You are in competition for an ideal client. You have reviewed the client’s information, goals and objectives. You have laid out a financial plan for the prospect that is technically impeccable. In your eyes it blows away your competitor. But in the end, the prospect decides to do business elsewhere. 

Almost every advisor has experienced a similar scenario. Why does it happen? Because in the financial services business, prospects do not always select advisors based upon their technical skill s or investing  proficiency. They are often selected based upon their skill as a communicator. Advisors who have the ability to convey strategies and concepts to clients in a simple, easy-to-understand manner have a real competitive advantage.

In the upcoming years advisors can expect this reality to become even more apparent. As the baby boomer demographic has begun to reach retirement, advisors are realizing that providing solutions for income distribution is markedly more complex than investing for accumulation. This leads to more complex conversations with prospects around difficult concepts. It has never been more important for advisors to hone and enhance their skills as communicators and teachers. 

A powerful communication skill is the ability to use analogies to help listeners more readily understand critical concepts. For the purpose of this discussion an analogy may be broadly defined to include a simile, metaphor, visual aid, real or fictional story. Analogies often paint vivid mental images that more easily connect with a prospect’s emotions. They also serve as a powerful memory aid to help prospects remember a main point long after they leave your office.

Those advisors who can communicate by using vivid and memorable analogies will find they have a distinct advantage in closing prospects and helping clients understand complex financial concepts.

Types of Analogies

Similes and Metaphors – Similes are the simplest of all analogies. While comparing two things that are quite different, similes actually highlight something the things have in common. Similes usually will contain the word ‘like’ or ‘as’ to make the comparison. For example, when explaining the importance of guaranteed income one might say,

“A retirement income plan without guaranteed income is like skydiving without a parachute.”

A metaphor is more forceful and direct than a simile. It speaks as though one thing were another. For example, one might say,

“Guaranteed income is the anchor of your ship.”

 A well-chosen simile or metaphor allows an advisor to make a point in a way a statement never could and they seldom require additional explanation.

Drawings – Hand drawn pictures are another simple illustrative device. They simplify complex topics without requiring advanced artistic skills.

In their book Story Selling for Financial Advisors:  How Top Advisors Sell, Scott West and Mitch Anthony share how Kay Shirley uses a simple illustration (seen at left) to explain the principle of diversification and asset allocation. Drawing the illustration on a whiteboard or notepad, she explains that each box represents an elevator. The lines at the top are elevator cables. She then asks the client, “If you were in an earthquake which elevator you would want to be in?”


Developing Analogies


Some individuals have a natural gift for storytelling, but others may need to work at it. With preparation and practice, it is a skill almost anyone can develop.

Develop Your List – It is best to begin by identifying a list of the concepts, strategies and  teaching points that are commonly used in your business that might benefit from simplification through analogy. Ask yourself: 

  1. What are the top five concepts and strategies I find myself routinely explaining to clients?
  2. Are there common objections I routinely receive?
  3. Are there any concepts I personally struggle to explain?

Know Your Audience – In the development of your analogies it is important you know  exactly who you’re to. A sports analogy might be right up your alley and great for many of your clients, but is it relevant to everyone? Ask yourself what commonalities exist among your clients and prospects. Then when developing analogies think about what would be appropriate for use with the largest number of individuals. You also might think about developing multiple analogies for the same concept so you can use what is most appropriate for different individuals and circumstances.

Develop and Find Analogies – Simple and uncomplicated analogies work best so consider drawing from items to which everyone can easily relate. For example, consider developing analogies based upon the natural world, the weather or the behavior of children. Knowing your audience can also give you a clue where to look to develop a good illustration. If you live in a state where college football is popular and many of your clients are fans, consider what analogies you might draw from the local football program.

Most important, be proactive in your desire to develop this skill. Budget time each week to work on how you can better communicate through illustration and analogy. Brainstorm different ideas. When you read or hear something that would make a good analogy, keep it in a file for easy reference.

  • What items from the natural world might I use for an analogy? (Weather, food, animals, children, etc.)
  • What interests or commonality do my clients have which would allow me to draw an analogy? (sports, occupational, geographic, etc.) 
  • What real-life client examples can I use to illustrate a concept? 
  • Did I read, hear, or see anything today that might be used as an illustration or analogy to help clients more easily understand a concept? 
  • When can I block a brief period of time each week to work on this skill? 

Remember, those advisors who can communicate by using vivid and memorable analogies will find they have a distinct advantage in closing prospects and helping clients understand complex financial concepts.