Last week we compared home mortgages, and this week we’re going to turn to something more conceptual again. We’ve talked about the Principles for Prosperity, so how do we break down what really sets the movement apart? What is Prosperity Economics?
Prosperity Economics is a paradigm shift, totally different from the mindset that typical financial planning builds from.
Typical Financial Planning…meets needs and goals only.
It’s based on limited ideas of “what you can afford.” It keeps you where you are.
Prosperity Economics…pursues wants and dreams.
It’s based on unlimited ideas of “what is possible?” It brings momentum!
Typical Financial Planning…minimizes requirements.
“How much do I have to save?”
Prosperity Economics…optimizes opportunities.
“How else can I build wealth?”
Typical Financial Planning…is product oriented.
Planners depend on what you buy. The focus is on buying certain products to further your goals.
Prosperity Economics…is strategy oriented.
The focus is on what your client can do and how to do it—based on time-tested principles and financial philosophies used to build wealth.
Typical Financial Planning…is focused on the rate of return.
“How much is this earning me?”
Prosperity Economics…is focused on recovering opportunity costs.
When your client keeps more money working for them, opportunity cost decreases.
Typical Financial Planning…puts institutions in control of the client’s money.
Your assets are put “under management” and/or control is given to the government.
Prosperity Economics…gives your client the reigns when it comes to their money.
They maintain responsibility for and access to their assets and funds.
Typical Financial Planning…is micro (vacuum) based.
The focus is on the client’s “portfolio.”
Prosperity Economics…focuses on the macro (big-picture).
Your client’s whole personal economy is taken into account.
Typical Financial Planning…makes Net Worth the measurement of success.
A bigger portfolio is the goal.
Prosperity Economics…makes Cash Flow the measurement of success.
The goal is more money to enjoy each month.
Typical Financial Planning…is retirement-oriented.
Your client’s reward for a lifetime of working is not working.
Prosperity Economics…is focused on abundance, freedom, and contribution.
Help your client enjoy their work and their life—all life-long.
Typical Financial Planning…asks clients to live only on interest.
Your client’s income is at the mercy of interest rates, with fingers crossed they won’t need to use principle.
Prosperity Economics…teaches to spend and replace principle.
Assist your client in cultivating a flexible, sustainable way to live.
Typical Financial Planning…has clients keep their money still.
Assets are accumulated into accounts where they sit, financially “stagnant.”
Prosperity Economics…encourages clients to move their money!
Your client’s personal economy is alive and well; money flows in and out of their accounts.
Typical Financial Planning…assigns only one job to your client’s dollars.
Clients are encouraged to save separately for emergencies, education, retirement, and major purchases. They are taught to spend each dollar for one purpose only.
Prosperity Economics…puts your client’s dollars to work in multiple jobs.
Dollars are used for flexible and multiple purposes.
Typical Financial Planning…dubs the professional planner as the expert.
Finances are represented as something confusing that should be delegated. All control is in the hands of someone other than the client.
Prosperity Economics…empowers clients.
Money is demystified for them. An education-based approach builds financial confidence and allows the client to implement strategies. When your client is empowered, it builds trust between you and the client–they know what’s happening with their money because you help them to understand. There’s no curtain for them to pull back, so they can be confident in you and their finances.
The root of Prosperity Economics is empowerment. It empowers you as the advisor to offer strategies to your clients that they can use for a lifetime. It empowers your client to be in control of their choices, and you become their partner rather than their manager.
Consider the ways that Prosperity Economics can help your clients not only understand their money but actively work with you to achieve their desires? With a prosperity mindset, everyone can win.
Our next post in the series will be another deep dive into how you can combine the Truth Concepts software with Prosperity Economics.