The role of the financial planner is to first understand a client’s hopes and dreams, and then use technical knowledge and experience to establish a financial structure to achieve them.
But what if the client doesn’t know what their hopes and dreams are?
This is something that financial planners come across all the time. Many people keep their head down through life, worrying about the day to day, concern for their kids, building up wealth, repaying the mortgage. I can recall so many details about individual events in my life between the ages of 18-25, but considerably less about events from 32-40.
Few people in life have a clear idea of where they are going. Even fewer have a clear idea of where they want to go.
Part of the role of the financial planner, I therefore believe, is to be skilled in helping clients to understand themselves better.
This is one reason why I have spent two years training to be a Business Coach And Mentor (use of capitals to underline the point that it’s a qualification! Many people out there offering their services as coaches or mentors are unqualified and dispense advice based upon what worked for them, when the people they work with may have totally different values and goals. More on this here.)
So I am advocating much greater training for advisers (and paraplanners) on soft skills in a client meeting. Get husbands and wives talking about what they want out of life! I once asked two directors of a business where they envisaged being in 5 years time. “We’ll have sold the business by then” replied one. The other looked at him horrified. “I planned to work here for the rest of my life,” he said. They had never discussed this prior to our meeting.
Being a nosey person, I’ve worked in this way for years, and have improved these skills through coaching training. Interestingly, there is a often blockage that clients come up against when they start thinking about hopes and dreams. Permission.
Particularly prevalent (but not exclusive to) the older generation, the idea that they can spend money on themselves, that they are actually allowed to have what they want, is a concept many people struggle with. This is where coaching and financial planning combine most effectively. By analysing current position, and/or creating a plan for the future, the client slowly realises that it is ok for them to have what they want.
More than once we have had tears in our meeting room as we have been able to tell clients “You are now working because you want to , not because you have to.” And this has only been possible because of questioning and listing skills which have helped the client to gain clarity over what it really is that they want out of life, to set targets that they are then delighted to learn they have already achieved.
At the end of such a session, the client not only goes away having discovered goals or dreams they never realised were possible, they also have given themselves permission to do so, plus a financial plan to help them achieve it. And that is really powerful medicine.