In the first 10 minutes of a meeting, your client says:
“Out of the blue, my husband, John, surprised us all with tickets to Oktoberfest. We flew his parents, his sister and the kids for a week in Munich!”
When John leaves the meeting to take a call, your client adds:
“I’m worried about his generosity. He delights in giving extravagant gifts, but then the bills arrive and the next few months we’re juggling credit cards to make ends meet.”
At that moment
- Tell your client it’s important that the three of you discuss this issue openly. Remind her you’ll give objective financial advice and won’t take sides. Ask her to open up the conversation when John returns.
Later in the meeting
- If she’s comfortable doing so, she should repeat what she told you when her husband returns. Both the client and John should have equal time to speak, directed at one another, while you listen.
- If John gets defensive, remind him that your job is not to give him a lecture but to help him make the best possible decisions with his money. Assure them that you want to find a solution they’re both comfortable with.
- For your next meeting, offer to review their portfolio to see what portion of their income is actually discretionary.
- Also offer to model how saving some or all of the money John spends on gifts could add up over time.
At your next meeting
- Present your findings and calculations, ask for their feedback, and be prepared with some suggestions that allow John to be generous within his means. He could contribute to his nieces’ education funds, for example, or treat them all to a night out on the town.
- Offer to create a budget that fits both your client’s and her husband’s goals, and to update and review that budget regularly.
Over the long term
- If you notice John’s spending continues to impact his life or marriage, consider tactfully bringing this up with him. He might struggle with impulse control or with adhering to a budget. You can help him understand his behaviour or suggest ways to seek help if needed.