I’m fascinated by how the brain works. How it helps us process information, make critical decisions, avoid problems, be outgoing or creative, and engage with others. As many of you know, these various functions stem from different sides of the brain and have resulted in a centuries long suggestion that people have right-brain or left-brain tendencies. Inclinations or personality traits that cause us to act and think a certain way based on ones more dominant hemisphere of the brain.
So-called left brained people are described as being logical, analytical, and detail-oriented. They tend to be objective and factual, so they are good at math, engineering and other fact-based tasks and careers. Right brained people are considered creative, perceptive, intuitive, and freethinkers. Their perspective and approach are more subjective and expressive, so they’re associated with creative tasks and careers.
All very interesting information, but it’s simply not true. The right brain/left brain concept is myth rooted in old and outdated information. What research actually proves is that different sides of the brain are responsible for different tasks, we use both sides equally, meaning logic and creativity are not separate or exclusive.
This myth busting reality is valuable for the financial services industry because for decades we have allowed a similar type-split to dominate our industry. For decades we have been trained to believe that the financial side is more dominant and valuable. That it’s the primary engine to a successful life after work. But nothing could be further from the truth and it’s time to not only level the playing field but also prepare advisors for the major industry changes coming as a result.
This “need” for the two different sides to work together highlights one of the biggest voids in traditional retirement planning. The fact that there is no universal definition of a successful retirement. Take a moment to process that. There is no single bast way to define a successful retirement.
Now many people will say, a good or strong retirement is one that has a financial plan, ample savings, the right asset allocation, safe withdrawal rate, essential estate planning documents, and the right insurance coverages. Which logic suggests is a good start. But quite frankly, if you have all that right financial pieces but are unhealthy, alone and watching TV all day, or turn to alcohol or other drugs to deal with problems, intuition suggests that retirement won’t feel good or be very meaningful. Which is why is so important for professionals as well as industry firms to realize the hard side needs the soft side and the soft side needs the hard side.
One way for advisors to see how this blending can work is to take a stereotypical couple where one spouse has a penchant for the dollars and cents and the other prefers to focus on filling the social calendar, keeping family close, and getting out and experiencing new and different things.
On paper, this sounds like a perfect match where each spouse helps balance the other out. That is until they meet with their advisor. The issue at hand is that the spouse who’s focused on the money tends to be considered more important, valuable or dominant in these meetings because that’s what financial advisors have been taught to focus on. The more personal side has received little to no discussion and doesn’t come with a process to develop a concrete written plan for how they will replace their work identities, fill their time, stay relevant and connected, as well as keep mentally and physically active.
That’s been left for clients to figure out on their own and one of the reasons I feel gray divorce will continue to climb and while more and more people will fail as they make the transition from work life to home life. It’s a void that professionals can no longer avoid or put on the back burner simply because you’re going to start losing clients over it.
I recently had a couple who moved their money from a large well-known firm where multiple family members held money and they were receiving a discounted asset management rate as a result. They did it for one simple reason, the spouse who leaned more towards the non-financial factors didn’t like how the advisor made her feel and she often felt left out of the conversation.
In a similar case, I had a widow leave a long-time advisor her deceased husband had used for decades before his passing. She left because in her words, “He only wanted to talk about money.”