Financial Planning

All Of It

We lionize problem solvers.

Rescue someone, and you’re their hero. Problem solvers earn accolades, headlines, and promotions. Problem solvers tend to make more money than their more “boring” counterparts.

Problem solvers, it would seem, have the greatest impact on our lives. But Dr. Atul Gawande, nationally renowned surgeon and writer, thinks we have it backwards.

Gawande became a surgeon because he wanted to be a problem solver and to make an impact. “Surgery was definitive intervention at a critical moment in a person’s life, with a clear, calculable, frequently transformative outcome.”

But a chance conversation with a colleague left him wondering if he was really the one making the biggest impact on his patients lives?

In fact, in his 2017 article for The New Yorker, “The Heroism of Incremental Care,” he argues that its not problem solving but ongoing care that has the greatest ability to transform lives. He writes,

We have a certain heroic expectation of how medicine works. We expect a doctor, as a savior, to come in and make things right. But much of what ails us requires a more patient kind of skill.

Incrementalists encourage us to take a long-term perspective. Their efforts are focused on anticipating problems, and with consistent attention and process, they can reduce, delay, or prevent the worst of them. Primary care physicians won’t make us bulletproof, but they can shape our future.

In fact, states with more primary care doctors have lower rates of mortality, lower rates of hospitalization, and lower medical costs.

In any given medical situation, a specialist is likely to have an advantage over a generalist. If that’s true, what skills do primary care doctors have at their disposal that make such an impact on overall health? Why are the outcomes better even for people with a primary care doctor, who also have the kind of complex needs that require a specialist? Primary care providers, Gawande writes,

focus on the course of a person’s health over time, even through life. All understanding is provisional and subject to continual adjustment.

“Success,” for primary care physicians, “is not about episodic, momentary victories…Its about the longer view of incremental steps that produce sustained progress. That is what making a difference really looks like.”

The fact is most of us don’t like to address problems until they’re upon us and unavoidable. But steady attention over time can prevent much of the need for specialized problem solving in the first place.

There’s no particular magic involved here, other than the magic of human connection. Gawande’s colleague Dr. Asaf Bitton concludes,

It’s no one thing we do. It’s all of it.

It’s the relationship.

The tendency to undervalue incrementalism and overvalue heroism isn’t unique to the medical world. For more than 200 years, the financial world has lionized speculators, traders, investment bankers, and private equity titans. In his 1987 novel The Bonfire of the Vanities, Tom Wolfe famously dubbed them the “masters of the universe.”

While the masters of the universe were reaching their apex in the 80’s Wall Street era of Gordon Gekko, there was an incrementalist movement bubbling up below the surface.

Financial planning traces its roots back to the last days of 1969, but for much of the 1970’s growth was modest. When my mentor Alex Armstrong obtained her CFP certificate in 1977, she was the first person in the entire city of Washington, DC (not exactly a small town) to hold the designation.

Alex and her contemporaries had the foresight to see what Atul Gawande would come to write about 40 years later. Financial success is not about episodic, momentary victories. It’s not about getting lucky on an IPO, or access to an exclusive private equity deal. Its about incremental steps that produce sustained progress over time.

Financial planners as incrementalists emulate the model of the primary care physician. They take a long-term view, with a focus on steady, iterative attention to anything in their clients lives with a dollar sign attached to it. All understanding is provisional and subject to change.

Much like the contrast between surgery and primary care, the relationship building and steady incremental effort involved in financial planning stands at odds with much of what we celebrate.

Monitoring blood pressure an cholesterol levels, adjusting medications, conducting checkups — none of this is glamorous work. Neither is monitoring income and expenses, withdrawal rates, managing taxable income or tweaking asset allocation over time.

This isn’t the work that’s expected, when we typically think of finance and the markets. It won’t be glorified. Our libraries aren’t filled with books written about great financial planners or primary care physicians.

But it’s the work that’s required. It’s the work that produces better outcomes and transforms lives.

It’s no one thing we do. It’s all of it.


Further Reading:

The Heroism of Incremental Care, by Atul Gawande, The New Yorker, 1/15/2017

The Bonfire Of The Vanities by Tom Wolfe

The History of Financial Planning by E. Denby Brandon, Jr.