Too often, this is the experience that financial professionals encounter in their daily work. But humans disproportionately focus on what feels good here and now. This book is full of solutions to this all-too-common problem. A worn and dog-eared copy belongs on the bookshelf of every financial advisor who views financial planning as a calling and a profession. Executive Summary As the pressures of commoditization on investment advice continue to increase, more and more advisors adopting financial planning and wealth management services for their clients. As a financial planner, I know that when my advice goes unimplemented, the well-being of my clients is compromised, opportunities are lost, and the professional relationship grows strained.
And when you read it, you'll want your clients to read it, as well. Advisers contribute to non-adherence when they use language and concepts that are not familiar to the clients, when they dominate meetings by talking too much, and when they take a judgment-laden, critical stance towards clients. Those are the money-in-motion times when short-term emotions can hijack their best thinking. Advisers can contribute mightily to the problem of advice being ignored. And committing to being proactive means the advisory firm needs to run efficiently enough to actually have the time and opportunity to be proactive with clients.
Which means in practice, a client must be in some non-trivial amount of unsettled discomfort to be willing to go through the trouble of finding and hiring and paying for and then hopefully taking advice from a financial advisor. Of course, the caveat is that just saying you can deliver on these value propositions to clients is one thing; actually doing so is another. The client makes one decision. The authors of Changing for Good a classic book on behavior change claim that, at any given time, only 20 percent of us are ready to bridge that intention-action gap. Do you want to have a practice that offers clients and their families something robo systems can't? Moria's conversational, down-to-earth style of writing is easy to read and easy to absorb. A worn and dog-eared copy belongs on the bookshelf of every financial advisor who views financial planning as a calling and a profession. Financial adviser training, alas, has not kept pace with this field of knowledge.
You want to demonstrate that you are actually basing your opinion on something. There are cited in this article, which can be found at the bottom of the page. Instead, the advice-giver themselves has a proactive role to play in aiding clients to follow-through and implement, and in reality the client who faithfully and fully implements all their advice the first time and never needs help on follow-through again is not the paragon of being a good client but more the exception to the rule for how most people actually struggle to implement even good advice. You can offer support in other ways. Would you use this language on your website and in your marketing materials to describe your value proposition to clients? Even though you are offering advice, remember that you are not actually the one making the decision. Moira Somers explores how the adherence research on advice can be applied to the world of financial advisors to actually increase the likelihood that clients really do follow through on all of their recommendations. A good rule of thumb is that you should not offer unsolicited advice.
Individual client psychology plays a role in non-adherence; so, too, do sociocultural and environmental factors, general advice characteristics, and specific challenges pertaining to the emotionally loaded domain of money. Ensure that all team members understand that adherence is a responsibility they share jointly with your clients. It takes a bit of time to establish a relationship and make sure people are giving you the full monty — disclosing fully. Advice that Sticks takes aim at the problem of financial non-adherence. Perhaps most surprising, however, is the extent to which advice-givers themselves can foil implementation.
The advice is sound; the client seems eager; and then… nothing happens! Then this book is for you. It can drive client objections underground. An advisor can provide confidence-building validation as an informed second opinion. This book will change all that. New Book from Moira: Advice that Sticks How to Give Financial Advice that People will Follow If you give advice of any kind for a living, then you know how hard it can be for clients, patients, or customers to follow your wise counsel. In what may be one of the best clear descriptions of the key value propositions that financial planners provide, financial life planning pioneer Mitch Anthony boils it down to six key phrases: we provide Organization, Accountability, Objectivity, Proactivity, Education, and Partnership.
An advisor often supports relationships that go beyond just the client themselves. So what do you think? The saying that doctors make the worst patients is a cliché for a reason. It led to interesting poolside conversations. With this in mind, then, non-adherence is best understood as the norm, not the exception. As an advisor myself, no matter how many initials of alphabet soup I have behind my name, if the client does not take action on the counsel given, then all my study and time with the client is for nothing. What emerges is a thoughtful, funny, but above all practical guide for anyone who makes a living providing financial advice.
What else might that sort of debating result in? An advisor helps to highlight which information actually matters the most. I am only 30 pages in and Dr. Moira Somers has integrated her extensive clinical and consulting experience with research findings from the fields of neuroscience, behavioural economics, medicine, and positive psychology. Which makes it especially difficult to find words of support and encouragement from friends and even family in the midst of making difficult financial decisions or changes. Make sure that your advice will actually help the other person. Many planners are comfortable taking on that risk with their own money but would be reluctant to ever suggest a client do the same.
Maybe you have a friend who is facing a major life decision. Then figure out what you need to say and make sure to deliver your message clearly and in a supportive way. Overconfidence is one such cognitive bias that often affects advisors, says Stephen Wendel, head of behavioral science at Morningstar. It's an easy read full of useful tips that can be implemented right away. Excludes: China, Georgia, India, Pakistan, Russian Federation, Albania, Austria, Belgium, Bosnia and Herzegovina, Bulgaria, Croatia, Republic of, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Monaco, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Ukraine, United Kingdom, Costa Rica, Dominican Republic, El Salvador, Haiti, Honduras, Philippines, Vietnam, Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru, Suriname, Uruguay, Venezuela, Canada, Mexico, Egypt, Eritrea, Libya, Nigeria, Somalia, Iraq, Israel, Saudi Arabia, Turkey, Yemen. And not only do consumers have ever-growing access to more and more information directly and for free, but. It will become an indispensable handbook for people working with clients across the wealth spectrum.