What is a Financial Wheel?

The purpose of this video is to share an overview of the Financial Wheel and how we use the tool during the Discovery Meeting.

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Hi! I’m Stu, here at TwoTen Planning.

The purpose of this video is to walk you through an exercise that I will often do with new clients during the Discovery meeting, which is the second meeting in our new client onboarding process.

The benefit to watching this is you will get a peek into what part of the Discovery Meeting conversation looks like, and it will provide you with an understanding of how we help clients evaluate their current financial satisfaction, while identifying financial areas in need of improvement.

First, I’m going to provide you with an overview of the Financial Wheel itself, and then show you a sample of a completed Financial Wheel. Then I will provide you with some context of how it can be applied.

Ok, this is the tool. It’s called the Financial Wheel. You’ll notice there are 8 categories listed on the wheel, which are financial areas of your life. If there happens to be a category that is relevant to you, but not listed, feel free to add it to the wheel. It’s your Financial Wheel!

The nice thing about this tool is that you can use it as an assessment for where you are right now, and to target where you want to go.  Let’s first use it as an assessment for right now. And because of this, I believe the financial wheel is best used by completing it individually, not jointly as a couple. I’ll talk more about this in a bit.

For each financial category rate your level of current satisfaction on a scale of 1-10 (10 is very satisfied; 1 is not satisfied at all).  It’s important to note that it’s not whether you currently have the item or not, or where you would like your satisfaction to be, but it’s how satisfied you are currently with that category. When you select your number, draw a thick line and shade below it.

In our Discovery meeting with a couple, for example, I will typically ask each person to look at their wheel and talk about what they notice. What do you observe? If you were going to focus on one or two of the most important categories right now and create a path forward, which would they be, and why?

These questions open a productive conversation about the person’s view of money, why and where they formed a certain money belief, why they behave a certain way with money, or what’s important to them about money.

Then we can gently move from the present, and extend our focus to the future, by asking “Where would you like the number for that category to be? What would that be like? What would that do for you or mean to you? And what would it take to bring your satisfaction up to that level?”

So, these are some questions that can help to facilitate a healthy conversation about your current financial life satisfaction and start pondering what it could look like, and what it might take to get there. 

I mentioned briefly that I encourage spouses to complete the financial wheel separately. In everyday life, we often make a lot of assumptions about our spouse’s satisfaction level within each category. We assume their satisfaction level is the same as ours. Or we don’t think about our spouse’s financial satisfaction at all, and we never bother to ask! And in some cases, neither spouse has ever thought about their satisfaction regarding these categories. It might be their first time reflecting on it. Unfortunately, spousal conversations about money can often be the source of great disagreement and turmoil.

But when we observe, listen, and show genuine curiosity about each other’s wheel, it can reveal new insights about the other person's view on certain categories. The conversation may go in all kinds of different directions. It might be the first time the couple ever had a face-to-face discussion about their financial views. Often, one spouse will look at the other and say, “Wow, I never knew that about you before,” or “I had no idea you felt that way.” Sometimes tears are shed.

But this is also where breakthroughs happen. Some of these feelings may have been kept dormant for years, and now come to the surface. Simple awareness can be eye opening. 

And this exercise can stimulate new and healthy spousal conversations about money. Spouses start to listen and understand what’s important about money to themselves and to each other, instead of bickering, fighting, or even resenting the other.

When we pivot to focus on identifying areas of improvement, this is often the beginning of realizing where your true financial priorities exist. It becomes a launching point for financial goal setting. But until the person completes the wheel and reflects on it, they might never have previously realized that a certain category was going to become a priority. Simply having the conversation can unlock new possibilities – and this is the beauty of real financial planning!

As a quick recap, the purpose of this video is to share the Financial Wheel and how we use the tool during the Discovery Meeting. I hope you’ve enjoyed getting a glimpse of the Discovery conversation, how we help clients rate their current financial satisfaction, and how we identify financial areas of improvement.

If you would like to learn more about working with us, visit TwoTenPlanning.com and hit the Free Assessment button to set up your Intro Visit today!

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The foregoing content reflects the opinions of TwoTen Planning and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as financial, legal, tax, or investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. All investing involves risk, including the potential for loss of principal. There is no guarantee or assurance that diversification, strategies based on Nobel prize-winning research, or any investment plan or strategy will be successful. Consult an estate attorney or qualified tax professional for specific advice relating to those respective areas.