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Practice Management

Most clients say they are happy with their planners, but that’s not enough to distinguish yourself from your peers.

This Practice Management article is intended for financial advisors only (registered representatives of broker/dealers or associated persons of Registered Investment Advisors).
 

In a recent survey, 68% of planners said that having a defined and effective communications plan is critical to successful financial planning. But just 27% gave themselves a top rating for having a defined and effective client communications plan.

That's a problem, pointed out Julie Littlechild, the founder of New York-based Advisor Impact, which takes a data-driven approach to improving communications between planners and clients.

Ninety-four percent of recently surveyed clients said that they're happy with their planners. That's not good enough, Littlechild told advisors at the FPA annual conference. "Doing what we're doing gets us to clients who feel fine about relationships with their planners. That's important, but it also means that you're like most of your peers."

Approaching communications as an opportunity to provide and demonstrate value is key, Littlechild said. To do that, planners must:

1) Ask for feedback—and then take action based on that feedback.
"When I ask you for your input, and then I do something about what you tell me, you have a bigger stake in what we're doing together," Littlechild said. Instead of sending a client survey every two years, poll website users or send a small survey every six months.

2) Keep the conversation relevant.
"Don't use the 'here's a report, let's talk about it, go'" model, Littlechild said. Have team strategy meetings to discuss what you want from the conversation. Before they come in, ask clients what's changed in their lives, both small and large. "Clients often don't know that a particular life event might be relevant to their financial planning," she said.

3) Involve the client in setting the agenda.
"Your team figures out what it wants to talk about at a client meeting, and then someone calls and actually talks with the client about that," Littlechild said. "That person says, 'Here's what we're thinking of discussing at your next meeting. Maybe you have something to add?' Then give them a few days to think about it. Advisors can really fire off information quickly, and clients pose questions better if they can think about them a bit in advance."

4) Ask questions that really help clients open up about money, such as:

  • If you had all the money you need, and needed only to do something every day that thrills you, what would that activity be?
  • It's a random Wednesday morning during your retirement. What are you going to do today?
  • What are your best financial decisions? Your worst?
  • What's your biggest fear about money?
  • If you could magically fix any three of your financial problems, which ones would you solve?

5) Make your conversations literally interactive.
"That might be as simple as a second computer monitor," Littlechild said. "Make what you have to say visual and larger than life. Integrate technology."

No single choice on this list will necessarily revolutionize a relationship—but that's okay, Littlechild said. "Sometimes change is at the margin. It's not earth-shattering, but it adds up and begins to create a different approach.

--Ingrid Case

Ingrid Case, a Financial Planning contributing writer in Minneapolis, is a former editor at Bloomberg News and author of Your Own Two Feet (and How to Stand on Them): Surviving and Thriving After Graduation.


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