How George Kinder's Life Planning Philosophy Helps BKFi Clients Achieve Financial Independence

Financial independence is not just about amassing wealth; it's about using that wealth to create a life that aligns with your deepest aspirations and values. George Kinder, a renowned financial planner and author, introduced the Life Planning philosophy, a profound approach to financial goal setting that goes beyond the numbers. In this blog post, we'll delve into George Kinder's Life Planning philosophy and explore how it can benefit anyone on their journey to financial freedom. George Kinder is a respected thought leader and his approach to financial planning has helped hundreds of advisors and tens of thousands of clients achieve their best lives. I benefited personally from Kinder’s philosophy and was lucky enough to travel to Hana, Hawaii to spend a week with my business partner Shane and about a dozen others. I got clarity into my life goals and my true “purpose,” which has led to better decision-making and generally better alignment between happiness and wealth building. Shane and I incorporated the things we learned from George in Hawaii into our financial planning process here at BKFi. Our financial planners kick off all relationships with a series of questions to help them connect with our clients. Here’s a sneak peak into those questions.

 

AJ and Shane on the Road to Hana to see George Kinder

 

Question 1: The Freedom Question

The first question in George Kinder's Life Planning philosophy is the Freedom Question: “I want you to imagine that you are financially secure, that you have enough money to take care of your needs, now and in the future. The question is…how would you live your life? Would you change anything? Let yourself go. Don’t hold back on your dreams.”

This question prompts you to envision a life without financial constraints. It encourages you to think about your passions, values, and aspirations. Whether it's pursuing a new career, traveling the world, or dedicating more time to family, this question helps you define your vision of a fulfilling life.

Question 2: The Clarity Question

The second question is the clarity question: "You visit your doctor who tells you that you have only 5 – 10 years left to live. The good part is that you won’t ever feel sick. The bad news is that you will have no notice of the moment of your death. What will you do in the time you have remaining to live? Will you change your life and how will you do it?”

The Clarity Question brings your vision of financial freedom closer to reality. It helps you understand the emotional and psychological impact of financial security. By envisioning the freedom from financial stress and the confidence that comes with it, you can connect with the deeper emotions associated with your goals.

Question 3: The Reality Question

The third question, the Reality Question, brings the philosophy full circle: "This time your doctor shocks you with the news that you have only one day left to live. Notice what feelings arise as you confront your very real mortality. What did you miss? Who did you not get to be? What did you not get to do?"

This question may seem stark, but it's a crucial part of the Life Planning process. It compels you to consider the consequences of not pursuing your life's most important goals. By reflecting on what you might regret if you don't take action, you can gain clarity on your priorities and avoid the trap of deferring your dreams indefinitely.

 

Life Planning, Stock Options, and Taxes

One thing we struggled with was how to connect this “woo woo” philosophy with the practical realities of our clients, many of whom have to make urgent and impactful decisions around their equity compensation. What does a life philosophy have to do with tax planning, you might ask? 

Applying George Kinder's three questions to stock options planning involves using a holistic life-planning approach to make important decisions that will have a lasting impact.

Question 1: The Freedom Question

Consider how stock options fit into your overall financial and life goals. Instead of solely focusing on the financial aspects, think about what achieving your goals would mean for your life. For example:

  • How would exercising or selling your stock options impact your lifestyle and financial freedom?

  • Would it allow you to pursue your passions, like starting a business or traveling the world?

  • Are there charitable causes or educational endeavors you're passionate about that your stock options could support?

Question 2: The Clarity Question

Application to Stock Options Planning: Imagine a scenario where your stock options have not only met but exceeded your financial goals. Consider how you'd feel and what actions you'd take:

  • Would you be more inclined to exercise your options sooner to lock in gains, or would you continue to hold for potential future growth?

  • How would the emotional clarity of knowing your financial goals are secure influence your decision-making regarding stock options?

Question 3: The Reality Question

In this context, think about the potential regrets you might have if you don’t make the right decision.

  • Are there opportunities you might miss if you don't exercise or diversify your stock options?

  • Would you regret not using your stock options to secure your family's financial future or support causes you care deeply about?

  • How would the fear of missing out on potential financial security or growth impact your decisions regarding your stock options?

Here are the benefits of Life Planning:

Alignment of Financial Goals and Life Vision: George Kinder's Life Planning philosophy allows you to align your financial goals with your life's deeper purpose. It ensures that your pursuit of financial independence is driven by a clear vision of the life you desire.

Emotional Connection: By addressing the emotional aspects of financial planning, the philosophy helps you connect deeply with your goals. This emotional connection serves as a powerful motivator, keeping you committed to your financial plan.

Avoiding Regrets: The Reality Question prompts you to take action and avoid regrets. It encourages you to prioritize your most important goals and not put them off indefinitely.

George Kinder's Life Planning philosophy transcends traditional financial planning by focusing on the deeper meaning and purpose behind financial goals. Whether you're aiming for financial independence or simply seeking a more meaningful relationship with your finances, this approach empowers you to define your vision of a fulfilling life, gain emotional clarity, and take action to achieve your financial aspirations. By answering these three fundamental questions, you can navigate your financial journey with purpose and confidence.

AJ Grossan