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What Is a Holistic Financial Planner?

Connor Sung May 24, 2021

holistic financial planner with clients

Investment management is becoming increasingly commoditized. The rise of robo-advisors, increased regulations, fee evolution, and investor expectations are pressuring financial professionals to differentiate themselves and deliver enhanced value to their clients. To do that, they must humanize their services by offering more holistic financial professionals.

Holistic financial planning has proven successful for firms trying to identify additional revenue streams and fresh ways to delight clients. To succeed in adopting a holistic approach in your financial planning practice, it’s important to first understand what holistic financial planning is, as well as what holistic financial planners do differently.

What Is Holistic Financial Planning?

Today’s clients want wealth planners who go beyond determining the most advantageous portfolio and ask them about other areas of their lives—accounting for things like major life events and non-financial aspirations. Whether expected or unexpected, large or small, the major events of a client’s life can have substantial ramifications on both their financial plans and overall well-being. This extends to every type of planning—whether a client comes to you hoping for comprehensive retirement planning services or working with you to develop an estate plan.

These investors expect their financial planners to get comfortable helping them answer the questions “where am I going?” or “what am I doing?” based on personal aspects of their lives singular to them. Holistic financial planners take this top-down approach, asking their clients “what are your goals and how can we reach them?” A holistic financial planner doesn’t only focus on what a client can afford to do today. They also look towards where their client sees themselves in the future, and base all of their recommendations on the short- and long-term life goals of the client.

Fidelity’s “Three Principles of Holistic Wealth Planning,” explains how the definition of wealth and success is highly individual and includes dozens of life components beyond finances.1

Many investors think of things like their family, their ideal career, education, and physical health as natural parts of wealth planning, and financial professionals should be prepared to accommodate these expectations.

For those who want to work on improving their client’s wellbeing as individuals, not just their portfolios as investors, there are three essential principles of holistic financial planning:

  1. Continuous: Holistic planners reassess their client’s wealth plans at least once annually, while only 3 in 4 other financial professionals do.
  2. Personal: Holistic wealth planners become tremendously at ease discussing with their clients the multiple but unique life event topics important to them. That’s true of just 1 in 10 other financial planners.
  3. Comprehensive: Holistic wealth planners offer over ten in-house advisory services, while only 60 percent of other financial professionals offer this array of services.

To provide this level of exceptional wealth planning to their clients, Fidelity found holistic financial l professionals acquaint themselves with all the non-financial aspects of a client’s circumstances.

That helps them develop wealth plans with investors that improve that individual’s wellbeing, with an emphasis on delivering peace of mind and, ultimately, fulfillment.

What Do Holistic Financial Professionals and Firms Do Differently?

For its report, The Holistic Wealth Planning Maturity Model, Fidelity interviewed hundreds of financial professionals to learn the path they took to advance their holistic wealth development practice. Fidelity’s research showed only about 35 percent of firms lead with holistic planning. What distinguishes these firms, called Advanced Planners in the three-level maturity model, from others is four primary factors: culture, training, technology, and marketing.

Culture

Advanced Planner firms have been decisive in their efforts to lead with holistic planning. An essential component of transforming your practice, big or small, is gaining buy-in from the entire staff on the core principles of holistic planning. Among Advanced Planners, 87 percent believe financial planning is worth the time and resources. What’s more, 80 percent believe their firm prioritizes planning over product, compared to just 41 percent of Early Planners.

Training

Advanced Planner firms truly invest in their employees. Among these high-performing firms, 88 percent said they had some kind of training program to support financial planning, compared to 42 percent and 6 percent of Evolving Planners and Early Planners, respectively. Over 40 percent of advisors who started in investment management shared that obtaining the necessary training was a barrier to providing holistic planning—this is a critical component of transforming your practice.

Technology

Holistic wealth planning requires thoughtful deployment of several different types of technology. Implementing these technologies and ensuring planners are using them to the best of their ability is important. The most important differentiator with your tech stack is that you are providing an integrated technology experience. Ninety-two percent of Advanced Planner firms say their firm has enabled strong integration between planning software and other systems, compared to 54 percent and 15 percent of Evolving Planners and Early Planners.

Marketing

Marketing your holistic financial planning capabilities is important for establishing your firm’s reputation as holistic planners. It’s one of the primary ways to grow a planning business. Among Advanced Planners, 92 percent said their firm promotes their planning capabilities to clients, while 72 percent of Evolving Planners and 12 percent of Early Planners said their firm does. Promoting your firm’s planning capabilities and having flexible pricing models help clients with different needs find the right fit with your firm.

Establishing a firm that leads with holistic planning takes time and effort. Firms that advance in the four core areas mentioned above are likely to see strong improvement over time in regards to achieving scale, efficiency, and penetration of holistic financial planning services.

How Do These Firms See Results?

Advanced Planners, those furthest along in the maturity curve, make the substantial effort and investment in restructuring their firm into a holistic planning enterprise. Advanced Planner firms spend 1.5x the amount of time on each plan. By spending more time to develop each plan it becomes an opportunity to deepen their knowledge and relationship to their client’s lives. Even though they spend 1.5x the amount of time on each plan, they are able to deliver nearly 3 times the number of plans per planner. Moreover, almost 100 percent established a model for planning support and best practices, with 9 in 10 maintaining a central planning team.

Their commitment and efforts become quantifiable outcomes: appreciable productivity, deeper client engagement and expertise, and increased capacity to focus on what’s important.

Firms practicing holistic financial planning also tend to see remarkable returns on their investment. Fidelity found over the preceding year, these holistic wealth professionals reported 47 percent higher growth of AUM and 67 percent higher growth in the number of clients. Additionally, these firms revealed their financial planners had 1/3 more clients with over $1 million of assets with that planner.

By optimizing their firm’s culture, training, technology, and marketing, these Advanced Planners achieve remarkable client outcomes and enhance profitability.

Holistic financial professionals are at the forefront of their industry, delivering services that are humanized and cannot be commoditized, which creates exceptional value for their clients.

To learn more about becoming a holistic financial professional, read our blog post that walks you through steps you can take to start holistic financial planning.

Sources:

1. “Three Principles of Holistic Wealth Planning: An Approach to Financial Planning to Help Advisors Advance Their Practice.” Fidelity Investments n.d. https://clearingcustody.fidelity.com/app/proxy/content?literatureURL=/9899391.PDF.

2. “The Holistic Wealth Planning Maturity Model: A Path to Advancement for a Firm’s Holistic Wealth Planning Practice.” Fidelity Investments n.d. https://clearingcustody.fidelity.com/app/proxy/content?literatureURL=/9899464.PDF.

About the Author

Connor Sung, CFP® serves as the Financial Planning Group's Manager of Practice Management at eMoney Advisor. In his current position he provides consultative financial planning support and practice management to clients by helping them incorporate eMoney into their financial planning process. He also serves as a product expert and a resource for internal departments helping Sales, Live Training, Enterprise Relationship Management, Communications, and Development. Connor attended James Madison University, where he received his Bachelor's Degree in Finance in 2013. He earned in his CFP® designation in 2016.

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Welcome to
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Tips specific to the eMoney platform can be found in
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