Learn how investors really feel about money and why
Ask financial advisers what they discuss with their clients and you’ll usually get a one-word answer: money.
Money of course can be a springboard for delving into all kinds of personal issues. But few advisers dig deep enough to learn how their clients really think and feel about money.
For Mitch Anthony, a professional speaker and trainer, what differentiates successful advisers is their ability to have revealing, substantive conversations with clients. Rather than just administer a risk-tolerance survey, the best advisers focus on getting a better sense of clients’ attitudes, hopes and fears about money.
“Business growth is the product of the dialogue you choose or not choose to have with your clients,” said Anthony, president of ROL Advisor in Rochester, Minn. “The biggest impediment to growth is the questions you’re not asking.”
To launch what Anthony calls “meaningful dialogues around money,” proceed in two steps:
1. Lay the groundwork so that clients are more apt to open up. Explain the purpose of the conversation before you start peppering an unsuspecting client with personal questions.
“Establish context for the questions you will ask,” said Anthony, co-author of “Your Client’s Story” and other books. “And get the client’s permission first before you ask those questions.”
He gives an example of how you can accomplish this with a new client: “I find it helps to learn about your history with money. Would you mind if I ask you some questions about money?”
Some advisers prefer a grander approach to set the right tone. Anthony cites a top producer who starts new-client conversations by saying, “I’m not really comfortable being entrusted with your financial welfare until I have a clear understanding of who you are and what you’re all about.”
2. Pose thoughtful questions and let clients answer on their own terms. Once a client gives you the go-ahead to ask, plunge in with earnest curiosity.
Anthony suggests asking, “What was money like for you growing up?” and “Have you had any experiences — good or bad — with financial professionals that you’d like to talk about?”
“When you’ve been burned, you feel gullible and stupid,” Anthony said. “Many clients are wary and defensive and afraid to act. They’ve been waiting to tell someone” about their dealings with an adviser, accountant, insurance agent or other financial person.
Keep quiet after you ask your question. Give clients ample time to respond. There may be a pause that feels like an eternity. Be patient. Signal with your body language that you’re eager to listen and learn. Maintain friendly eye contact and don’t fidget.
“Most advisers are good at gathering facts and numbers, but bad at engaging clients in who they are and experiences they’ve had,” Anthony said. “You have to overcome a lot of conversational bad habits” such as interrupting.
Even if you think you already do a good job forging a personal bond with clients, there may be room for improvement. In his coaching sessions, Anthony asks advisers to write the initials of 10 clients “whom you think you know really well.” Then he challenges advisers to answer a series of questions about these clients, including:
• Have they had traumatic events in their life?
• What are the defining moments in their life?
• Do they have children with special needs?
• Where are the clients originally from? Where did they grow up?
• Have they changed careers?
“You’d be amazed how many advisers don’t know these things,” Anthony said.
Why get so personal with clients? Because the more they reveal — and the more you listen with empathy — the more you solidify your relationship.
“You want to induce stories from clients,” Anthony said. “Trust is not built by clients watching you talk. Trust is built by listening to their stories.”