John Maher: Hi, I’m John Maher. Today, I’m here with Rick McDonald, President of the US Advisory Group – a private financial management company in Massachusetts. Today, we’re talking about “Uncovering Your True Strengths to Create Lasting Financial Freedom “. Welcome, Rick.
Rick McDonald: Hi, John. How are you?
Uncovering Your True Financial Strengths
John Maher: Great. So, Rick, how do you uncover your true financial strengths and what do you mean by that?
Rick McDonald: That’s kind of a great question. Let’s step back a little bit. As family advisers, we’re tax experts, we’re money managers but those capacities are tools to the end.
The real issue – and we work with folks at the outset of our relationship in this deep, deep, deep data drive – we need to understand who we are – what really matters most to us. And our core goals are founded and driven, defined by our values.
So who are we as a person? See, most of us are never comfortable with money. We’ve always lived in a state of anxiety. We’re never sure we have enough. We don’t communicate very well with our spouses about it. We’re always fidgety, nervous, upset about money matters. And so, what we want to do to really develop the kind of structure that’s going to define freedom, is to really first and foremost, know yourself. Understand who you are, what you are, what matters to you, what inspires you.
Core Values and True Goals
And as we develop your core values, those values will then authenticate your true goals – the goals that will truly make sense, really matters most to you. Half our goals are throw-away goals. There’s not a lot of meaning to them.
John Maher: Right.
Rick McDonald: And our core goals are what we all what we want to focus on. So as our role as an advisor of the families is to help people truly understand what really matters. What’s the purpose of your wealth. You’re working nine to five, eight to ten, whatever it might be. You’re spending tons and tons of time accumulating a pile of money but for what? What purpose? For family? For the support of lifestyle? That’s all fine and good.
Where are you going with it. What’s really going on with it? Where’s the end game? What does retirement look like? What do you want to do with retirement? Where do you want to live? How do you want to live?
These are the kinds of things that are really going to give you a sense of security, that give you a sense of financial freedom, because when you know what these are, when you do dive and understand, nominate what the numbers look like but why these goals are important to you in the first place, then we can fund the strategies, create strategies to fund, support, maintain these various objectives and give you that sense of security.
Financial freedom is a sense of security, a sense of well-being. And too many of us walk around overly thinking about the stress of money or not having enough, never feeling we’re satisfied.
We’re society of people who are never seemingly satisfied. Why? Because we’re really never sure what it means to be satisfied. Fear of not having enough. We want to get rid of that issue. That’s so debilitating. Why so many people are upset about money, why they’re upset with their advisors about money, why they’re nervous about — Who cares day to day to day. What the stock market –? You’re going to listen to the radio while you’re driving. The market’s up 100 points down, 50 points at — And really we go crazy.
What Financial Freedom Means
John Maher: And what does that really mean to you?
Rick McDonald: Right. Does that matter? I don’t really know. In a long period of sequence of day to day to day, maybe it starts to matter but bigger picture is do you understand what you’re trying to get accomplished? Do you have the means and resources being allocated the way they ought to? Do you have a sense of confidence that you’re moving closer and closer to a finish line that’s predefined that will give you the sense of accomplishment and lift that weight off our shoulders? This is what financial freedom and the context of freedom really is.
John Maher: Right, so what’s the process for starting to uncover that information? Is it a matter of just talking to people and trying to figure out what their goals are or do you have a certain process that you go through with them?
Rick McDonald: Well, as you mentioned before, goals are important and most people start with goals. The problem with them is the goals are the middle point, not the beginning point.
John Maher: Okay.
Rick McDonald: Our true goals are defined by our values, who we are, our make-up, our DNA. Values are not learned. They’re experiential. So we start with clients and talk a little bit about what are meant growing up? What were your earliest recollections about money?
When you grow up, was money abundant in the family? Did dinner calls with your mother and father — and growing up with your siblings, were you interrupted by bill collectors at dinner time? Were there stress, obviously, between your parents over making ends meet? Maybe you have an allowance. What it means to save? What’s your relationship with money?
If you went to college, did you pay for it yourself? Did you have a lot of loans? Do you understand — they’ve seen the issue of leverage of borrowing or mortgages. How did you grow? All of these have impacts on us. We all create a weight towards how we think about money?
John Maher: Right. We might want to make our current situation more like what it’s like for us growing up or we might want to be trying to avoid some of the situations that we had to deal with when we were growing up.
Rick McDonald: Sure. I think we don’t want to go overboard. We want to try to be psychotherapists but we need to relieve ourselves of the weight of the — Some of our earlier influences, frankly, might not have been positive. And we need to be uplifting and move forward, and not be carrying the cross all our lives for how we grow up.
All of these matter though. And this is really, really what I’m getting to. All of these impacts you how you think or feel about money. It also defines the goals that really are going to make you feel good about what you’re doing going forward. How you relate to your children? Do you want to help them? How much do you want to help them – your grandchildren education? Where does that all play relative to you and your spouse and having lifestyles and support the kind of things that make you feel good about who you are and what you are?
These kinds of things are really, really important. They, then, can help us understand what it means to build a retirement portfolio, because that’s different things to different people. I hear these people talking about — ‘We’ll, if you’re going to retire, how much do you need to retire?’ ‘$100 thousand.’ ‘Okay. So we need a $200 million portfolio.
That’s a milk toast. It’s not real. It’s just conceptual. And it’s a consequence if that’s what you’re doing currently, you’re not buying into it. There’s a part of you. There’s that inner voice saying this isn’t right. Something’s not right and not in alignment yet. The reason it’s not an alignment is that there are other influences in your life that are telling you you’re in conflict. Things aren’t balanced yet. And that’s really a question of going back deeper into understanding your relationship with money and your goals and objectives that are influenced by these experiences.
When you get that in alignment, all of a sudden, things become clearer. You have these a-ha moments. And all these fogs, these anxieties are dissipating. And now, we can focus and drill down deeply, and focus on our plan. That’s your plan that you’re going to have more confidence in. And as you see the attainment of these goals, you’re going to feel good about yourself.
Because in the end, money doesn’t get us anything but stuff. What stuff matters? Most of the stuff that we have accumulated in our lives really aren’t important and we want to focus on those things that are important, so we really have a well-defined life.
John Maher: Right. So we’d go back to, like you said, our core values. And then, those values that we uncover are what’s going to set up what our goals then become. And then, you use that information and you start building your financial plan accordingly.
Rick McDonald: Right. We have a process where we’re going to take you back, and then, understand who you are and what you are. And your core values – that value structure, when better understood, will create a template, a touchstone which will authenticate the goals that are really going to matter most to you.
John Maher: Right.
Rick McDonald: And then, we have work to focus on — Now, we know what the big picture really needs to look like. And we’re not chasing — I joke about this. It’s tough enough finding the needle in the haystack. But if you don’t even know what the needle looks like, you’re not going to find it.
John Maher: Right.
Rick McDonald: And that’s why most of us live a life of anxiety with regard to money. We just don’t know what we need. We don’t what we’re doing. We don’t know what we are doing is the right thing to do. And we’ll always live in a state of incompleteness.
John Maher: Right, right. And this leads to lasting financial freedom, as you call it? How? I think you sort of mentioned it before but it’s because once you’ve learned your values, you’ve set up your goals, you start to build your financial plan, then, like you said, you can just sort of let go and not have that anxiety with you?
Rick McDonald: You could be free.
John Maher: Yes.
Rick McDonald: It’s very, very uplifting when you know the things are being done right. Whenever you do something in life and you knew you did it right, it just makes you feel good. You just feel like ‘Wow! That was the right — I hit the golf ball the right way.’ It was a great feeling.
John Maher: Right.
Rick McDonald: I did something for a friend that really matters to them. That was a great feeling. If your finances as important as finances are in our life, our finances are in the right shape and we know it, and we have purposeful portfolios that are giving us the reinforced feeling of things being the way they ought to be, just makes you feel right. Makes you feel good about who you are, what you’re doing for your loved ones, and it’s uplifting as anything in life when done well. It should be uplifting. That’s the objective.
John Maher: That sounds like a great objective. Well, thanks for speaking with me today, Rick. I appreciate it.
Rick McDonald: It’s been my pleasure.
John Maher: And for more information, you can visit the US Advisory Group website at usadvisory.com or call 781-246-0222.