Kitces & Carl Ep 134: Helping Clients Who Can’t Ever Get To ‘Enough’ (And When They Don’t Really Want To)

***Editor's Note: Can't get enough of Kitces & Carl? Neither can we, which is why we've released it as a podcast as well! Check it out on all the usual podcast platforms, including Apple Podcasts (iTunes), Spotify, and Stitcher.

Show Notes

• Kitces & Carl Ep 127: Creating Value Through Presence (And The 50 Fires Podcast)
• Kitces & Carl Ep 133: Should Advisors Market The Real (Self-Actualization?) Value Of Financial Planning, Or Just Do It?
• Another Side of Downtown Josh Brown – 50 Fires Podcast
• MoneyGuide
• Bain & Company's Elements Of Value

Kitces & Carl Podcast Transcript

Michael: Well, hello there, Carl.

Carl: Michael, Michael, Michael, how are you? Hey, what did your parents say when you're in trouble? My mom would yell, David Carl Richard III. What would your parents say?

Michael: It's a good question. My parents didn't do the middle name thing. Wow. It was just Michael Kitces.

Carl: I love that, Michael Kitces.

Michael: It's like the "cha" of the Michael and the "Ki" of the Kitces, it rolls well. You could put some real spin on that if you're wound up and angry.

Carl: That's perfect. Perfect. Yeah.

Michael: Yeah, I didn't get the 3-name thing. I just got a lot of emphasis on the K's.

Carl: Perfect. Okay. Michael Kitces, welcome to the show.

Michael: Thank you, Carl. Thank you. So, I wanted to talk in today's episode, kind of extending maybe the conversation we had a couple of weeks ago around this...yeah, clients on their self-actualization journey and our ability to impact that with the advice that we give. And then maybe we do it, we don't necessarily market that we're self-actualization experts. We just give the awesome, meaningful financial advice and ask the impactful questions that steer clients down that road so that eventually it's no longer about the money. It's about their transcendence and impact to the world and all the things that come at that level.

What Do You Do With A Client That Doesn't Realize They've Attained Their Goals? [02:26]

The question that I've been hearing back that I can certainly recall from client meetings over the years, and I suspect you have as well, what do you do for the client that doesn't realize they're there? This is the infamous you have enough. You have more than enough. You said all the things you want to do. And you have more than enough to do all the things that you want to do that you've said you want to do. And my goals in my MoneyGuide plan and you're still going and you can't seem to stop, right? They built the business and now they don't want to sell it. It's like, well, now I could make it twice as big. I'm like, what are you going to do with the money? You already have all the money you needed to do all the things that you said you wanted to do. Or like they work and they can't figure out how to stop working, or they work too many hours and they can't seem to figure out how to dial it down. I'm sure I'm preaching to the choir here that you've seen this as well. Just the clients that can't...they can't figure out what's enough. They can't accept what's enough when they seem to basically be at the enough stage.

Carl: Mm-hmm.

Michael: So my question to you, very directly, as the expert in communicating to clients, no joke, if I did all the things that make them self-actualized and they've done everything except actually realize they're self-actualized, how do I get them there? What do you do for those clients that can't seem to realize that they've already won the game and they have enough? You mentioned earlier that people win and then they go, "Oh, crap, was this all?" And they have their priority shift. But I'm thinking at the other end, they've won the game and they don't seem to realize it.

Carl: Great. Yeah, I love that. It's interesting. I had Josh Brown on the "50 Fires" podcast, and I asked him what was like the one big mistake that he was seeing people still make with their money. And he was like...and he went a different direction than I thought because he talked about advisors and just said that our biggest challenge right now is helping clients who've saved enough, that behavior that got them there won't get them to the next thing. And so I've thought a lot about this because I love entrepreneurs. And I did some research maybe 12 years ago on where I went and interviewed a bunch of entrepreneurs that had had successful exits. And what I uncovered was really interesting to me. So I think there's two answers. I want to talk about this one. And then the second answer is therapy. You know what I mean? It's not our job. There's just nothing we can do.

But one of the answers I think is interesting is what I uncovered from entrepreneurs that had had a successful exit. And I've got a really close friend who...hundreds of millions in exits, more money than he'll ever need, and yet is building again. And the reason he's building again is because he has a very specific...these aren't like social media businesses. He has a very specific thing that he does in the world that is protecting all of us. He's in cybersecurity. And so he feels like he was put here to do that thing. It doesn't matter. The money doesn't matter, except that it's a measuring stick in terms of impact. And I heard that from a lot of entrepreneurs with a successful exit is they're like, this is what I do. And it was interesting because they said, you know what you guys all tell us, you financial planner people, you all tell us we should hang it all up and golf. But this is what I do is I build companies and I love building companies. You okay with that?

Michael: Yeah. Yeah. So the answer for at least some of them is they are self-actualizing by building their seventh company. Stop giving them a hard time and just get out of their way.

Carl: Yeah. But the thing we have to realize is... it's really interesting because, again, close friends and research from non-close friends, but watching...sometimes that has impact on other people. Do you know what I mean? So it's like, you got to realize, well, does your spouse feel the same way? Do your kids feel the same way? How does that fit in? And so I think the only way we get involved in those conversations is if it comes up like, "Hey, I'd really like to spend more time with my kids. They're a little older now." "Oh, okay." And, and we immediately get the, "Here's what you say you want. Here's what you're actually doing." Because the next phone call, you know, a month or two later, "Hey, you know what? It turns out I've got an opportunity. I want to raise some more money. I need to talk to you about it because I want to start another company." And right then you get a chance. "Hey, let me grab my notes from our last conversation real quick. Oh, that's right. Hey, just checking in before we go down, just checking in. Remember you told me it was really important to spend more time with your kids." And again, I'm not...we can't be judgmental. That's the other thing I've also realized. Some of the... let's take it away from entrepreneurship land. You've got some of our clients, many of the clients of advisors listening were very frugal, just had a good income, not great, had a good income. Saved, saved, saved, took the 10-cent Coke bottles in, the whole thing. And they love doing that. And you get to the point where you're like, "You don't have to do that anymore, you could charter the jet." But they don't like it. And it turns out that, as hard as it is for me...

Michael: Because they literally like doing frugal things and being frugal.

Carl: They like it. And it's not for us to judge that they shouldn't do that. But let me just tell you one story, which is really good. This is one of my favorite financial planners in the whole world. A guy named...I got to be careful. Did he tell the story publicly? I think he wrote about this story. So a guy named Alan Smith over in the UK is one of my favorite people and also one of my favorite planners. And Alan tells this story, and I'm going to obscure the details a little bit because I can't remember if I know the written, the public version or the non-public version. But he tells this story about a client of his that he had that really had a bunch of relatives moved to another country long ways off, like ancestors, grandma, grandpa, great grandma, grandpa had moved to another country a long way off. And she had always wanted to go. And particularly, she had always wanted to go see a rugby match by this country's team. But she was like, "I can't. I can't. I can't travel." She was older, but she had more money than she'd ever need ever be able to spend. And she really wanted to go. And the country...I think it's okay. The country was Argentina, right? So she really wanted to go to Argentina. And Alan kept saying, "Well, let's make this happen." He'd heard this a couple of years in a row, right? And again, I'm paraphrasing the story, but he'd heard this a couple different times. He's like, "Well, let's make this happen." "Oh, it's just too expensive. Well, I can't sit that long on a plane." And Alan was like, "It's okay. You can afford a life seat, bed. In fact, we can get you kind of a suite if you wanted." "Oh, I can't." And Alan... And I think we need, this is art. We need to figure out where we can push here and where it's not our job to push. But Alan, in this particular instance, saw an opportunity and introduced the client to a travel agent, basically got the thing booked. She went and it was one of the coolest things ever. I think she decided to go again. And so I love that story because there are moments where we can just be like, "No, let's do it. You've been talking about this for 10 years at a time." And there are other moments where we're like, "Oh, it may not be important to them and we don't want to put our values on other people's plans." Right?

And then there's last thing. Then there's therapy. It could be like, dude, you're ruining your whole family, your health, everything, and you don't need to. You're just addicted to the importance and dopamine hits of building the thing or saving more money or trading or whatever it is. That's a different category. But you should fire me if I don't tell you. From a financial perspective, you do not need to be doing that. Right? There's that piece, too. How does that land?

Michael: I think the part of it that strikes me, that resonates with me is there's a version of these kinds of behaviors where the reality is they literally enjoy doing it, right? The frugal person, they get their dopamine hits when they save another 10-cent bottle cap, even though they have $10 million and they really don't need the bottle cap. It's literally making them happy. Okay, let them be happy. Or at the extreme, because they want to go make another company, they can't quit their job and retire because this is basically their self-transcendence phase, to use the last episode. This is their impact and do-good-in-the-world work. Why would they quit that to play golf? Golf is lower on the actualization scale than helping the world as awesome as golf is. If you're already up here at save the world, you don't need golf...unless you want it, no judging about golfers.

So there's one version of this, right, that's no, no, they're really doing a thing that makes them happy or might literally be the pinnacle of this pyramid for them. And then there's another group that's more conflicted.

Carl: Hold on, before you move on to that, I just want to put a pin on that because I think that's really important for us to understand. And we need to...one of my favorite sayings around this is keep your values off your client's plans. And I think that's really important there. It may be your worst nightmare to be that frugal or to care about taking the coupon to Bed Bath & Beyond. But if the client likes it, as long as they know they don't need to, who cares? Okay, so go on to the next group.

What About A Client That Is Expressing Conflict Or Turmoil Around Achieving Their Goals? [13:20]

Michael: So to me then, the next group are the ones that are expressing some kind of conflict or turmoil around this. Right? "I have to create the next company. I have to keep doing the work that I'm doing. It's so impactful in the world. I feel really bad that I don't have more time with my kids though."

Carl: Mm-hmm.

Michael: So maybe the most important thing is not actually the world impact of your work. Maybe that's a story you're telling yourself or a dopamine addiction thing you've got to something that you do in there that is good and feels good, but maybe doesn't actually feel as good as the time with your kids that you're actually articulating that you want to spend. And there's some turmoil there. Part of what I'm taking away from the conversation is my clients that are in this, you're doing a thing that's making more wealth and you already won the wealth game. Why are we still playing this game? Do you not realize that you have enough? Yeah, but is it actually a problem for them? Because if it's not a problem, it really might not be a problem.

Carl: Yeah.

Michael: If they do articulate a problem, then we need to have this conversation.

Carl: Yeah, I love that. And that's when that problem comes up. And we've all had this experience. I know I had it a bunch of times and I've heard stories about this over and over where you finally introduce to the client, like, "Hey, you know, I was thinking about that thing you kept telling me. Do you know? Let me show you. You don't have to do that anymore." And they're like, "What? Oh, my gosh, are you serious? Really?" "You could retire at 55 because we know about how to get money out of your IRA before that." Or you introduced some planning solution that they were unaware of. And now suddenly it opens up. Now there's a different thing of saying, okay...I remember when I had these clients, Dave and Diana, and they wanted to go travel when their kids were young, they wanted to rent because they were like, by the time they get teenagers, they won't want to hang out with me anymore. I want to hang out with them when they're young. I want to take a sabbatical. And I remember they said, "Can we? Six months, ER doctor, I've already arranged it with work. It's fine. But can we afford it?" And I remember saying to them, look, I'll go... I already knew the answer. The answer was yes. But I didn't tell them that. I just said, "Before I go do the calculations, if the answer is yes, I have a big question for you."

Michael: Are you actually going to do it? If I tell you yes, you're going to do it? Because I don't want to just run the numbers for...

Carl: Yeah. Don't waste my time. But I just remember thinking they looked like a deer in the headlight when I said that. They both looked at each other and they were like...

Michael: No, you're supposed to come back and say no, Carl. We were not thinking you would say yes.

Carl: They were like, "Yeah, we would." And that I guess we're pointing at that same moment of, maybe it's retirement, maybe it's slowing down, maybe it's switching from being a surgeon to teaching at the med school, you know, whatever it is. "When you introduced the idea, did you know that's possible?" That's a beautiful opportunity. And now whether they decide to do it and there may be some therapy involved here that's out of scope, you know, but the idea that you can tell them that it's possible if they actually want to, that's really cool.

Michael: So can you walk us through a little bit more then how you set up this conversation, right? Is it literally like, "Did you know it's possible?" is, the turn of phrase, is the buildup, right? You're sitting across the client that's, you know, "Well, I really don't want to stop working because I so enjoy the work that I do and it's so fulfilling. It's like I don't even need the money anymore, I just love the work that I do. But, you know, I do feel a little bad that I don't spend more time with the grandkids." Okay, you did the thing where you said you don't care, but you really do.

Carl: Yeah, that's exactly it. I would just be like... And I love always referencing... I'm hopeful that this may have come up a little earlier, maybe in a discovery meeting or somewhere along the lines. We've been working together for 10 years. You've mentioned the kids and the grandkids a couple of times. So I always love the idea of, "Hey, gosh, John, that's interesting you say that. It reminds me of a conversation we had a little while ago." And maybe there's not that conversation, but if I can reference notes, I've heard this before, or...

Michael: The conversation last year where you felt bad that you didn't travel for the grandchild's birthday.

Carl: Yeah, something like that. That's beautiful. Let's say there's, that doesn't exist. This is the first time you've heard it. You'd just be saying, "Whoa, whoa, whoa." That's how I'd be sometimes. I'd just be like, "Whoa, Whoa, John, hold on a second. Let's back up a second. I just want to make sure I understand something. Did you just say, 'I love work, it's great, and I feel a little conflicted about not spending time with the grandkids'?" And they're like, "Yeah, actually." "Well, let me just check in here. Is that one of the roles you would see money playing in your life? Is the reason...is this a financial discussion? Because we can solve that problem pretty quick. Just give me a couple of days in my calculator and we'll solve that problem pretty quick." And then it's like, if somebody said, "Yeah, I really want this." So I'm thinking in Venn diagrams here, one circle is this is what I said I really want, I want to spend more time with the grandkids. I want to slow down. I want to teach at the med school. I want to work in the community garden, whatever, and yet I'm behaving this way and we've already presented to you that it's not a math problem anymore, now we're clear about what we're really talking about. And that's the exact phrasing I would use. Like, "Hey, it turns out this isn't a math problem because I've shown you the solution to the math problem. And so let's get clear about what we're really talking about here. It's not a financial discussion. It's a discussion that you need to resolve." And in other elements, I'm like, "Actually, what we're really talking about here is..." And with clients, this isn't the right phrase, but, "What we're really talking about here is fear." It turns out writing the book is not hard, right, you're just scared to do it. And I think that's a very similar conversation. "Look, we've solved the math here for you. What else is holding you back?" "Oh man, I just love work."

Is The Conflict Really About The Dollars? [20:02]

Michael: So I was thinking further in that direction. There is a subset of these clients, frugal Frank, I show him the math. He basically doesn't believe the math or discredits the math or he starts coming up with assumptions of terrible futures that mean, no, no, no, he still needs more. He wants to torture the math a little bit further anyways. So my inference drawing on this, from what you're saying, is that ultimately I need to at least shift the conversation or at least test the waters of, "We can do more math on this, is this really about the dollars?"

Carl: Yeah.

Michael: Or is this about something else?

Carl: Totally. And what you're pointing to is just beautiful. Often it doesn't really matter how much money there is if it's a security issue. If you're insecure with money, more money won't solve that problem. And so trying to spray people... I think it's important to be like, "Hey, can we do a deep dive on the math for a bit here? Can I have can I have 15, 30 minutes here? Let me just walk you through it. Here's the math." And then at the end of that, "Yeah, I'm just not sure. I'm just not..." If it's still a security issue like, "I don't feel secure," well, that's that's a problem money can't solve. And nothing we can say can solve that. That's a therapy problem. And I don't say that lightly. I'm a huge fan of therapy. I was literally just trying to find a therapist. So I'm super cool with it. But I think it's just...I think our job largely is, oh, I think either directly, kind of punch-in-the-face style or empathetic hug style, "I notice you're telling me one thing and you're behaving a different way with your money. That's really interesting to me. I wonder if we could circle back to that. You've told me a number of times you want to spend more time with the grandkids, and yet you're taking on new projects at the hospital. I just want to check, is that because it's a... Do you agree you no longer need to do that financially or do I need to walk you through that?" And I think that's okay to point out. I think we're one of the only people that have implied permission, not explicit, but implied permission to point out inconsistencies in behavior because people have told us they really want this and they're behaving this way. And I think my favorite phrase in this conversation to enter it has always been, "Michael, you may fire me for what I'm about to say, but you should definitely fire me if I don't." Right? And then have that conversation really repeating. Remember, they're the ones that said more time with the grandkids was important, not you. That's not your value.

Michael: Right, right, right.

Carl: Right. It's not your value. So we can say maybe the values changed. And we're cool with that. Maybe this new project at the hospital is actually an opportunity to leave a legacy that's more important to you right this second. That's cool. So I think that's clarifying the value, being unafraid to point out inconsistencies, making sure they understand that the math is taken care of. And then at the end, realizing after the math, there's a level at which we're incapable of being helpful. It's beautiful, man. So good. I didn't know we were allowed to have this conversation with the chief nerd at Nerd's Eye View.

Michael: Well, I love all things logical consistency. So frankly, you had me at the clients as being logically inconsistent in their behavior. Like you...

Carl: This algorithm does not calculate.

Michael: You caught me. You caught me right there. Yes. And then say, "Hey, you're saying A and you're doing B. Can we talk about that?" Right, which to me is a very comfortable space to flow into at that point. To me, my big takeaway from this overall is, as you aptly put it, keep your values off your clients' financial plans, that I'm not looking for people who have enough and can't seem to enjoy the wealth that they've built because they have enough because maybe they're actually happy not living it up on their wealth because that could be their thing. I'm hunting for people who are expressing the inconsistencies, who are expressing the inconsistencies of I say I'm happy to keep doing the thing even though I have enough and then I start complaining about something.

Carl: Yeah, or I at least introduce a thing I'd really like to do. And, yeah.

Michael: It's like, so why don't you do it? If I could show you it wasn't a money thing, would you consider it?

Carl: Yeah, and you've got Alan's great example of trying to really sort of inserting himself in the process and sensing that they wanted and needed that. And now a lifetime memory has been made. "What? You're my financial planner." You know what I mean? That's so much value.

Michael: Very cool. Well, thank you, Carl.

Carl: Cheers, Michael. That was fun. Thanks.