Goals-based advice is a financial planning methodology that allows clients to save for multiple financial objectives across various funding sources and time horizons. It helps to keep clients focused on working toward their achievable goals which you've set for them, above chasing returns and being less reactive to market volatility.
There are three key elements of the GBA approach:
1. Goals discovery - the conversation that draws out the client’s goals, dreams, values, and aspirations.
2. Goals-based advice - the technology & modelling that sits behind the customer advice experience. It helps advisers to explore their clients' goals, discuss what-if & trade-offs, and model advice strategies interactively in front of clients. It seeks to improve the client's goal achievability as the key success measure.
3. Goals-based investing - this is the “goal risk” methodology that allows individual or buckets of goals to have their own risk tolerance & investment asset allocation, rather than the traditional “one-size fits all” approach to investing.
To learn more about GBA click here. Our Goals-based advice white paper also takes an in-depth examination.