Did you know that the financial planning industry has been around for less than 50 years!? In the span of just a few decades, the industry has had great influence on how people approach their money, where and how they save and invest.
Is this a good thing? Well, yes and no. Today, we give a bit of history and revisit some video interviews with Kim Butler, co-founder of the Prosperity Economics™ Movement. You’ll get an overview of financial planning and also Prosperity Economics™—the solution for typical financial planning!
How Financial Planning Began
According to “A Concise History of the Financial Planning Profession” on the website of the Financial Planning Association, the financial planning industry was conceived in a December 12, 1969 meeting of 13 financial service industry leaders at a hotel near Chicago’s O’Hare airport. They were gathered together by Loren Dunton, a sales trainer from various industries who had recently authored a book called How to sell Mutual Funds to Women. The country was in a recession, and according to Dunton.org, those who gathered were “financial product and service salesmen… driven to find a solution” to the financial challenges faced by Americans, including those in the financial industry.
An organization grew out of that meeting that would eventually be called the International Association for Financial Planning (IAFP), with an educational arm that would become the College for Financial Planning. The first CFP class graduated in 1973—only 45 years ago. Those completing the curriculum and passing the exam earned the CFP® (Certified Financial Planner) designation, as Butler once did.
Although one of the financial planning industry’s worthy goals would be to shift the financial industry’s focus from the latest financial products to financial education and the investors themselves, the industry has always had certain blind spots. The CFP curriculum revolves around how to plan for insurance, investments, taxes, employee benefits, retirement, and estate planning. However, it barely touches on the two economic forces responsible for creating the majority of wealth: entrepreneurship and real estate investment. In this way, financial planners are trained to focus on solutions put forth by large brokerage firms and banks more so than other proven, traditional building blocks of wealth. In similar fashion, we see doctors learn more about prescribing medications from pharmaceutical companies than about nutrition, exercise, and stress reduction—the actual building blocks of health. As a result, those attempting to build wealth—or health—are advised to delegate control to those with vested interests.
We are grateful that financial planning encourages people to save and invest—of course they are much better off when they do! But there are also downsides to typical financial advice and financial planning. For instance, the notion that you can effectively “plan” for an unpredictable future actually gives investors a false sense of security. Kim explains this to industry colleague Steve Savant in this interview on “Why Financial Planning Doesn’t Work”:
There are other downsides as well, such as misleading math, exposure to volatile markets, and assumptions that more risk will surely equal more reward. Many Americans are saving in their 401(k)s and other qualified retirement plans, crossing their fingers it will be “enough.” Meanwhile, even those considered relatively wealthy are often unsure how to grow their assets while protecting them from market instabilities.
The Prosperity Economics™ Solution
If financial planning is problematic, what then is the best way to attain economic freedom and prosperity?
Prosperity Economics™ offers a way out of the mess. It offers a total paradigm shift about wealth-building. Prosperity Economics™ questions the financial assumptions we’ve come to accept as true and provides an alternative to “typical” financial planning.
While sometimes hailed as the latest trend in personal finances, Prosperity Economics™ hasn’t been so much discovered as rediscovered. It employs common-sense principles and strategies that preceded the rise of 401ks and the financial planning industry. Prosperity Economics™ shows you how to optimize wealth by keeping it in your control rather than delegating your financial future to Wall Street, big corporations, and the government.
As a matter of fact, “Control” is one the 7 Principles of Prosperity.™ Kim explains all seven to Steve in the interview below, “The New Prosperity Economics™.”
How to Apply Prosperity Economics™ to Your Finances
Want to learn more about Prosperity Economics™ and the Prosperity Economics™ Movement? You’ll find more distinctions between financial planning and Prosperity Economics™ (including a handy chart) on our home page.
There IS a better way than guessing your way to wealth and subjecting your dollars to the ups and downs of the stock market! Find out how Prosperity Economics™ can help YOU experience more wealth and less worry. Contact the agent or advisor who sent you here, or contact the Prosperity Economics™ Movement at hello@pem.email.
