Education the key to engagement: Lombardo
For clients to be fully engaged with their financial affairs they must have enough knowledge to understand what's happening and why, says business mentor Dean Lombardo.
Lombardo, who won the Association of Financial Advisers 2012 National Excellence in Education award, said the primary component of value for clients is peace of mind.
In his engagement model, Lombardo focuses on the "three pillars" of peace of mind.
Firstly, clients want a strong relationship with the person or organisation that is providing advice to them, he said.
Secondly, clients must be able to see "measurable progress" in their financial plan, Lombardo said.
"People who've gone through a financial planner have effectively embarked on a journey to achieve goals or a particular purpose in a future point in time. ‘Measurable progress' means: am I actually on track to get to those outcomes?," he said.
Finally, clients need knowledge and empowerment when it comes to the detail of their financial plan, Lombardo said.
"It's about educating the client, and opening up the veil of secrecy so the client can see their longer-term plan — based on shorter milestone moments where there is mutual accountability from both the planner and the client," he said.
The Effortless Engagement ‘Benchmarking' model is underpinned by adult learning theory principles, said Lombardo.
"It's largely about the engagement model and the financial planner having a relationship with the client. It's about mentoring and educating and actually having a dialogue rather than a monologue," he said.
AUTHOR
Staff Writer
Recommended for you
Sequoia Financial Group has announced it is selling off its Informed Investor subsidiary which it acquired in April 2022.
Wealth Data has examined which advice business model has seen the most growth since the start of the year including those that offer holistic advice.
Research conducted by Elixir Consulting and Lonsec has quantified the efficiency gains of using managed accounts in financial advice practices in hours per week saved.
With only one-quarter of advice practices actively seeking feedback from clients, the Financial Advice Association Australia has emphasised why this is a critical tool for client retention.
