Financial Planning For End-of-Life: Perspective is Everything

DECEMBER 04, 2016
McLarson MD

Thanks to Dr WiseMoney's work known as the Physician Support Initiative, I was privileged to hear a talk from a financial planner that specialized in helping doctors reach their financial goals. He said something that I wasn't expecting, at least not from a certified financial planner. He said we should spend more time and money on vacations, even during residency. I guess I was expecting to hear something more like "don't spend" rather than spend more...

The financial planner explained how spending more on making memories with loved ones was invaluable, and that the relationships with loved ones would be worth far more than whatever wealth we had accumulated when we reached the end of this life.

He has a point. With the unexpected passing of Dr WiseMoney and the refreshed perspective on how end-of-life is really an unknown variable this advice seems perfectly sound. After all, there are latent or potential costs of not having a good work-life balance and poor interpersonal relationships. The costs associated with feeling unbalanced, unsupported, or alone (in other words, depressed) include both financial and intangible hidden fees.

Depression left untreated often results in more unhealthy or risky behaviors, addictions, problems at work, and would drain one's physical health and increase the risk of stroke, heart attack, and other physical ailments. Beyond wages lost, how do you put a dollar value to these? Poor interpersonal relationships resulting in divorce have emotional costs in addition to the hundreds if not thousands of dollars for divorce proceedings in court.

Regarding the health of relationships, the late Dr. Stephen Covey in his book “The 7 Habits of Highly Effective People,” talked about the emotional bank account. In case you haven't heard of this, below is a summary from his blog.

"Remember the emotional bank account—similar to a [financial] bank account, you can make deposits or withdrawals from each of your family relationships. Make a conscious effort to make meaningful deposits in your relationships. When you make a withdrawal, apologize and correct the mistake."
"Reach out to someone today with whom you have a strained relationship or someone whose relationship needs strengthening. Make a deposit in their Emotional Bank Account…and commit to continuing the deposits. And don’t forget making deposits in your strong, high-trust relationships—it’s what keeps them strong! Enjoy the adventure!"

The financial planner's paradoxical advice was to spend more on vacations, which can be a time of major deposits into emotional bank accounts.  When it comes to planning where you will invest the most, keep an end-of-life perspective, and when prioritizing your deposits, don't neglect the emotional bank accounts.


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