Holistic Financial Life Planning

Holistic Financial Life Planning

Hand is writing Holistic approach on a note.

Chapter 1

What is a financial life planning (holistic) approach to your money and your life?

You may have heard the term “holistic” financial planning batted around in recent years. What exactly is it, and why has it become a popular concept? In this guide, we’ll define holistic financial planning, and why it might make sense considering for you.

Financial life planning focuses on examining how your financial goals interact with your overall life goals, with the objective of harmonizing the two. Rather than simply asking how much money you need at a certain point in time, it involves asking why you need the money, and how achieving a financial goal will help you achieve a life goal. 

The premise behind this approach is that money is a tool to be used to enable you to live life the way you want and that your financial planning should consider the qualitative aspects, rather than just the quantitative aspects, of achieving goals. The focus is on prioritizing goals that are not simply financial but will also boost your well-being. 

Such an approach typically involves working with your financial advisor to analyze your current financial situation, goals, priorities, and wishes. From these elements, a holistic financial plan can be created with the objective of enabling you to live a life that is both rewarding and meaningful. The idea is to discover what goals are most vital to your overall well-being and to find the best way to achieve them in accordance with the available financial resources.

Chapter 2

Differences between financial life planning and financial planning

financial goals depicted as icons over stacks of coinsWhile financial planning asks the question how much do I need to achieve a particular financial goal, financial life planning asks how does achieving that financial goal impact my life? It provides a framework for aligning spending and savings goals with values that are actually important to you and your family. 

For example, if you determine that purchasing a house in a certain area requires saving a substantial sum of money for a down payment, a financial life planner will ask how important it is to you to live in that area. If it is very important, then saving the amount necessary for a down payment on a house there makes sense. If not, then it may be preferable to direct those funds elsewhere.

The same might apply to saving for retirement. A typical saver must allocate a little bit of money over many years to achieve a retirement nest egg. A life planning approach takes a different perspective to simply calculating how much you’d need to save each paycheck. Financial life planning involves digging deeper into your values; questioning, for example, how much you are willing to sacrifice today for future savings. 

The answer to questions like where to live and how much to save varies from individual to individual, so simply following the standard financial planning advice may not be right for you. Financial life planning understands that a cookie-cutter approach doesn’t work for everyone – it acknowledges and accommodates the fact that different people will have very different preferences when it comes to lifestyle and savings approaches. 

As a holistic approach, financial life planning stresses the importance of considering how your financial goals function within the context of your life as a whole. This reflects the reality that saving for one goal may make it difficult or even impossible to save for another goal. This speaks to the need to prioritize different goals and evaluate how they impact each other. 

While financial planning focuses on the numbers underlying your goals, financial life planning looks at qualitative measures, emphasizing the human element. Rather than solely computing projections, financial life planning looks beyond the numbers to see how they will impact your life. It also identifies specific goals that should be prioritized, and strategizes methods for removing obstacles that might be in your way.

One way financial life planning is different from traditional financial planning is the use of a top-down, rather than a bottom-up approach. This means that instead of focusing on a specific aspect of your finances, you and your planner will start with a broad focus on your overall objectives and proceed to individual goal planning. From there, you and your advisor can devise a custom plan for managing your finances.

Chapter 3

How values shape your financial planning

Money is an integral part of many aspects of our lives. Thus, it’s no surprise that your values, the principles that ultimately drive your worldview, play an integral part in holistic financial planning. Your values help you identify what is most important to you, and should ultimately drive what the plan should “solve for.”

If you value family as a top priority, how does that influence your financial plan? Perhaps it means purchasing a home near your adult children in retirement or sacrificing other “wants” in order to set aside money to pay for a child’s college education. 

If your values drive you to donate to charity, how does that impact your overall spending? If you highly value financial independence, how does that affect your choice of employment and saving plans? Questions like this influence actions you might take both today and for the future – and they can only be uncovered with a deep conversation.

A major values-driven aspect of financial planning involves the tradeoff between time spent working and doing other things – being with family and friends, pursuing hobbies, traveling the world, etc. Because your values drive your satisfaction, the amount of money you are content with may differ widely from someone else. Some people may find contentment in non-material pursuits, such as communing with nature. Others may value the peace of mind that comes with being debt-free, no matter how small the debt.  

There is no right or wrong answer to the amount of and approach to money a person needs to feel content – the key is to find the formula for matching money and values that works for you. Two people might earn the exact same income, with one satisfied with what they earn while the other individual feels it is not enough. 

If we look at their values, we can get a better understanding of an individual’s attitude towards money. The reason is that our values provide motivation, and money provides the fuel that we can combine with motivation to achieve goals. 

Our values help us pick what to do. While money can be a part of the how, it can’t determine what we want – that ultimately depends on our values. The key to financial life planning is to keep the two in alignment – what you spend your money on and what you value. When they are not in sync, the result is likely to be disappointment and frustration. Financial contentment increases when your money-life connection or put in a different way: your values, financial priorities, and goals coincide.

Chapter 4

How money plays a role in life planning

Because money is inextricably linked to so many aspects of a person’s life, it plays an integral role in life planning. This is not to say it must always play the dominant role – money provides the fuel which makes many goals possible, but life planning is careful to stress that money itself is not the goal. 

Thus, life planning focuses on determining how money affects your ability to live the lifestyle of your choice. This doesn’t mean that a lack of money means that you can’t pursue the type of life you want to lead, but it does inform how you plan to live that life. For example, if you love to travel, but also highly value your children’s education, you may need to plan for less expensive trips in order to fund both priorities. 

Father And Daughter Putting Pocket Money Into Savings Jar On Kitchen CounterThe way we feel about money and how we use it is heavily influenced by the messages about money we encounter throughout our lives. This includes both what we hear about money and its use and money-related behaviors we observe.  

If you think about your attitude towards money, you can likely trace at least some aspects of it back to your childhood years. If your parents were extremely frugal, how might that affect you? What if they were spendthrifts? What if you had friends who worked hard and saved their money? How about if your friends spent their money as soon as they earned it? Understanding the factors underlying your views about and approach to money can be helpful in adjusting your approach if doing so is necessary to improve your financial health.

Chapter 5

How visualization can help you reach your financial goals

There is an old saying: where the mind goes, the body will follow. This adage can be expanded and applied to achieving goals through the process of visualization. At a simple level, if you think to yourself, “I’m thirsty,” the likely next step is to reach out with your arm and grab a drink. Analogously, if you think about achieving a financial goal such as saving money to make a major purchase, this can help pave the way to reaching it.

Clearly, achieving a financial goal is a more complex process than grabbing a glass of water. Therefore, to be as helpful as possible, the visualization process should involve more than simply acknowledging a goal. 

In sports, where visualization training is increasingly used, an athlete will imagine performing the various physical steps required to successfully complete a task – kicking a ball, catching a pass, throwing a pitch, etc. The athlete then visualizes the results of successfully performing the necessary routines – a goal, basket, strikeout, and, ultimately, victory, using the positive emotion this generates to motivate skillful performance of the steps leading to that result.

In financial planning, you might visualize yourself taking the steps necessary to achieve a goal (such as saving for retirement) by going over the things you need to do at work to generate the income to set aside for this purpose. 

Additionally, similar to an athlete envisioning victory, it helps to visualize yourself in retirement living the life of your dreams. Where will you be? What can you touch, taste, feel, and experience as you are achieving this goal? Actually describing the vision creates positive emotion, which can help motivate you to take action to fulfill that dream.

Visualization exercise can help pinpoint what it is about a goal that is most important to you. That, in turn, makes it easier to determine what you need to do to attain the type of future lifestyle you want. Once you know this, you can prioritize achieving the goals that are most important to you.

Chapter 6

The importance of goal setting / a goals-based approach

Words my goals on notebook with three darts on bullseye target in dartboard backgroundWhile stressing the value of incorporating overall quality of life issues within the scope of your financial planning, holistic life planning also emphasizes the importance of setting goals. It’s hard to achieve goals, but it can be just as challenging to know what those goals are. Although it might be difficult, it is critical to identify your goals to make sure that your money serves you and your values (and not the other way around!)

For instance, if you want to retire someday but don’t make any plans to be able to do so, retirement becomes a wish instead of a goal. This isn’t to say that you won’t be able to retire at some point, but without taking a serious look at your retirement plan, your retirement lifestyle may not meet your expectations. 

The point is that just saving money in and of itself may not be enough– you need to know how much you need to save, which will also enable you and your financial advisor to determine what type of investment strategy is most appropriate.

Chapter 7

Going through transitions

Change can be difficult, and this is especially true of major life transitions. Besides the emotional and strategic challenges they can present, transitions also require careful financial planning. Raising kids brings with it a different set of financial demands and circumstances, as does leaving the working world and entering retirement.   

When at a crossroads of a major life transition, it’s critical to prepare. For example, once you retire, what will you do with your time? Now that you’re married, how will things be different? Financial life planning is designed to help you effectively navigate these transitions by identifying steps you can take to surmount the challenges they represent. Most major life transitions have a financial component, so planning ahead to deal with them is vital to handling them smoothly.

Chapter 8

Choosing the right financial advisor for YOU

While there are numerous financial advisors out there with extensive training and experience, how do you sort through them to find the advisor who is right for you? An important first step, if you’re interested in developing and implementing financial plans that take into account your overall life goals and financial situation, is to look for an advisor who focuses on financial life planning. 

Such an advisor can help you take a holistic approach to your finances, helping you harmoniously integrate your financial goals with your life goals. It’s also important to look for an advisor with the training to help you thoroughly analyze all aspects of your financial life. In this regard, a CERTIFIED FINANCIAL PLANNER™ Professional can be of assistance. To earn this designation, an advisor must pass a rigorous series of tests proving their comprehensive knowledge of financial planning principles and techniques.

It is also important to look for an advisor who is considered a fiduciary, meaning that they must consider what is in your best interest first at all times when offering financial advice. This is generally considered a more rigorous standard than the “suitability” guidelines that apply to financial salespeople such as many stockbrokers or registered representatives.

In the process of creating a durable financial plan to attain your financial and life goals, you may benefit from working with a CERTIFIED FINANCIAL PLANNER™ Professional who is subject to the fiduciary standard and should dedicate the time necessary to understand your goals and what drives them. Learning about your financial circumstances, aspirations and financial concerns prepares your financial advisor to provide you with advice that takes into account the qualitative factors that are so important to drawing up a holistic plan.

To help you achieve the goals that matter to you, a financial life advisor will examine your approach to money and how that impacts your financial situation. This helps your advisor truly understand your goals in order to help you figure out how to overcome challenges, successfully navigate life transitions, and constructively deal with money-related aspects of life. To accomplish this, your planner should be able to help you draw up a holistic financial plan that integrates your life goals with your finances in the most productive way possible, both currently and in the future. 

By taking the time to learn about what is important to you, a financial life planning advisor can understand your unique situation with regard to your aspirations, priorities, and challenges and use this information to provide you with advice customized to your unique circumstances. 

Your financial advisor should be able to help you develop a plan for building wealth by saving, paying off debt and investing your savings. A life planning advisor can help you build a holistic plan that incorporates your values and your preferred approach to money, with goals prioritized to enrich your life.  

The advisor should be able to use their training and resources available to both evaluate your finances quantitatively and to look at your efforts from a qualitative standpoint. In doing so, they can help you identify and clarify the values underlying your goals and how those goals can bring meaning to your life and help you live the lifestyle you want to live.

Chapter 9

Connecting money to your life

Mature grandparents playing with grandchildren and having fun with familyThe rising popularity of financial life planning stems from the realization that a narrow focus on amassing money misses the bigger picture that money is just a means to an end. That end, or goal, is to enable you to live your life the way you want to live it. Working with a CERTIFIED FINANCIAL PLANNER™ Professional who takes this approach, such as the professionals at Prism Planning Partners,  can help you link your finances to doing what makes you happy – and to structure your life and money-making activities in a way that supports your ability to spend time doing what you like to do. 

A CERTIFIED FINANCIAL PLANNER™ Professional who focuses on holistic planning can show you how each piece of the financial puzzle affects every other piece and your finances as a whole. By doing so, your advisor can highlight the different tradeoffs and impacts of your financial decisions. The decisions are yours to make, but by clearly outlining how your financial decisions will impact your ability to achieve your goals, your advisor can make the planning process more effective than it would be if goals were considered in isolation. 

This comprehensive process can help you plan for any goal with a financial component, including:

  • Saving for retirement
  • Saving for a major purchase
  • Paying down debt
  • Evaluating insurance needs for:
    • Life
    • Disability
    • Health
    • Long-term care 
  • Evaluating investment approaches using investment vehicles such as:
  • Tax planning
  • Educational planning
  • Estate planning 

Each of these elements is subject to inclusion under a holistic planning process, which focuses on integrating them into a cohesive plan that helps you prioritize your goals to enable you to live the lifestyle of your choice in accordance with your financial means.

Working with a CERTIFIED FINANCIAL PLANNER™ Professional who focuses on financial life planning helps you take a holistic approach to evaluating your goals, how close you are to attaining them, and what you can do to improve your chances of reaching them. Taking such an approach enables you to be confident in your financial plan by helping you find optimal solutions for achieving your most important life goals.


At Prism Planning Partners, we are CERTIFIED FINANCIAL PLANNER™ Professionals committed to facilitating important questions so that we can help you explore all of your opportunities. We offer a broad array of financial planning and consulting services for our clients-including retirement, investment, and estate planning.

Contact us today and let us illuminate your possibilities!

Prism Planning Partners, LLC dba Prism Planning Partners is a Registered Investment Adviser. This article was produced by Paladin Digital Marketing, an entity unrelated to Prism Planning Partners and may not necessarily reflect the expertise of this financial advisor. This publication is not intended to provide investment advice and is intended for your information only. Opinions and forward-looking statements expressed are subject to change without notice. Information based upon third-party sources and data are believed to be accurate and reliable, but we do not warrant or guarantee the timeliness or accuracy of this information. All domestic and international rights are reserved. No part of this publication including text, graphics, et al, may be reproduced or copied in any format, electronic, print, et al, without written consent from Prism Planning Partners. Neither Prism Planning Partners, nor its investment advisor representatives provide legal or tax advice. Please be advised to consult your investment advisor, attorney or tax professional before making any investment decisions. 

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