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How can you help clients find room in tight budgets for saving?

November 28, 2022 | Last updated on October 5, 2023
3 min read
Young couple getting advice from a financial expert around an office table
istock / Pekic


Inflation is increasing the price of almost everything in your clients’ budget, but the need to save for the future hasn’t gone away. Now is the time for advisors to step in with strategies that make spent dollars go further and open up space for saving. It’s the only way to keep long-term plans on track.

The challenge advisors face is that when clients have a comfortable margin between income and expenses, they often don’t pay as much attention to their budget. Spending a little more here and there doesn’t matter as much because they know they’ll be able to make ends meet.

However, in the current environment, many clients are covering higher costs with the same income and some may even be facing a shortfall. As a result, they’re starting to question every discretionary cost – and, for some, saving will fall into that category.

Unless advisors take action and help clients cut costs in other areas, saving may go on hiatus. When that happens, it obviously affects a client’s ability to meet long-term financial goals. It can also become an uphill battle to re-establish a commitment to saving even after conditions improve.

Tips to generate a surplus

Better cash flow management can often make significantly more room in a budget for saving. Quick tips you can share with your clients include:

  • Track expenses for a month to see exactly where money is going
  • Evaluate every cost to see if there’s a way to pay less for the same or similar value
  • Prioritize expenses and consider trimming costs in lower-priority areas
  • List needs and wants separately, and make sure saving makes the “needs” list
  • Bundle services together with one provider and negotiate a discount
  • Consolidate debt at a lower interest rate, and make paying off debt a “need,” too
  • Establish an emergency fund so clients don’t have to dip into savings to cover unexpected costs
  • Remember that budgeting is an ongoing process that must stay flexible to adjust to changing circumstances

It’s also important to let clients know that anytime they run into a cash flow crunch, you’re available to talk them through it and offer suggestions. Emphasize that making the best decisions in tough times helps to minimize the impact on the longer-term plans you’ve built together.

The fact is that, today, the most relevant financial education you can offer to clients relates to budgeting. It’s top of mind. It’s immediately impactful. It demonstrates the value you offer in a very concrete way, which solidifies client relationships.

It also opens the door to motivating conversations about saving any surplus. Encourage your clients to imagine a very specific picture of what they’re saving for. Steer them towards the experiences they’re dreaming of—for example, barbequing on a new deck steps away from a rippling koi pond, or sinking hands into clay in a pottery studio set up in the shed. Ask clients to describe the many aspects of their vision for the future in as much detail as possible. Then you can work together to save and invest towards them.

And where should you invest your clients’ savings in an environment of volatile markets and with a potential recession on the horizon? That’s the focus of the second article in this series.