kitces.com | Nerd's Eye View - Client Trust & Communication

How Do You Combat The (Too) Long Financial Planning Meeting?

nospam@example.com (Michael Kitces) — Mon, 30 Apr 2012 07:15:00 -0400

Financial planning can often involve some pretty long meetings, simply given the complexity of both the lives of our clients, and the solutions from which they must choose. Unfortunately, though, recent research shows that when we have to stay mentally focused for an extended period of time, it can actually lead directly to less effective decision making. Consequently, asking clients to make important decisions at the end of a long financial planning meeting - even one filled with great information and education - may actually be the worst way to lead the client to a well-thought-out decision, due to mental fatigue! Fortunately, though, there are solutions. Some planners may choose to adjust how meetings are structured, making the meetings shorter and/or presenting decision-making opportunities to clients earlier (before they are so mentally fatigued). Alternatively, it turns out that a remarkably effective solution is to actually refuel the brain, with some carbohydrates/sugars that bring the brain the glucose it needs to refresh itself. But in the end - whether it's a shorter meeting, a cookie, or some fruit juice - it's probably time for planners to pay more attention to the client's state of mind before moving to the decision-making phase of a financial planning meeting!

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The Latest Trend In How Advisors Are Using Social Media (With No Compliance Headaches!)

nospam@example.com (Michael Kitces) — Thu, 23 Feb 2012 11:16:00 -0500

As social media continues to take the world by storm, advisors are increasingly under pressure to begin using social media in their own practices. Yet the advisory community has generally been slow to adopt, due both to the compliance challenges involved, and a general wariness about whether prospective clients would really make a decision to trust and work with an advisor based on social media marketing. In fact, a recent study by the Aite Group suggested that "the bloom is off the rose" when it comes to advisors adopting social media to bring in new business. Yet at the same time, a new social media trend is emerging - using social media not to develop new clients, but to better communicate and interact with existing clients. And the good news is that this approach to social media potentially has far fewer compliance headaches, too, because it's less about talking, and more about listening.

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Have Financial Advisors Gotten Off Track With Client Vaults?

nospam@example.com (Michael Kitces) — Thu, 16 Feb 2012 09:30:00 -0500

Once upon a time, the purpose of a client vault was to use it like a vault. It would store important client documents to be accessible if/when needed. It was designed to be the digital equivalent of a safety deposit box in your local bank's vault. But at some point over the past several years, we began to shift, and the client vault became not only the place we store the files we access rarely, but the ones we access regularly. Advisors increasingly made it the centerpiece of their efforts to securely share files and collaborate with clients. Yet in reality, this is quite impractical. Just as you don't regularly go to your local bank vault to constantly move things in-and-out of your safety deposit box, so too do we need to stop using our digital data vault like a collaborate file sharing tool. Just as going regularly to your bank every time you need to check on something would be a huge hassle and a negative experience, so too is using the data vault as a collaboration tool a negative client experience. It's time for a better alternative.

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Your Clients Don’t Care THAT you do Financial Planning; It’s About WHY You Do It (Guest Post)

nospam@example.com (Michael Kitces) — Wed, 18 Jan 2012 21:48:00 -0500

In the early years of my career, I genuinely hated the concept of marketing. I had learned about the powers of persuasion in school. I was taught during an internship that the success rate of closing a client was x times greater if you can stir up emotions like fear and uncertainty. I understood the role of marketing in the world of widget makers as a way to introduce their commodity to the market, but struggled to reconcile the use of these forces when dealing with individuals and families, many of which have little to no education around money and investing.

In recent years, however, I have made a few discoveries that have completely reshaped my viewpoint on marketing. And while I may still not have all of this figured out, it has become painfully clear to me over the last several years that marketing our services and our value is something we, as a profession, are absolutely horrible at doing.

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Financial Planning Leaders Suggest The One Skill That Has The Biggest Impact On Success (Guest Post)

nospam@example.com (Michael Kitces) — Wed, 11 Jan 2012 10:21:00 -0500

What one skill (above all others), if you developed and did it in an excellent fashion, would have the biggest impact on you as a financial planner? This is the question that was posed to the leaders in the financial planning profession. Initially, the plan was to elicit feedback as to where to focus energy in the new year to become a better advisor, but after receiving so many excellent responses I wanted to share the common themes. What is the most important skill? There is always a big focus on the technical side of planning (which is obviously very important), but is it that the most important? Or is it empathy, communication, or relationship building? The answers varied by the leaders that responded, but the common theme was clearly that in the end, the interpersonal trumps the technical.
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The One Skill That Has The Biggest Impact On Being A Successful Financial Planner

nospam@example.com (Michael Kitces) — Tue, 27 Dec 2011 09:59:00 -0500

Developing your skillset as a financial planner is complex. From learning the financial planning body of knowledge itself, to the analytical skills to apply it to specific client situations, to the written and verbal skills necessary to communicate recommendations to clients, to the interpersonal skills required to actually motivate and support clients on implementing those action items, there's a lot to learn. Not to mention the skillset necessary to find and attract new prospects to become clients in the first place. But if there is one skill that seems to have a bigger impact above all else for the success of a financial planner, it's the ability to listen. To REALLY listen.
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Are We Being Too Forward With Our Clients?

nospam@example.com (Michael Kitces) — Wed, 29 Jun 2011 09:26:00 -0400

In the dating world, being "too forward" generally means trying to advance a relationship at a pace that is too fast for comfort; being too confident and direct in what is said, to a point that may not be socially acceptable. The general remedy in the dating world, then, is to "take it slow" and allow the relationship to build trust before trying to advance a relationship to the next stage. Of course, building a trusting relationship is not unique to the dating world; many of the exact same dynamics apply in building the planner-client relationship. Yet in practice, because financial planning relationships must move to an implementation stage after “relatively” few meetings, planners often must be very forward during the sensitive relationship-building phase. But how far is too far? Have you been asking your clients to get naked on the first date?

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Is Social Media A Tool For Deepening Client Relationships?

nospam@example.com (Michael Kitces) — Tue, 10 May 2011 19:17:10 -0400

As the popularity of social media rises - from Facebook to LinkedIn to Twitter - advisors are increasingly asking "what's all the buzz about" and "why should I care?" As many point out, planners develop new clients primarily by getting referrals from existing clients, and having face-to-face meetings to get to know them better. No one makes a decision about who to give their life savings to based on a Facebook page, right!? Perhaps, but a focus on the new business development opportunities from social media misses an important but crucial point - there's already plenty of value to be derived from social media, just by connecting to your EXISTING clients, to deepen the personal relationship you already have with them!
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It's Not Just About Telling Clients What To Do, It's About Motivating Them To Do It!

nospam@example.com (Michael Kitces) — Tue, 10 May 2011 09:58:35 -0400

Being a good financial planner is not just about having the knowledge and information to direct clients on how to best achieve their goals and financial success. Ultimately, most would agree that the true measure of success is to look at how effective the planner is in actually helping clients achieve those goals; in other words, does the client actually have an improved path to success because of the planner's involvement. In turn, this means that the planner's true success hinges not only upon having the right advice, but also depends upon the client actually implementing that advice, and the planner's ability help those clients make the required changes! There's just one problem: it turns out that telling people what to do is actually a terrible way to get them to do it!
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"Power Sleep" for Better Client Meetings - Dr. James Maas On The Nighttable

nospam@example.com (Michael Kitces) — Fri, 05 Nov 2010 06:01:01 -0400

Are you a "good" sleeper, able to fall asleep as soon as your head hits the pillow, or to take a nap at a moment's notice? As it turns out, if this describes you, it is almost certainly a sign that you are severely sleep deprived, to the point that it is adversely impacting your alertness in client meetings!

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The Toll of Market Uncertainty on the Financial Planner

nospam@example.com (Michael Kitces) — Mon, 18 Oct 2010 10:20:26 -0400

Any financial planner who has worked with a client through some "market turbulence" or an outright bear market is well aware of the stress that market uncertainty can bring to the client. But how often do we look at the stress that market uncertainty brings to the financial planner vis-a-vis the client relationship?

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Are You Comfortable With Silence?

nospam@example.com (Michael Kitces) — Tue, 12 Oct 2010 13:13:12 -0400

We often evaluate the quality of a conversation by its activity; the pace of the back-and-forth banter can be used as a barometer of how engaged someone is in the discussion. Given our tendency to find comfort in sustained dialogue - thus the phrase "awkward silence" - I was very struck to see the following profound tweet: "Get comfortable with silence. Some of the most important things clients say follows silence."

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