Earnings & Yearnings

Jim Palazzolo has a unique way of helping his clients manage their money: He works from the inside out.Many financial planners work with a client's outward behavior -- how much they earn, how they budget their money, their financial goals -- but often, says this certified public accountant and financial planner, real change can't happen until clients look inward and determine what it really is they're trying to buy.Through his Ann Arbor-based business, Financial Wellness Resource, Palazzolo incorporates the concept of "the spirituality of money" into his daily consultations. He and financial planner Douglas Gross, owner of Investment Management and Research in Ann Arbor, have recently signed on with Essence Point, an Ann Arbor-based nonprofit organization that offers classes in spiritual, psychic, artistic, musical and personal exploration, to lead workshops on the topic. The workshops will be informal, Palazzolo says, and should be thought of more as "conversations" than financial planning seminars. Initially, Palazzolo and his client look at the balance between what the client earns and what the client desires. Not surprisingly, the balance is often light on the earnings end and heavy on desires. Then he asks clients to look at their spending patterns. This is where the spirituality comes in."People are trying to produce results, and the result people are trying to produce is to be satisfied," says Palazzolo. "Advertising has done far too good of a job convincing us that we're not satisfied, and somehow that if we just acquire the next 'X,' whatever X is -- new car, new house, new diamond -- that somehow we're going reach that point of sufficiency, that point of satisfaction." Once he's heard that dissatisfaction, Palazzolo says, he often tells his clients something fairly unorthodox for a guy in a profession typically geared toward earning clients more money. He tells them they're looking in the wrong place."What I have found is that level of sufficiency comes from a place that is far removed from dollars and cents. It comes from within," he says. "When the opportunity presents itself, we start having a discussion about what does it take to be satisfied. And what I find is that it is something different than what you would expect." Instead of aiming for that unattainable dream house or sports car, he suggests, people should take another look at their lives. "It really comes from just taking a deep breath sometimes, and looking around you and saying, 'No matter what, I'm OK.' And if you can reach that point, then you can be satisfied with your circumstances rather than trying to wrestle with your circumstances and trying to change the picture entirely."From there, financial planning can take a more realistic tack, Palazzolo says. This often begins with encouraging his clients to transfer money that would previously have been used for what Palazzolo calls "past consumption," to money that can be used for "future consumption." The money will be spent either way, Palazzolo reasons, but setting money aside for "future consumption" creates a financial cushion and precludes wasting money on things we only think we need. Sometimes Palazzolo gives his clients exercises to help them alter their habits. For instance, he's helped some create "credit card condoms" -- a small envelope for their credit cards. The outside of the envelope reads, "Is this purchase necessary?"Once his customers have altered their spending habits, it's finally time to pick suitable investments. Not all of Palazzolo's clients reach this point. Some, he says, get scared off as soon as the talk turns to behavioral change, and he's probably heard every rationalization in the book for a wide variety of purchases."It is an interesting task, because it's confronting people. They have to stop doing things the way they did them," he says. "They have to try something different."And of course, the change is not instant. "Nothing happens overnight," Palazzolo observes. "It takes time."For information on the Spirituality of Money workshops, contact Essence Point at 734-913-9830. Palazzolo can be reached at 734-662-2090 and Gross at 888-973-9030.


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