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Values-Based Financial Planning: And Why It’s Important

Values-Based Financial Planning: And Why It’s Important

April 04, 2022

“Values are important as they guide our beliefs, attitudes, and behavior.”

When you think about your personal finances, your first thoughts aren’t usually about how and if they line up with your values. Instead, you may be focused on what feels important in the here and now — how your investment portfolio is performing or the debt you are trying to pay off. It may even feel like sometimes your values are at odds with your pursuit of money, but this doesn’t have to be the case.

Identifying Your Values

We believe that good financial planners use values-based planning and begin a financial plan by discussing a client’s values. At Schmerling Financial Group, we typically send new clients a set of value cards to help them identify the values that are most important to them. Our clients start with a deck of fifty cards and begin narrowing down values until they are left with the five most important values which we use to create their financial plan.

This exercise is an interactive way to define what you value most, so we can align your financial goals with your day-to-day decisions and long-term plan. This type of planning allows you to verbally identify what’s important to you, like retiring early versus working longer to maintain a certain lifestyle.

“Values reflect our life priorities and represent the things that are most important to us. Who and what we spend our time and money on reveals what we value.”

Using Your Values in Decisions

There’s no right or wrong answer when it comes to values. Identifying your unique core values can help you pinpoint the guiding force that drives you. This can make future decision-making less stressful and overwhelming by quickly eliminating options that don’t fit your established values.

Let’s say, you complete the values exercise and “family” is your number one value. Knowing this, we make sure that we include life insurance and an estate plan in your complete financial picture. This way, your family is taken care of if anything unexpected happens in the future.

We know that identifying your life’s values is an intimate and personal process and we are here to guide you through the experience. Our approach emphasizes self-awareness and emotional competency which in turn, helps to narrow what is most important and benefits decision-making. Once you know your top five values, we can tailor investments to align with your priorities.

At Schmerling Financial Group, we understand that your values are the key to achieving your financial and life goals and we refer to them often. Our goal is to help you plan and prepare for a life full of purpose.

Your Values. Your Priorities. Our Commitment.