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How Advisors Can Create Financial Plans That Reflect What Investors Really Want

Sidestepping the limitations of goals-based planning.


An investor’s goals are essential for any advisor to know, so they can create an appropriate financial plan. The problem is that many investors don’t truly know their own goals. And even if they do, their goals can change as their lives change. These are some of the limitations of goals-based planning, despite its importance and positive impact.

Even so, it’s clear that when done right, goals-based investing can be a win-win scenario for clients: They can reach their goals and avoid behavioral pitfalls in the process.

In our latest research, we explore whether providing a positive psychology framework could elicit deeper goals from investors. Instead of throwing in the towel, advisors must help clients uncover their true financial goals, which involves moving past top-of-mind and surface-level goals. Moreover, advisors need to account for some wiggle room in a person’s financial plan to prepare for changing circumstances.

How can advisors create financial plans that speak to what investors really want and also maintain a level of flexibility? This is where the concept of positive psychology comes in.

How You Can Find the Goals That Truly Make Investors Happy

Positive psychology is, in brief, the study of what facets of life contribute to happiness, fulfillment, and meaningful experiences. Adopting principles and techniques from positive psychology into financial planning highlights that our specific financial goals aren’t necessarily about the goal itself but about how the goal is going to make us happy.

In other words, there are different levels of goals: surface goals and deeper goals.

Surface goals are the typical goals that investors strive for and that advisors are used to managing: saving for retirement, a child’s education fund, or buying a second home.

Deeper goals are the motivations that drive surface goals. These goals are more akin to life goals or values and are related to an investor’s personal requirements for living a fulfilling and meaningful life.

Both levels are important in financial planning, even though surface-level goals are more widely recognized.

Deeper goals provide two key benefits: They help investors connect their financial goals to the bigger picture and they leave room for change. Connecting a person’s surface goals to their deeper goals helps weed out irrelevant goals and uncover opportunities. Once the two levels of goals are connected, it can be easy to see which surface goals aren’t contributing to a person’s life happiness.

An investor’s deeper goals can serve as a constant North Star, even when they go through unexpected life changes: a job loss, receiving an inheritance, or divorce. A deeper goal gives investors a more concrete idea of what they should be aiming for with their finances. The means of how to get there may need to adapt, but the deeper goal remains the same.

For example, consider an investor who wants to buy a beach house. That’s their surface goal. After a bit of conversation, say you uncover that the investor wants the beach house so they can have a go-to place for the family to gather—which means their deeper goal is really to have more time with their family. With this deeper goal in mind, more possibilities open. Maybe they can achieve this same goal in other ways, such as buying a more affordable lake house.

Or, say a client’s surface goal is to retire early. Upon further digging, you uncover that what they really want is to have more time to spend on their passion of volunteering for charity. Given this information, again, more possibilities open. Maybe instead of retiring early, your client can work part-time instead, which still offers them more free time (and happiness)—and they can have it now, instead of waiting 15 years.

How to Use the Positive Psychology Framework With Your Clients

It’s not easy to guide clients through the discovery process of uncovering both their surface and deeper goals. Luckily, advisors can lean on ready-made tools and frameworks to help clients identify both levels of goals. Based on our research, advisors can better discuss goals by working through them systematically:

  1. Start by helping clients uncover their surface goals. Past research suggests that many investors rely on top-of-mind goals during discussions and may need help getting to their true surface goals. We created a three-step exercise to help investors through this process.
  2. Now, it’s time to get to an investor’s deeper goals. For this step, we refer to the PERMA-V framework—a positive psychology framework that states well-being is composed of the following components: positive emotion, engagement, relationships, meaning, accomplishment, and vitality. In our research, we asked investors to consider each of these components and add any more goals that come to mind after going through a goal-setting exercise. Our findings suggest that using a positive psychology framework like PERMA-V may help give advisors insights into a person’s life values—the things that are at the core of their well-being and what makes them happy.

Our research finds that this approach is helpful for ensuring that investors aren’t just relying on their biases or thinking about their most pressing concerns when talking about goals. Moreover, using a positive psychology framework, such as PERMA-V, can guide people through the process of unpacking their motivations.

By first prompting investors with a checklist and then deepening the conversation with a meaningful framework, advisors can explore the specifics of what a client wants as well as the broader drivers underlying their desires. Such conversations can prepare advisors not just to get clients to where they want to go but also to help them be open to alternatives that may also suit their needs.

For this project, Morningstar worked with an unaffiliated wealth management firm, PWL Capital.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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About the Author

Samantha Lamas

Senior Behavioral Researcher
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Samantha Lamas is a behavioral researcher at Morningstar. She is a recipient of the Montgomery-Warschauer Award for her research in financial planning.

Lamas' research focuses on investor engagement and the factors that drive people's decision-making about investing and money. Her work delves into how people think about their financial goals, what they look for when seeking financial advice, and what kinds of mental shortcuts people use when making decisions about their personal finances.

Lamas joined Morningstar in 2016 as a product consultant working directly with the individual investor and advisor audience segments before moving into a research role.

Lamas holds a bachelor's degree in business with a concentration in finance from Dominican University. Follow Lamas on Twitter at @SamanthaLamas4 and on LinkedIn.

Email Samantha at

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