When you don’t reach your personal and financial goals, it can be both frustrating and disheartening for you and your clients. How can we change this for the better?
Research has shown that using the principles of Self-Determination Theory your clients can dramatically increase their chances of success. This happens when you focus on a meaningful “why” in the pursuit of goals.
Let’s talk about Self-Determination Theory (SDT)
What is it? A model of human motivation concerned with supporting our natural or intrinsic tendencies to behave in effective and healthy ways.
Is it widely accepted? Yes and it was initially developed by Edward L. Deci and Richard M. Ryan, psychology professors at the University of Rochester. It is proven, researched and practiced around the world.
The two fore mentioned gentlemen say that goal pursuit and goal attainment are highly influenced by “the degree to which people are able to satisfy their basic psychological needs as they pursue and attain their valued outcomes.”
Meaning what? Intrinsically motivated goal pursuits such as those related to personal development, emotional relationships, or community involvement tend to be more rewarding and thus result in higher rates of goal achievement.
Really…why? This is because such goals are more likely to satisfy our need for competence, relatedness, and autonomy.
Other goals are not? Well, extrinsically motivated goal pursuits, in other words, those that are aligned with financial gain, image and appearance, or fame and popularity, are less satisfying to these critical psychological requirements and will result in lower levels of goal realization.
So what should we do? If you take time to help your clients evaluate their goals pursuits based on their psychological needs, it will dramatically increase their awareness of the “why” that underlies each aspiration.
For example, and in particular, when you consciously help you client form goals that will satisfy their need for competence, relatedness, and autonomy, it goes a long way in keeping them on course achieving their dreams.
Let’s look a little more closely at this assertion
COMPETENCE: Broadly speaking, the SDT defines competence as the need to effectively master engaging challenges. These are goals that involve activities that allow people to explore their interests, increase their knowledge and skills, and foster a sense of accomplishment. When you talk to your clients along these lines, the goals you set with them are reached more often. The research has proved this.
RELATEDNESS: This is the need to feel secure, develop intimate relationships, and possess a sense of belonging. When you help clients set goals that focus on such things, you work with more passion and commitment to meet them. These are goals that are about forging connections with others, offer opportunities to share knowledge and skills, and allow you to feel a sense of belonging to family, social circle, community, or organization.
AUTONOMY: When your clients pursue goals that will help them move towards autonomy – this is the ability to organize oneself, self-regulate behavior, and avoid external rule or authority – it is a powerful psychological need that is attained through self-directed activities that cultivate a sense of control and address drives and passions that nourish the self. Such goals stand a strong chance of being achieved.
The bottom line: Goals that support your clients internal experience autonomy, competence, and relatedness will enhance their persistence, creativity, and sense satisfaction. When such goals are tied to investment strategies, you both have a better chance to succeed and build a deeper relationship. Do keep this in mind when we set goals with clients.
This blog is adopted from ‘Money Quotient’, written by Carol Anderson. Money Quotient(MQ) is an organisation based in Portland US. MQ trains advisors on Financial Life planning , simply put it trains on -‘bringing Life in to focus for your Money management’. You can read orignal Blog here. https://www.moneyquotient.org/blog/defining-the-why-of-your-clients-goals/