Top Down vs Bottom Up
Never underestimate the value you add to your client’s life when you embrace the top down approach. It’s not about financial products, it’s about liberating your client so they can visualise their best ever life. It’s massively rewarding stuff.
Our natural instinct is to approach things from the bottom up
When you’re coaching with clients, and you get to the really fun bit – the “for what?” and questions like “what do you really want your life and lifestyle to look like?” – it can just feel like such a huge question for your client, with limitless possibilities.
Most client’s starting point will be something along the lines of, “well, nothing too extravagant!”
The fact is, they feel a bit inhibited – and worried that whatever they say might make them sound greedy. Nobody’s ever asked them what they want their lives to look like before – it’s just not the sort of thing they’ve had to articulate and share. So the instinct is to be a bit humble.
But we’re not interested in their ‘neanderthal’ needs
Deep down, we are also terrified of voicing all the things we’d love to have because we’re still worried about not having ‘enough’ – we are scared of running out of money. And to be honest, it’s an instinctive, human trait – a throwback to our neanderthal need for food, shelter and warmth. Without these things, our brains cannot even conceive anything more fun.
So, people instinctively approach things from the bottom up and just focus on what they need to live on. They have a mental baseline, and as long as they have that amount of income coming in, they know they can live on it – they’ll be okay. They focus on the bare essentials rather than the things that will really enrich their lives.
The result? When you ask “what do you want your life to really look like?” they deflect the question and answer a different question instead – “what do you need to live on?” In their minds, they are thinking about their monthly outgoings – their food, warmth and shelter costs. Your job, as a planner, is to reverse their way of thinking – to expand their horizons.
The bottom up approach is stifling
The fact of the matter is, the bottom up approach is just stifling. It restricts enjoyment and limits the potential for a fantastic lifestyle.
When your client is thinking ‘bottom up’, it makes them think small. It makes them feel anxious and guilty about even contemplating doing the things they’d love to do. They’ll say things like, “if there’s anything left over, we might treat ourselves to something…..”
But what they really mean is, if they feel a bit flush one month, or if their investments go up a little, they might ‘allow’ themselves to spend a bit. I have known clients who decide whether or not to go on holiday, based on whether their investments have gone up or down! Basing decisions on these sorts of hopes and expectations just makes no sense.
The problem is, we’re scared to spend our money. We’ve been accruing money all through our lives and every time we have more money in our account, it feels great! We actually feel better about ourselves. But on the flip side, it makes us believe that if our balance falls then we’ll feel worse. We get caught up in a negative mindset that sets unnecessary limits on our happiness.
It’s all just stifling.
So, we need to get them thinking top down.
Give your client permission to let go
Things are so different when you start from the top down. It liberates your client, enabling them to explore what they really want their lives and lifestyles to be like. We’re not interested in the basics, like food, shelter and warmth. We’re interested in all the other things – what have they left out? Those are the bits we need to nail down and get on the board. Those are the things that make you feel like you are actually ‘living’.
But, let’s give them a get out clause. Why? Remember, this is an unfamiliar scenario for your client. And there might be things they’d love to mention, but they don’t want to appear too extravagant. Maybe they are worried that you’ll laugh at one of their ideas – or that you’ll tell them that it’s just not possible because they don’t have ‘enough’. Nobody wants to be made to feel foolish.
All this stuff is going around in their head, so we need to give them permission to just let go and not worry. Make it lighthearted. Let them see that it’s okay to fail – and by that I mean acknowledge that it’s okay at this stage if some of these things don’t end up as viable.
Just get them to let go, “if you could have anything you want, what would it be?” And you know what? It’s very rarely yachts and luxury cars that people want – it’s the simple stuff that makes them happy. So give them permission to let go and make the process comfortable, easy and fun.
The top down approach liberates your client
Reassure your client that they can still achieve a fantastic version of their very best life, even if the cashflow modelling reveals that they can’t quite have everything on their list. Tell them:
“If you don’t have enough to do some of these things, I’ll let you know once I’ve done the maths. But if that’s the case, don’t worry – if we can’t quite manage everything you’ve mentioned, we’ll just notch it down a little. We’ll just take a little bit out and see if that works. And if we’re getting closer (but we’re still not quite there), we’ll just notch things down a little more until it works….”
And eventually, you’ll get to a stage where it really does work – brilliant! But even though you’ve removed a few things, by working from the top down (rather than the bottom up), you’ve reached the very best possible version of your client’s life and lifestyle – they can see it there, on the board. And it looks fantastic!
Look at the value you’ve added!
Just look how much value you’ve added. Look at the difference between the best possible version of their lives and the one they came in with (the one that was based on their fear, anxiety and basic survival needs). You created that incredible difference. Yes, you!
And you didn’t have to make any financial investments, talk about products, charges or try to convince them about possible rates of return. All it took was a single conversation. Just look how much value you’ve added to their life. If that was an investment product, just imagine how many people would be trying to get in on it!
But it’s not a financial product – it’s called coaching and planning, and that’s where the value is. You’ve helped them to visualise the very best, achievable version of their lives – you’ve added incredible value.
And that’s the beauty of approaching things from the top down.
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