Journal of Financial Planning: September 2022
Kristine McManus, CRPS, is chief advisor growth officer at Commonwealth Financial Network, member FINRA/SIPC.
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Advisers fill many roles for their clients in addition to helping them manage their finances. On any given day, advisers may serve as coaches, teachers, therapists, bankers, and all-around genies-in-a-bottle when it comes to empowering clients to achieve their goals. Successful advisers have developed strong emotional skills early on in their careers, and it’s clear that their ability to empathize, adapt to change, and relate to clients is a huge factor in their professional achievements.
A Focus on Client Well-Being
Harnessing these emotional and social skills is crucial to understanding the needs of your clients and prospects. During the COVID-19 pandemic, the global prevalence of anxiety and depression increased by a massive 25 percent, according to a brief released by the World Health Organization (WHO) in March 2022.1 Just when people may have felt they were out of the woods, Russia invaded Ukraine, gas and oil prices soared, and market performance got increasingly shaky. That’s a lot for anyone to handle, and it’s important for advisers to know how closely a client’s emotional well-being is tied to their overall happiness.
Many of you feel that you know your clients well and have a finger on the pulse of their daily lives. But, if you haven’t had in-depth conversations with your clients in the past year or so, then it could be time to see what has changed in their lives and attitudes. Keeping this dialogue open is beneficial to your practice and key to strengthening relationships in your client network.
The Importance of Checking In
So, before too much time passes or you become blindsided by a client request, take steps to determine what has changed in your clients’ lives. An adviser I know shared an example of a client who abruptly shifted away from a retirement income plan that had been carefully calibrated. Rather than leaving assets in a traditional will, she decided to distribute them to her grandchildren immediately so she could enjoy their experiences.
A survey could be a great way to avoid these unexpected situations and gauge your clients’ concerns. This could also present an opportunity for you to differentiate yourself in your services. You may be able to offer helpful ideas or suggestions—or bring in outside speakers to events—once you’re aware of your clients’ current needs.
Remember to check with your compliance department before sending a survey out, and try to avoid asking open-ended questions. Here are a few sample questions that could help you gain insight into your clients’ current mental space so you can avoid being surprised.
- Are you anxious about any aspect of your financial well-being?
- Do you have growing concerns about world affairs?
- Have you offered financial assistance or care to a family member that has affected your financial health?
- Would you be interested in attending a client event with a therapist or mental health professional?
Additionally, it’s important to note that your clients’ boundaries may have shifted during the past few years. Advisers can often be pulled into personal or familial situations where they need to be empathetic and still do their jobs. To prepare for these scenarios, you can reach out to your firm partner for behavioral finance resources to help you handle these sensitive conversations and engage with clients on a deeper level.
Creating Meaningful Connections
Showing concern and compassion is the backbone for building strong relationships with clients, especially during challenging times. By letting clients know you care about their emotional wellness, not just their financial state of mind, you can better serve them. If you’re prepared to ask the right questions—and lean into your emotional and social skill sets—you can cultivate long-lasting client relationships for years to come.
Endnote
- World Health Organization. 2022, March 22. “Weekly Epidemiological Update on COVID-19 - 22 March 2022.” www.who.int/publications/m/item/weekly-epidemiological-update-on-covid-19---22-march-2022.
More from the Journal
Learn more about how planners can use psychological tools to address clients’ well-being and help them achieve outcomes beyond financial health.
“Integrating Interpersonal Neurobiology into Financial Planning: Practical Applications to Facilitate Well-Being,” Julie Fortin, CFP®, FBS, CEFT; Marlis Jansen, LMFT, FBS; and Bradley T. Klontz, Psy.D., CFP®, May 2020
“Financial Advisers as Well-Being Advisers,” Meir Statman, Ph.D., September 2019
“Time Allocations and Self-Reported Happiness of Retirees: An Exploratory Study,” Tao Guo, Ph.D., CFP®; Yuanshan Cheng, Ph.D., CFP®; Philip Gibson, Ph.D., CFP®; and Louis J. Pantuosco, Ph.D., March 2019
“From Functioning to Flourishing: Applying Positive Psychology to Financial Planning,” Sarah D. Asebedo, CFP®, November 2015
