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The next step in the conversation is structuring our discussion around what is the focal point. An essential part of finding advice that is additive to your net worth is someone that wants a relationship. You want someone that is talking with you, not at you. While this is extremely easy to say, in reality, it might be difficult to find.
Valuable financial advice aids in the solving of problems, not talking about how many years of experience someone has at a firm. Valuable financial advice also does not try to wow you with how many assets under management someone has, donning a three-piece suit, or explaining how they’ve found a magic cure-all financial product. Discussion like that is often done to establish a position of power in a conversation. While you want someone who knows the nuts and bolts of financial planning, power-signaling and ego are unattractive. In today’s world, genuine interest, listening, and asking good questions are as good as gold or bitcoin whatever your preference is; anyways let’s help you spot the difference.
An advisor asking thought-provoking questions should be paramount. Questions that are far more than, “What are your goals?” and “When do you want to retire?” Talking about money is difficult, and often something a person never truly verbalizes. Some might think the following is fluff, but your behaviors dictate far more than you realize. Our culture is not open to discussions on why or how you feel about money the way you do. Even the idea of what did money mean growing up can be impactful. Concepts around money and financial health are important things to think through. What does success look like to you? For some, it’s material things, for others its experiences. The focus should be on discovering those hidden feelings you have, perhaps that not even your spouse knows about. The detailed understanding helps to construct a financial mindset, and allow for a plan of action to be designed for you that you can stick with for the long term. Think of it as a financial therapy session almost.
The question you should be asking is this…why would I talk to a stranger about things my closest friends and family knows nothing about? That is the main issue. As an advisor, it’s easier just to collect minimal information, recommend a product, and base your needs on a software program that delivers a far too generic “financial plan.” Recommendations are an essential piece, but far too often there is a product that is placed to fit a proposal. The suggestion is usually ready for you before you walk in the door. While I’m not here to claim that there is a perfect solution, I do believe there are some steps that advisors should take to demonstrate how they build relationships, dive more in-depth, and focus on you. Here are some steps an advisor can be taking to show this in action because we know actions speak louder than words.
- They want to understand how you best process information and communicate.
- Clearly articulate their core values and mission.
- Define the financial planning and investment process and how your involvement is needed.
- Construct and review your Investment Policy Statement (IPS).
- Ask questions, which make you pause and think for a minute. Silence is okay!
- Center meetings around what you want to accomplish and focus on you and your families needs.
- They remember details about your life and don’t readdress the same questions.
- They provide in black and white how they are compensated and paid.
- They are clear and concise on how recommendations improve your situation.
- They follow-up and follow through on promises and commitments made.
- They return phone calls, emails, and questions promptly.
I hope the above can help provide a glimpse into some of the ways an advisor can establish trust and begin to show who they are focused on. Without a relationship built on trust and communication, there is no value. Think of it just like you would a connection in your personal life. Finally, if you remember only one thing for today, find an advisor who listens and asks good questions. For once it really should be all about you!