Do Not Give The Gun To The Dog

Financial planners are like hunting dogs.

When you go hunting, you choose what to hunt, when to go and where to go.  You may take a dog.  When you are hunting, a dog is a wonderful asset, but when it comes time to shoot, you do not give the gun to the dog.

With financial planning, sometimes the shooting starts too soon.  Sometimes even before the when, where and what decisions are complete.  Hunting dogs want to be doing something.  Hunters need to be more strategic.

Most financial planners are good company and have a lot to contribute.  Their defect is that if you do not know what you want to do, they will decide for you.

That sometimes does not work well. 

start with strategy, the answer to all the “W” questions.  What am I trying to do, what do I have to get it with,when do I need it, who is involved, where will I be and so on.  A planner can help you complete the list but you must decide the mission.  If they decide the strategy for you, there will be problems later.

Planners are useful when they help you prioritize and set up a time frame to accomplish the parts that are not completely solved in the beginning.  Most clients do not have the unlimited resources needed to do everything immediately.  Planners can quantify the effects and recommend a course of action.

The planners role is tactics and logistics.  Find a way to get he what you want on your terms and help make it happen.  Tactics belong to the planner, and all answer  “How?”

Your role with the tactics is to select which option you prefer.   Tactics exist in a complex and ever-changing world. Taxes, law, economic and investment background, politics, family law, various products that encapsulate several of the parts, and more.  You do not need to know much about them.  Avoid details.  Look for outcomes.

If you have a sound strategy you can easily say no to things that don’t fit.  If you know what you are looking for and have communicated it, it is likely that no one will recommend things that don’t fit.  An added time-saving bonus.

Beware of the tactic that is the solution to no known problem.  That happens when you have no strategy and the planner implements what they want.   Tactics must match your context not theirs.

Be cautious.  The world conspires against you.  You will see advertising that confuses rather than clarifies.  For example, I recently saw an ad that trumpeted “a unique RRSP strategy.”  There is no such thing as an RRSP strategy.  Anyone who uses the term that way does not get planning.  An RRSP is a tactic.  The strategy is to have money to spend when you retire.  The RRSP is “HOW” you might get it.  There are other options.

In the end, your job is to select among tactics presented by the planner.  You should not consider one unless it is presented in the form, “Given what you are trying to accomplish with this decision, any of these options can work for you.  Let me show you how they differ, the advantages and disadvantages of each, and how they may integrate with other parts of your plan.”

Your role becomes to decide and supply the resources.  The planner’s job is to help you cover all the strategic ground, discover tactical options to achieve your plan, and help to implement your choice.  In the future, the planner can help you review and revise.

Start with a “W” question.  If you start with how, you will likely miss the reason you are doing it.  If you do not know where you are going, any road is good enough.  At first.. A

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Don Shaughnessy is a retired partner in an international public accounting firm and is presently with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario. Contact: don@moneyfyi.com

 

One Comment on “Do Not Give The Gun To The Dog

  1. Hey Don, I could not help but think to myself, all this is so true (your article today), but I wonder if the people that need to understand it, will understand it. You know, are you throwing pearls to swine? It probably doesn’t matter, if the reader doesn’t get all the subtleties, maybe just the idea that you need to define what you not, and not have someone do it for you is enough.

    I always enjoy reading your stuff.

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