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Financial Planning > Behavioral Finance

How Will You Help Your Clients?

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At its best, financial advising is a helping profession. It is not just a service profession. The coming decades will elevate and emphasize the client communication skills needed within this helping relationship.

Though many advisors don’t yet accept the helping nature of financial advising, try viewing it from your clients’ viewpoint. Clients come seeking help for a problem in their financial life, a problem for which they need someone to accurately diagnose the problem, determine possible courses of action, and assist in implementing solutions. I say “assist” because, as in medicine or counseling, successful implementation must be a collaborative effort between the professional and the client. Behavioral factors on both sides of the desk make or break any well-designed plan.

Yes, much depends on the client’s personality, readiness for change, degree of trust, capacity for risk and ability to collaborate. But success is also linked to the advisor’s capacity to listen, to keep out unhelpful biases and self-interests, to adapt to the client’s needs and to understand those parts of the client’s life that affect the problem.

Clients consistently report the greatest satisfaction, success, trust and loyalty with advisors who have great bedside manner. And when clients feel helped — not just served — there is a deep sense they have been cared for.

Client relationship skills have been gaining recognition recently, yet they are still relegated to second place in the minds of many advisors and the agendas of professional organizations. Several trends are converging to position these skills as core competencies for the future of the profession.

One is that organizations are starting to set standards that focus on client skills. In 2006, the Certified Financial Planner Board for the first time listed knowledge of counseling skills and client psychology as recommended areas for proficiency. Though formal CFP assessment and credentialing are not yet there, these are a natural extension once conceptual and political battles are worked out.

Top wealth managers already know that the best advisors excel in emotional intelligence and attunement to family dynamics impacting money problems. The Family Wealth Alliance released the first-ever standards recommended for multifamily offices in 2005. It is now considering best practices and training for the relationship-manager position, with an eye toward eventual credentialing. Just as new trends often start at more rarified levels in an industry and trickle down, certification of relationship skills will ultimately make its way to the mainstream advisor.

Second, psychological training of advisors is spreading. Counseling courses are emerging within academic programs across the country to train financial planners at the outset of their careers. There are more psychologically oriented articles appearing in financial journals and more counseling workshops at conferences.

Third, the current industry realignment from commission-based services toward fee-based advising will call for greater emphasis on client relationship skills. Longer, more comprehensive advising inevitably means working with the client at a more personal level. Note that strongly fee-based organizations like NAPFA and the FPA contain the most advisors with a life-planning orientation and emphasis on communication skills.

Client demographics are pulling for this as well. Baby boomers are already showing us they want more personal focus, in-depth relationships and next-generation attention than their forebears ever requested.

Fourth, collaborative relationships between financial advisors and psychotherapists are on the rise. What was once a rare and cautious collaboration is now more broadly accepted, though still far from mainstream. This parallels a 20-year trend in health care where co-location of counseling and medical services was first bold and is now commonplace. Already in health care, a competitive advantage is falling to those clinics (think: “firms”) that not only offer one-stop shopping for managing problems but also benefit from cross-communication among professionals responsible for patients’ (think: “clients”) welfare.

In the coming decades, financial advising will achieve maturity as a profession that helps — not just serves — clients with their problems. Whether the pain is in their stomach, their marriage or their portfolio, people will expect help to be delivered in a trustworthy, empathic and collaborative manner. They will want reassurance their advisor has been trained in the core competencies of the client relationship, with certification of those skills by responsible professional organizations. The future of financial advising lies in the training and credentialing of client communication skills, for what is — and has always been — a truly helping profession.

James Grubman, PhD, is a nationally recognized consultant to families of wealth, family businesses and the advisors who serve them. He also teaches in the business school at Bentley College about psychology in financial planning. Website:


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