Hierarchy of Our Identity

By Geoff Schaefer

Geoff is a Wealth Advisor with Intergy Private Wealth. He writes for The Steadfast Fiduciary to help people live with an abundant heart, open mind, and boundless generosity.

October 8, 2023

If financial planning were an objective practice, we could all use apps, AI, software, one day robots to help us make financial decisions.  The problem with this is that financial planning is not objective.  Now there are best practices and rules of thumb, but what works in one person’s situation may not work in another. Maximizing a tax benefit may come at the expense of liquidity and return potential can come in exchange for forgoing guarantees. While working with someone who can be as objective as humanly possible is important, the exact implementation of your plan is nuanced.  A point like this is an important one to truly identify who you are and why you are planning.

Ever gone to happy hour or a birthday party?  What is the first question you usually get after you’re introduced to someone? There could be several, but “What do you do for a living?” has to be in the top three.  While this isn’t bad at all, it does point to the idea that as people we put a lot of stock in our professions as a part of our identity.  On the other side of the conversation, we make a lot of assumptions about someone based on how they answer the question. Again, is this right or wrong?  No idea and not the point I’m trying to make. Put yourself back in the situation of giving the answer, for me it would be, “I’m a financial planner.” For others engineer, doctor, attorney, contractor, delivery person, a pilot, in sales, data analyst, and countless other careers.  Now, think about your life, is your career the first thing you think about when you wake up? When you ask yourself, “who am I?” Is your career the first thing that comes to mind? There are many that will answer yes, and that is great.  I believe we have callings and every career has the potential to serve others. Just think if the term “used car salesman” or “insurance agent” weren’t used in negative sense?  For others, there are probably a couple other terms that come to mind when we identify ourselves. Maybe parent, spouse, child, sports fan, biking enthusiast, alumni, collector, or student?  There is a long list there as well, but interestingly enough, you can think of a lot of associations to identify with that have nothing to do with work.

When financial planning, all of this should be taken into account. By prioritizing the way you see yourself, you are establishing a criteria for future financial planning decisions. I’m a husband and father and then a financial planner.  Would I give up my hobbies for my career? Likely.  Would I change careers if that decision was required for my family’s sake? Absolutely.

In financial planning, this can be used as a decision making framework.

  • Do I need to buy disability insurance? Does your core identity get disrupted if you can no longer bring in an income?
  • Should I invest cash or payoff debt? Which one allows for more time now, and in the future to pursue what truly matters.
  • Should I continued to work my 9-5 job or start my own business? There are trade-offs here for sure! At this point in your life, if your career is high up there, maybe you go for it. If your 9-5 affords you a lifestyle you enjoy and the chance to make every dance recital and basketball game, maybe the headache isn’t worth it.

The hierarchy isn’t meant to pigeonhole you into circles, but rather to free you to focus on the most important. There has been a lot of writing on the power of the word “no.” The best example of these writings is the idea that if a portion of your identity is the most important, than saying no to less important portions will free up the opportunity to say yes to something better.  By saying no to dinner meetings twice a week, I am saying yes to date night with my wife or freeze tag in the backyard with my kids.

We are all constantly changing in a world that is changing even faster. Our financial plans are in a state of flux and need to be anchored. There are a lot of ways to stay based, and maybe one to consider is to identify yourself with what truly matters to you. Maybe an opportunity for a great “yes” is around the corner.

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