financial planning software

How Does It Sound Now?

© Can Stock Photo / merydolla

They say country music great Chet Atkins was playing a gig in a small Nashville club. After finishing a song, an audience member said “Man, that old guitar sounds great.” Atkins placed the guitar on its stand and replied, “How does it sound now?”

I’m reminded of this story as we review available technology for financial planning and investing. Some approaches to investing rely entirely on technology. Your supposed “risk tolerance” can be reduced to a number, which correlates to a pre-determined set of investments chosen by an algorithm, a computer program.

The financial planning process may be practiced on a robotic basis as well. One may enter data into a program or website, and get back a recommendation as to how much money must be saved or invested each month to reach one’s goals.

Oddly, sometimes even financial representatives function only as a conduit to get information from you to put into the machinery, and then deliver the outcome of the calculations back to you. The main function of the human in that case is to be a money-finder, not actually do any investment work or financial counseling.

Lots of colors in the pie chart and lots of pages in the financial plan can not replace the human touch. Understanding and clarifying what makes you tick, your purpose, your most heartfelt goals, these are things best left to real people. The dialogue, the discussion may be the most valuable part of the process.

Often we find many little things that might be improved by a slightly different approach. But few people care, unless they feel they are on track to meet the biggest thing on their list – their most cherished goal. It seems like the robotic approach has trouble understanding priorities.

I’m thinking that the guitar will always need a guitar player, and a usable financial plan will often need a planner. Of course we use technology to extend our reach and effectiveness, but its biggest blessing is in giving us more time to work with you, one on one.

Clients, if you would like to talk about this or anything else, please email us or call.


Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual..

All investing involves risk including loss of principal. No strategy assures success or protects against loss.