Yorkshire Post - 10 Oct 2007
Contributor : Jonathan Fry

Money doesn't make you happy - how many times have you heard that said? The smart reply is, "No, but it helps." And no doubt it does.

There is perhaps a danger that the desire for money, for wealth, can become so consuming that we sacrfice our health, our relationships, the fundamental quality of our lifestyle. People have driven themselves to an early grave, seen destruction of their families, won and lost massively and have even gone to jail, all in the name of making money.

While those are extreme cases, it is my experience that many investors who have the means and the motivation to seek the help of a financial advisor do so with one intention - to ensure that their investments grow by the largest amount possible for the level of risk they are prepared to take. Protecting the real value of their capital over the longer term is an important priority.

I recently attended a three-day seminar in Zurich devoted to private banking and wealth preservation and came away with a reinforced conviciton that financial planning "is not about the money".

Many of the speakers from the leading investment banks focused on investment performance, and spoke about their sophisticated portfolio modelling techniques.

But perhaps the most interesting speaker was an American consultant who advises organisations which mange the wealth of higher net worth individuals.

His simple, but powerful conclusion, is that for the vast majority of people, financial planning should begin not with money, but the identification of what is important to us in our own lives. Once we have got the focus right, organise the money accordingly.

And what is important, surely, is not the quest for the most lucrative route to the continued expansion of our wealth, but about setting destinations - about deciding what kind of lifestyle we want for ourselves and our families. When we know what will make us happy we may be surprised to discover that it may not, in fact, be linked to making money.

So the first step to financial planning is to begin with the end in mind. Yes, we want to be financially secure, to provide for our families and to pay the least amount possible in taxes on our accumulated or inherited wealth.

But if we want to enjoy a fairly simple retirement, walking the Yorkshire Dales, having a nice meal out when we wish to and enjoying a decent holiday once or twice a year, we don't necessarily have to sacrifice what can be ours today in the race to achieve double the amount tomorrow.

The real danger is that we become busy fools, rushing after this or that without ever wondering why.

Increasingly, I am convinced of the need for individuals and families to have a trusted, independent financial planner, as opposed to taking "advise" from those whose interests are in selling particular products.

And my experience is that bringing together grandparents, parents and children to determine what is important to the family as a whole, in most cases will result in the desire for an on going quality of life and enjoyment of wealth far outstripping the imperative to make ever more money.

Identify the desired destination and the journey will become so much more fulfilling and rewarding.

To quote the stockmarket guru Warren Buffet, "it's the process not the proceeds".

© Yorkshire Post 2007