In many ways, financial planners are similar to therapists, and meetings with clients can be as much about personal growth as financial success.
In fact, Paul Turner sees the two as inextricably linked and is fascinated by the money behaviours people adopt over a lifetime – sometimes to their own detriment.
Many clients go to great lengths to analyse the performance of the sharemarket and what went wrong in the GFC, but sometimes they fail to analyse the personal money inhibitors that stymie their progress.
“Some of these behaviours are repetitive and can hold people back,” Turner says. “In many ways, we can be our own worst enemies when it comes to money.”
For example, Turner cites the common “herd mentality” behaviour that can be self-destructive when it comes to investing.
“People are at a barbecue and they hear their friends talk about how many properties they own and they think that you can never go wrong with property and they start investing,” Turner says. “Then the GFC will hit or, in our case in Western Australia, the mining boom will end and people can be in a real financial hole.”
Turner is particularly interested in the psychology of finance. He is studying his masters in financial planning and one of the units is devoted entirely to behavioural finance.
“The things I am learning through my study are concepts I am able to apply with my clients straight away,” he says. “That’s why education while you work is such a great thing.”
Turner says he often finds himself in front of couples who are discussing their finances and learning things about each other that they never knew.
“In many ways, it can be like a couple’s therapy sessions,” he says. “You can be the conduit through which they express their views about money and you can see them learning things about each other.”
Turner says he often notices that men and women approach finance very differently.
“Men can sometimes be overconfident,” he says. “They will not necessarily do their due diligence or look into something fully. They tend to over-trade and try to time the market. Not all men, of course, but some can.”
Women, on the other hand, tend to be like sponges.
“Women are often the most successful investors,” he says. “They will have their diaries out and they are just ready to absorb all the information they’re given. They’re willing to take advice and they concede they don’t know it all. ”
One of Turner’s favourite parts of the job is communicating seemingly complex financial information into cogent and easily digestible material.
“I think people feel very overwhelmed by finance sometimes and you get great satisfaction when you see that lightbulb moment happen for people. You can see it on their faces,” he says.
One of the challenges of the job is dealing with people’s reservations about the industry.
“There have been a few stories in the media about planners and it can influence client behaviour,” he says. “Sometimes you are really starting on the back foot with people and you have to convince them of the value of planning. But overall I think the industry is in a great position nowadays and the education requirements are part of a progression.
“And it’s a great thing to be part of.”
Name of firm: Wealthwise
Name of licensee (if not self-licensed): Financial Wisdom
Years in the industry (previous jobs?): 10 years
Academic qualifications: Post-graduate diploma of business, advanced diploma in of financial planning, currently halfway through completing a master’s degree in financial planning.
Accreditations: AFP, SSA
Professional association memberships: FPA and SMSF Association
Other memberships: Most Trusted Adviser Network