom are paying for the wedding, but silently and graciously step aside so the bride can have maximum harmony on her special day. There are many variations of hurt feelings that arise in planning, and an advisor can listen for these disappointments and provide encouragement.
Grandparents are another example of role shifts, and may find themselves in one frequent costly emotional shopping spree after another. Or clients’ children may not have been ready for the extra financial demands of providing for a child, and the grandparents feel obligated to support the new family with gifts of money that may equal or exceed their own mortgage payment.
Whether it is graduations, births, weddings, or other typically happy occasions that dip into clients’ savings or cash flow, it pays to bring up these joyful potential expenditures in planning before they arise. Point out the emotional tug that happens, of feeling an obligation to provide financial support, and help clients establish some of their gift-giving boundaries before they sabotage their own financial future.
As with any other goal, life’s celebratory events can cost a pretty penny. Help your clients anticipate them, and recognize some reasonable boundaries ahead of time while putting some money in place to enjoy them. It is part of the “regret prevention” plan of your client services – you help them resist sabotaging their future financial security by anticipating and preparing for the emotional and financial needs that come with life passages. The reward is greater harmony in your clients’ financial and family relationships, and their gratitude and loyalty for your wise counsel.