Yet it is THE one skill that continues to be completely overlooked by the financial services profession. In fact, having presented to around 3,000 IFA’s in the last 5 years, my own research has identified that over 80% of Advisers freely admit
Most Advisers admit to being ‘self taught’ (which probably explains why most Advisers do the job completely differently). Many more Advisers confess to doing what amounts to a ‘product based’ fact find - more accurately referred to as a 'GAP Find' - often designed by their ‘compliance department’! Aaargh! Danger! Danger! Danger!
Perhaps that is why, right now, an Adviser can be a Certified Financial Planner, or a Chartered Financial Planner, have a Degree in Financial Services (perhaps all three) and yet never have been taught (or tested) on the MOST IMPORTANT part of the job – proper Fact Finding skills!
What about you?
If the answer to these questions is YES! Then fantastic! I would love to hear from you to find out about your experiences? (email@example.com) In fact, I'll bet that if you were taught these skills, then that was way back in the ’80′s! (Bring back the best bits of the 80′s I say! )
Going ‘off track’ is an easy thing to do. The Financial Services Industry does all it can to keep Advisers heads focused on products and investments. So it’s not surprising that Advisers ‘Fact Finds’ are product/investment/risk profiling based, rather than 'client focused’. And once you fall into the ‘product based discussion trap’, it’s very hard to then build a genuine ‘Financial Planning’ relationship.
The ‘Industry’ also emphasises the ‘hard, technical, detail’ knowledge that you need to have (or are expected to have) to properly advise your clients.
So, all in all, it’s not surprising that many advisers have lost the plot. (It’s not their fault, it's the 'Industry's' fault - THEY made you do it!)
And guess what? The more ‘qualified’ and ‘knowledgable’ you become, the bigger the temptation to ‘show what you know’.
But what about the ‘soft stuff’?
It’s the ‘soft stuff’ that builds ‘solid’ trusting relationships with clients. The ability to ‘connect’ with a client; to create empathy and trust; to really get to know your client. That’s what good 'fact finding' is all about!
As you may know, since the early 90′s I’ve been describing my ‘Fact Finding Process’, as that of ‘Lifeplanning’. It is THE most important part of the advice process.
NO NEED FOR TEARS!
You’ll be aware of the recent hype about ‘Life Planning’ and bringing your clients to tears! My process is NOT about that!
George Kinder and his EVOKE system has appealed to many people, and for good reason. For many Advisers this is the first time they have even thought about their client in this way – that it’s about them, not their money.
Hat’s off to George for waking advisers up!
But I’m acutely aware, that this also puts off an awful lot of people who find it too ‘touchy feely‘, ‘tree huggy‘ or just ‘too darn American!‘
I’m absolutely convinced, that in the right hands, George’s stuff works and works well. But I can also see how it can lead Advisers astray, often down a path which might not be financially viable. And possibly into areas where shouldn’t go – we are just not qualified to open what could be a ‘can of worms’.
More important, it’s not for everyone, particularly as ‘WE’RE BRITISH!’
Let’s keep this really simple….Successful Lifeplanning (Fact Finding) is about building trusting relationships by really finding out about your client, not their money; it’s about really getting to know their hopes and dreams; their goals; their aspirations; their fears and concerns. It’s the job of finding out what makes them tick. It’s about finding out what they are trying to achieve.
In particular, (and most important from a ‘financial planning’ point of view) it’s about identifying the type of lifestyle they have now, and the type of lifestyle they want to maintain in the future.
Contrary to what the Financial Services Industry or the Regulator may think, it’s NOT about what products or investments clients may be interested in OR identifying what products the Adviser can sell them!
Ideally it’s a process of finding out not only all the ‘soft’ facts, but all the ‘hard’ facts too, and efficiently gathering all the information you need so you can competently and efficiently move on to the next stage of financial planning. It’s the ability to ask the RIGHT questions in the RIGHT order – and then LISTEN (really listen) to the answers!
“In reality, ‘Lifeplanning’ it’s nothing more than a GREAT client focused fact find, that focuses on your client MORE than it does their money. Do this right and clients will quickly trust you with ALL their money”
You've heard of the K.I.S.S Principle. Here's another version...
Keep It Shallow, Stupid!
It might sound weird, but I teach Advisers how to keep it ‘shallow’! At least initially. Go too deep with your questioning, or try to offer a service which comes across too ‘New Age’ and there’s the risk you’ll scare clients off. For good reason! We’re British remember!
I like to help Advisers to focus on something that’s not too deep, not too ‘touchy feely’, but totally and utterly tangible….
Lifestyle is so tangible that you can see it, smell it, taste it, touch it! It’s the ONE thing that clients have worked hard to achieve. And it’s the one thing they will be sure to want to keep! In fact, when you think about it, ‘Lifestyle’ and maintaining that lifestyle, is the ‘driver’ that determines the answers to what clients want most. It determines what it's going to take to achieve Financial Independence, Financial Security, and Peace of Mind.
That’s why 'Lifestyle' Financial Planning is practical, down to earth and makes so much sense!
Better still… it works!
So, dig deep yes, but remember to also ‘keep it shallow, stupid’! Clients will relate to you more if you can get them to focus on the life they have, and the life they want to keep.
Then, all you need to do (with your financial planning hat) is SHOW THEM what they MUST DO to ensure that they CAN achieve the life(style) that THEY have identified and WHAT they must do to MAINTAIN that life(style) for the REST of their lives, without fear of ever – OR dying with TOO MUCH!
That makes clients take your service seriously, and will pay you good money in return.
Do you admit to going ‘off track’?
Has Technical Overload, Qualifications, Compliance KILLED these important skills?
Were you ever 'taught' how to do a proper fact find / discovery meeting?
Let me know what you think below.