Policy-Based Financial Planning Provides Touchstone in a Turbulent World

The Journal of Financial Planning, p. 50, July 2006

7 Pages Posted: 13 Jun 2010

See all articles by Elissa Buie

Elissa Buie

Golden Gate University - Ageno School of Business

Dave Yeske

Golden Gate University - Ageno School of Business

Date Written: July 14, 2006

Abstract

Although planning policies are often implicit in the recommendations that financial planners provide their clients, taking the next step and transforming these into formal written statements can better help clients stay the course in an uncertain world. This article advances a framework for how planners might formulate such written policies.

The ideal policy will be broad enough to encompass new or unexpected events, yet specific enough to minimize doubt as to what action to take in response to changing circumstances. Using the Integral framework, within which clients are viewed from the fourfold perspective of individual/interior, individual/exterior, collective/interior, and collective/exterior, can be very helpful when developing formal planning policies.

The article provides several examples of financial planning policies developed using the integral framework.

A six-step process is suggested for formulating policies that bridge interior client goals and values to concrete exterior actions. The steps include identifying planning areas relevant to each objective, crafting statements that capture the client goals and planning principles, using scenario planning to test the policies, and updating the policies.

An extended case study shows an initial policy, a revised policy five years later as client circumstances change, and how the policy keeps the clients on course.

In addition to giving clients a sense of control amidst the daily barrage of "noise," this policy-based approach can be very helpful to clients who use planners only on an as needed basis, and to young people whose biggest planning decisions have yet to come.

Keywords: Policy, Policy-Based Financial Planning, Financial Planning, Policies, Strategy, Strategies, Personal Finance

JEL Classification: D1, D11, D12

Suggested Citation

Buie, Elissa and Yeske, David, Policy-Based Financial Planning Provides Touchstone in a Turbulent World (July 14, 2006). The Journal of Financial Planning, p. 50, July 2006, Available at SSRN: https://ssrn.com/abstract=1624303

Elissa Buie

Golden Gate University - Ageno School of Business ( email )

536 Mission Street
San Francisco, CA 94105
United States

HOME PAGE: http://www.yebu.com

David Yeske (Contact Author)

Golden Gate University - Ageno School of Business ( email )

536 Mission Street
Room 4332
San Francisco, CA 94105
United States
415-442-6524 (Phone)

HOME PAGE: http://www.yebu.com/about/dr-dave/

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
406
Abstract Views
2,868
rank
91,575
PlumX Metrics