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Author: Meghaan Lurtz

Initial outreach to a financial advicer rarely (if ever) results from a prospective client waking up in the middle of the night in a cold sweat because they just figured out that they're in desperate need of a comprehensive financial plan. Rather, prospects often reach out to set an initial appointment only when they realize they have a specific pain point that they need an advicer's help with. It's during that first meeting that an advicer has an opportunity not only to demonstrate how they can help the prospect solve whatever problem they may be experiencing but also to gain valuable insight into the prospects themselves so that they can begin laying the foundation for what could evolve into a long-lasting professional relationship. Apart from spending time during the first meeting only to gather facts about the prospect, advicers can also utilize a variety of techniques to focus on who the prospect is, start building rapport, begin to establish a meaningful connection, and even set the stage for emotional buy-in.

In a discovery meeting, advicers have a short period of time to gain a deeper understanding about the prospect and establish a connection that will motivate them to become a client. And by asking good questions during that initial meeting, an advicer can learn about a prospect's main concerns and what sort of advice they need. One of the best ways to accomplish this is by asking questions that encourage the prospect to pause and reflect more deeply on the issue at hand. Such 'reflection' questions ask an individual to reflect on whatever information they've just offered in order to find personal meaning in what they've shared and why it's important to them. They are particularly effective in building rapport, because the simple act of asking reflection questions shows that the advicer has been listening closely and is interested in the prospect as a person, not just a potential client.

At a basic level, reflection questions are often framed as "this or that" statements which offer 2 ideas for the prospect to consider. Part of an advicer's job is helping prospective clients gain clarity around their goals, and it often takes several meetings for those goals to become well-defined. However, "this or that" questions can help break down daunting issues (like what a fulfilling retirement might look like for the prospect) by offering just 2 scenarios that they might consider as viable options for what their future might look like, with the caveat that alternatives are always available if neither felt 'right'.

Alternatively, advisers can introduce reflection questions using the phrase, "it seems" as a way to rephrase and summarize something a prospect said in order to elicit additional thoughts. The "it seems" framework is particularly useful when prospects need help prioritizing multiple goals. For instance, an advicer might observe that "it seems that saving for your child's education is important, but it also seems that you're concerned about whether or not you'll be ready for to retire when you want." Notably, such reflection questions aren't meant to tell the prospect which issue is more important, but rather, are meant to help the prospect identify their own reasons for how they should prioritize their goals.

Ultimately, the key point is that reflection questions can be used to help prospects identify the actions they can take to make progress toward their goals, narrow down which of their goals will be the most impactful, and offer prospects the motivation to stick with their financial plan. Finding the motivation to move forward is challenging when the path is unclear, and reflection questions can help prospects find clarity around their values and goals, which can also help them appreciate the value that a financial advicer brings to the table as a valued partner in their journey towards their long-term goals!

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The need for financial professionals to ask prospects and clients questions has a long history in the industry. In earlier days, questions simply facilitated the process of gathering information in order to open accounts and recommend the appropriate products to be sold. However, as the industry evolved from being primarily transaction-based to relationship-based, it has become increasingly important for advicers to become less sales-oriented and more focused on how they can better develop deep, long-term connections with their clients. One of the best ways to accomplish that goal is not to ask better questions, but to also ask engaging follow-up questions that build trust and rapport with clients. The key, then, is in learning a conversational skillset that is natural and keeps the focus on the client.

Fortunately, there is framework that advicers can use to ask authentic and impactful follow-up questions called the Iceberg Method. This technique utilizes a 3-question format that uncovers what matters most to a client and helps develop (and deepen) the client/advicer relationship. It features a succession of questions that first seeks to uncover key facts, then explores the meaning and situational context around those facts, and, finally, offers insight into the client's feelings and values around their particular situation.

Accordingly, the process starts with fact-finding questions, which ideally should be open-ended questions framed as statements (e.g., telling the client or prospect to share what prompted them to reach out), since people can sometimes perceive fact-finding questions such as "What have you done so far to save for retirement?" as judgmental. From there, advicers can dig deeper into the iceberg by asking follow-up questions that are designed to discover the context around information gleaned from the fact-finding stage. These 'situation' questions (which, again, are also more effective when presented in the command/statement form) help the client tell the story around their facts and share why something is important to them.

After understanding the facts and gaining additional situational context, advicers can finally explore the feelings that the client has around the subject that's under discussion by asking follow-up questions about their emotions. Framing these questions properly is essential. Introducing these questions with phrases such as, "It seems that," or, "I've noticed that" or "I'm interested in hearing more about" and then asking how they feel about the accompanying observations is an effective way to invite clients to reveal their honest feelings that drive and inspire them to commit to their financial goals (and implement their advicer's recommendations!).

Ultimately, the key point is that advicers who can learn how to communicate more effectively will not only differentiate themselves in the marketplace, but (importantly) will also do a better job of helping their clients achieve their goals by fostering emotional buy-in to their financial plan. Implementing the 3-stage Iceberg Method for follow-up questions can help clients feel heard and connected, which can deepen and enrich the client/advicer bond, helping engender a trusting and long relationship!

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In initial discovery meetings, financial advisors face the challenge of eliciting specific goals from new clients – a crucial step for crafting a comprehensive financial plan. Asking direct queries may elicit vague responses like "I want to be on track for retirement", which tends to lack the detail needed to plan effectively and spark the client's motivation to actually accomplish those goals. Moreover, probing into a client's financial aspirations might inadvertently lead to negative emotions if past failures are brought to light, potentially eliciting feelings like anxiety, guilt, and shame that could ultimately hinder the client's ability to discuss their goals openly.

If a client struggles to discuss their goals, one way for a financial advisor to redirect the conversation in a more productive direction could be to reframe the question with a positive focus; rather than being reminded of their previous emotional baggage around money, the advisor encourages the client to imagine a more hopeful financial future. For example, they can ask the client: "Imagine you had a magic wand that could let you change anything about your current financial situation – what would you change, and why?"

Techniques like the 'Magic Wand' question are effective because they are solution-focused; they emphasize envisioning positive changes rather than recalling the anxiety or frustration that the client may be experiencing because of the issue. This approach encourages the client to separate their goal from any emotional pain associated with that goal, helping them to focus on the actions they are able to take without the emotional burden of past setbacks. Not only can Magic Wand questions be used as an effective way to recover a conversation veering into negative emotional territory by shifting the mood more positively, but they can also be used to proactively initiate positive brainstorming sessions about financial goals and needs. And for client couples, the Magic Wand question is a gentle way to help partners reveal their individual financial concerns with each other by keeping the conversation light-hearted and solution-focused, steering clear of blame and other negative emotions.

The key point is that in a society where financial status often reflects on personal character, financial difficulties can provoke feelings of guilt and shame – and it may be easy for people to focus on those negative feelings instead of actionable improvements. For financial advisors, having tools like the 'Magic Wand' question can be invaluable for steering clients away from the emotional turmoil of their current financial issues and towards clear, solution-focused strategies for achieving their goals!

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After a financial advisor and their client have agreed on a financial plan, there are usually a lot of good feelings going around. The causes of the client's worries have been identified, there's agreement on the steps that will get the client to where they want to be, and all that's left is to take action to implement the plan. But while it seems like the momentum of the earlier steps of the planning process should carry through into the implementation stage, all too often, the opposite occurs: despite all the steps being in place, the client fails to take the agreed-on actions. While the advisor, not wanting to nag or badger the client and sour the good feelings that abounded earlier in the relationship, finds themselves at a loss for how to follow through. As a result, the plan stagnates, and the next steps – some genuinely timely and others needed to set the client on the right track for the long term – go unaddressed until the next plan update rolls around.

For advisors feeling the frustration of stalled implementation, the first step can be understanding some of the reasons that clients may hesitate to take action even when they may have previously seemed ready to act. Often, there are 3 main causes of clients failing to implement. First, when discussing future-oriented plans like retirement, clients may feel as though those plans should have a high priority for them – and yet, when it's time to make the necessary adjustments today (and often, the lifestyle tradeoffs that are needed to start saving more for the future), the needs of tomorrow suddenly have a lower priority than when everyone was simply talking about them. Secondly, clients may sometimes find themselves simply unable to carry out the tasks recommended by the advisor if those actions aren't discussed in sufficient detail. Lastly, for a client who may be new to working with a financial advisor, it may simply take time for the client to become familiar enough with the planning process and the advisor to take action. After all, conversations are one thing, but taking action can often require a great deal of trust that the advisor understands the client enough to make recommendations in their best interests.

Fortunately, advisors can help clients minimize the potential for inaction by asking some simple implementation questions after the plan has been agreed on that can help focus priorities, clarify the most important next steps, and ultimately build up a rapport that can create the foundation of trust needed before the client takes action. For example, asking the client which task they feel is most important can help reinforce the client's prioritization of the task, while asking the client to share what they know about how to accomplish the agreed-on actions can uncover any potential blocking points stemming from a client's lack of knowledge about how a task should be done.

Ultimately, the key point is that clients don't always fully understand the roadblocks that work against implementing their financial plan. Advisors can achieve more consistent follow-through when they can uncover obstacles to implementation before they happen – and by asking questions to identify these impediments, they can also help the client clarify what they need to do going forward, all while building on the client-advisor relationship that will keep the momentum moving forward each time the plan is updated and renewed (and re-implemented) in the future!

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