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May 05, 2013 at 03:08 PM
“One of the biggest trends I see in the next 10 years is the interconnectivity of advice and information overall,” Michael Kitces said at the outset of his Sunday afternoon breakout session at FPA Retreat 2013 in Palm Springs, Calif.
Kitces, director of research for Pinnacle Advisory Group (and a regular blogger for AdvisorOne), was joined onstage by Bill Winterberg of FPPad.com and moderator Dan Moisand, the noted planner who is Retreat 2013 task force chair, for “FutureThink: Future Scenarios for the Creation, Delivery and Tracking of Financial Planning.”
So what did he mean by the statement?
“Traditionally, financial planners have acted as the ‘Wizard of Oz,’ Kitces explained. “They’ve disappeared behind the curtain and emerged a while later with this plan. We all know how often clients would then read that plan, which was seldom.”
Kitces compared the adoption of a plan by a client to buying a car. While they might research a car online, they won’t buy it until they’ve taken it for a test drive to test things like the sensitivity of the brakes and the overall comfort they feel.
“That’s what they’re doing when they’re asking us ‘What if?’ questions,” He continued. “They’re test driving the plan in all sorts of different scenarios. We take it back and make the requested changes and about the seventh time we do it, they start to get the picture that we’re not enjoying it anymore, so they stop asking.”
Because they haven’t fully test driven the plan, adoption of the plan is typically low, Kitces said.
