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Working with a financial advisor can help you craft a plan from paying down debt to building wealth. However, not all financial advisors are alike in their approach. Advisors that rely on holistic financial planning use a comprehensive strategy that includes your values, goals and experiences with money. Rather than planning for individual life stages or using a product-based approach, holistic financial planners consider every aspect of your financial life.
Consider speaking with a financial advisor to create a comprehensive investment and retirement strategy.
Holistic Financial Planning, Explained
A financial advisor helps their clients achieve their financial goals by taking a broad approach to financial planning, including budgeting, saving and investing. What separates holistic financial planners from other financial advisors is how they view their client’s journey.
Specifically, holistic financial planning uses a top-down approach rather than working from the bottom up. When you work with a holistic financial advisor or planner, it’s usually on a goals-driven basis.
Your advisor will help you figure out answers to questions like these.
- What are your goals?
- What is your current progress in reaching those goals?
- How can you move forward toward your goals?
An advisor who uses a bottom-up approach, on the other hand, may focus more on how much you can afford to invest or the return you might receive from a particular investment. These advisors may rely on numbers, such as your age or income, to make assumptions about your financial plan. This helps determine how much you need to save or invest to reach a specific goal.
A holistic financial planner or advisor, on the other hand, looks at more than just the numbers to help you come up with a complete wealth management strategy.
What’s Included in a Holistic Financial Plan
Holistic financial planning helps you create a comprehensive plan that ensures all the individual parts of your financial life work together.
A holistic financial plan can include:
- Investment strategy
- Retirement planning
- Social Security and Medicare planning
- Annuities
- Long-term care insurance and planning
- End-of-life planning, including advance healthcare directives and powers of attorney
- College planning
- Insurance planning
- Estate planning
- Tax preparation and planning
- Budgeting
- Savings
- Business and succession planning
- Charitable giving
- Major life changes (divorce, job loss or birth of a child)
A holistic plan can cover any of these topics, depending on your financial situation.
The emphasis is on shaping a plan that accounts for your financial goals while considering what you value and prioritize most. Holistic advisors try not to leave any stone unturned so that you can have complete confidence in your financial plan.
A financial planner or advisor without a holistic approach may only focus on investment management. If they earn money on a commission basis, they may be more inclined to shape your financial plan based on certain investment products.
The advice you receive regarding your finances or your relationship with your advisor may feel less personalized. That doesn’t mean their advice isn’t as good, but it does illustrate how different a holistic approach can be.
Benefits of Holistic Financial Planning
The main advantage of taking a holistic approach to financial planning is that it provides a big-picture overview to help you achieve your life goals in a way that’s realistic for you.
Your advisor can examine every angle of your financial situation to determine what’s working and what’s not so you can make adjustments accordingly. For example, if you haven’t been making progress toward your retirement savings goals, a holistic advisor may be able to pinpoint missed opportunities or mistakes you’re making.
They can help implement other financial strategies, too, like making your portfolio more tax-efficient or creating an estate plan. Tax planning is an important part of financial planning to ensure you’re able to keep more of your investment gains.
This, in turn, helps ensure your investments and savings are enough to support your desired retirement lifestyle.
Fiduciary Status
You can also benefit from a holistic approach if your financial advisor is a fiduciary.
Advisors have a fiduciary duty to act in their client’s best interests at all times. This means they can’t recommend investment products for a commission if it wouldn’t further your financial plan.
This differs from broker-dealers, who are only required to follow a suitability standard.
Fees
In terms of fees, it’s important to understand whether a financial advisor is fee-only or fee-based.
- Fee-only advisors. Fee-only advisors earn money through the fees they charge to you. These fees can be assessed hourly, at a flat rate or on an annual basis, depending on the advisor.
- Fee-based advisors. Fee-based advisors get paid through commissions based on the products they sell.
If you’re working with a holistic financial advisor, you’re more likely to pay fees based on the services they render.
How Holistic Planning Changes at Different Life Stages
A holistic financial plan isn’t a document you create once and revisit occasionally.
The areas that need the most attention shift as your income, family situation, assets and timeline change. A good holistic advisor adjusts the emphasis accordingly.
Early Working Years
Earlier in your working years, the plan tends to focus on building a financial foundation. It is the time to begin thinking about your financial life long-term.
The investment strategy at this stage is usually straightforward.
- Establishing a savings rate that aligns with debt obligations
- Securing the right insurance coverage
- Beginning retirement contributions early enough to benefit from compounding
- Analyzing spending habits
- Building emergency reserves
- Planning for income growth
Middle Working Years
In the middle years, the plan gets more complex. Income is typically higher, creating more tax-planning opportunities and more decisions about where money should go.
Competing priorities become harder to balance: retirement savings, college funding, mortgage payoff, potential care responsibilities for aging parents and growing insurance needs. Worse, they all tend to arrive at roughly the same time.
A holistic advisor at this stage helps you sequence those priorities rather than treating each one as an isolated problem to solve.
Approaching Retirement
As retirement approaches, the focus shifts from accumulation to transition.
Central conversations include Social Security timing, healthcare coverage before Medicare eligibility and withdrawal sequencing across different account types. It also accounts for the tax implications of each decision.
Your plan that worked well at 45 needs meaningful adjustment at 58. The advisor who knows your full picture is better positioned to make those adjustments than one who only manages your investment portfolio.
Retirement
In retirement, the plan continues to evolve.
Spending patterns change, estate planning becomes more pressing and your portfolio’s risk profile typically needs to shift. A holistic approach at this stage means keeping all of those moving parts connected rather than managing each one separately.
How to Tell If an Advisor Is Actually Taking a Holistic Approach
The term holistic is used broadly in financial services. However, not every advisor who uses it practices it meaningfully.
There are concrete signals that separate advisors who genuinely integrate your full financial picture from those who default to investment management, with some planning language attached.
Consultation
The clearest signal is what they ask about in early meetings.
An advisor taking a holistic approach will want to understand your income, debt, insurance coverage, estate documents, tax situation and goals before making any recommendations. If the first conversation moves quickly toward investment options or product recommendations without establishing that foundation, the approach is more transactional than holistic, regardless of how it’s described.
Pay attention to whether the advisor connects different areas of your financial life or treats them separately. A holistic advisor who reviews your investment portfolio should also consider the tax consequences of its structure.
One who discusses retirement income should be factoring in Social Security timing, required minimum distributions and healthcare costs together, not as separate line items. When an advisor notices that a decision in one area of your plan affects another and raises it without being prompted, that’s a sign the approach is genuine.
Comprehensive Plan
The first plan they deliver tells you a lot.
A comprehensive holistic plan covers more than investment allocation.
It addresses insurance gaps, tax efficiency, estate planning and near-term financial priorities alongside longer-term goals. A plan that is primarily an investment proposal with some retirement projections is a narrower product than what holistic planning typically delivers.
Collaboration
Finally, consider how the advisor handles areas outside their direct expertise.
A genuinely holistic advisor knows when input from a tax professional, an estate attorney or an insurance specialist is beneficial, and they either have those relationships or they help you build them.
An advisor who treats every financial question as something they can handle alone may be operating with a narrower scope than the holistic label implies.
Bottom Line
Holistic financial planning may be right for you if you want financial advice covering every aspect of your life. With holistic planning, you and your advisor can design a plan that adapts and evolves as you move through life while keeping your goals in sight. Advisors who use holistic financial planning take into consideration your values, goals and experiences with money in putting together a financial plan.
Tips for Financial Planning
- Building a financial plan on your own can be difficult. A financial advisor can help with this. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- When vetting potential financial advisors, it’s helpful to know what questions to ask. For example, you can start by asking what type of strategy they use when offering financial advice, either holistic or otherwise. You should also ask if an advisory has fiduciary status and how they assess their fees.
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