“What do you do for a living?”
That’s a pretty common question when we’re introduced to somebody new. If I answer it with, “I’m a financial advisor,” there usually isn’t a lot of follow-up conversation. Maybe that means people assume I’ll start talking about the nuts and bolts of investing and diversification and asset allocation—not necessarily topics the average person finds all that fascinating.
If I answer with, “I’m a financial therapist,” I usually get a puzzled look and a response of, “What’s that? I’ve never heard of a financial therapist.” I go on to explain that financial therapy blends the nuts and bolts of financial planning with the emotions of money, and that most financial planners don’t deal with emotions and most therapists don’t deal with money. This answer generally makes sense to people.
Another way to describe what I do is just to say, “I’m in the wellness business.”
Wellness or wellbeing has a lot of definitions. The Oxford English dictionary says it’s the state of being comfortable, healthy, or happy. Now, when we drill down, what makes us comfortable? What makes us healthy or happy? What does that take? Many professionals agree that there are three general components of wellbeing: emotional/spiritual, financial, and physical. Others separate emotional and spiritual, defining four components of wellbeing. Even though we don’t do much to address the physical side, the profession of financial therapy comes closer to being in the wellness business than almost any other profession.
This is why I got excited about 18 months ago when I read an article in HotelsMag.com about a Global Wellness Summit held in November 2020. Participants in a panel discussion made several predictions about wellness trends. One of the trends they saw was a greater holistic emphasis on preventative healthcare with a greater focus on food supplements, immune therapies, and education. As a supporter of holistic medicine and prevention, I’d be delighted to see that trend continue.
Another trend the panel predicted was an awareness of the healing effects of being out in nature, with more emphasis on wellness and human powered travel. So that was pretty cool. Nature is something that , where I live, we embrace pretty passionately. The view from my home is a wooded canyon, and we have a number of hiking trails only a few minutes away.
Panelists also said we’re going to see more emphasis on creating wellness refuges in our homes, such as improved air quality, opening windows, eating outside, air purifiers, things like this. Of course, that trend is in large part a result of the pandemic.
What really grabbed my attention, though, was what the panel called a “great un-tabooing,” with more focus on larger issues like sex, money, and death that significantly affect wellness. The panel also suggested we will see people getting “real about money with new financial therapy/wellness approaches.”
I couldn’t be more excited. I’ve been a certified financial planner for decades and only recently have I become a certified financial therapist level one. I started this journey of helping people understand the emotional side of money some 20 years ago. At first, I often felt that my CFP colleagues, when they saw me coming down the street, would cross to the other side to avoid the CFP therapist nut.
And the truth is I have pretty well-developed left brain. I spent 12 years and $80,000 in group therapy just to find out I had a right brain. So I can’t say that the therapy side of things comes easily to me, but I’ve known for a long time that it’s pretty important. So have some of my peers. The union of financial planning and therapy had its roots a couple of decades ago with the beginning of the Nazrudin Project, a leaderless group of financial planners, therapists, and coaches that got together once a year. We are still meeting after 26 years. One of the founders, the late Dick Wagner, was well-known for saying, “Talking about money is a 21st century taboo.” I find it fascinating that this breaking this taboo is working its way into the mainstream.
Then Daniel Kahneman, a psychologist, further cemented the relationship between money and emotions with his groundbreaking research that won a Nobel prize in economics in 2002. He found that 90% of all financial decisions are made emotionally, not logically.
Even though the Financial Therapy Association celebrated its 10th year in 2020, understanding that union of emotions and money still has a long way to go. Education in the field of financial therapy is growing in universities’ financial planning programs. Yet not one college mental health program has embraced the concept. When I started this work, I thought, wow, the mental health profession is going to be all over this. Instead, it has been financial planners who have moved toward financial coaching and therapy.
Eventually I think that’s going to change as the concept of wellness continues to expand across the medical, mental health, and financial professions. I don’t know when that will come together. I’m hopeful that the mental health profession, especially the colleges and universities, will begin to embrace the idea of financial therapy. Until then, we will continue to blaze the trail.
Check out The Financial Therapy Podcast by Rick Kahler