When client uncertainty stems from disagreements about household costs

Most conflicts I’ve seen between couples in the office involve understanding what it costs to run the household. I think one person may look after certain expenses and one person looks after other expenses, and sometimes there is not a clear understanding of the full picture. That’s where, “Oh, we don’t need that amount of coverage” or “We need more coverage” comes from.

To manage that, when we do the initial plan, we make sure we do a budget and know what their spending is like so we can come back to that budget and say, “We did a budget when we did your wealth planning and your wealth accumulation planning. This is what you’ve got right now, this is what you’re willing to save. If that X amount is what we have insured, then we’re just going to have to cut this budget down. So let’s just sit here and talk about this amount in a meaningful way and cut the budget down to see if that amount of coverage is right.”

When you take it off the back and forth between our lifestyle expenses and bring it down to real numbers, it diffuses that argument and it brings attention to what we really need and what we would cut. Then you’re talking about real things. Because when you talk about cutting the amount in half, that can happen on paper, but what does it mean for the real picture?

Dana Mitchell, CLU, CFP, is a five-year MDRT member from Toronto, Ontario, Canada. Hear more in the June episode of the MDRT Podcast: