Planners need to ask the right questions
Financial planners are not asking enough questions in their fact-find sessions with clients and this is resulting in them not understanding the true picture of a client’s needs, a business coach claims.
Adelaide-based Proper Advice director Brian Lucas said advisers are following a standard set of factual questions, but not discovering the client’s underlying feelings.
“The underlying feelings of the client are not addressed, just facts and figures needed for the Statement of Advice,” he said.
“As we all know, no two clients are alike, yet planners make assumptions about the solutions our clients need based on these factual answers.”
Lucas believes questions such as what people want to do in retirement, how they will cope with a partner being around all day and how much they spend on fixing the house should be asked.
He has created a list of 19 additional questions that should be included in the fact-find to understand the client’s state of mind before providing advice.
“The planner has to get to the client’s underlying beliefs to understand what they really want from life and their financial future,” he said.
“Not everybody wants to be the richest person.”
Approaching retirement is stressful for clients and the adviser has to understand their fears to handle the dramatic change in lifestyle.
“The longer a client has to consider their options the better,” Lucas said.
“Many 45 year olds should be asked these additional questions so they can plan with confidence the next 10 to 20 years.”
He said it is also about building a relationship between the client and the planner rather than just a transaction.
“If the planner builds a relationship with the client, then they will have no need to go to a bank to seek financial advice,” he said.
The changes to superannuation next year, where the client can take a lump sum, also makes understanding their emotional state even more important.
“It will be like people who win the lottery, most will spend the whole sum within a couple of years,” Lucas said.
“Knowing how people feel about retirement will let the planner help the client deal with the issues and understand what they need during their retirement.”
Lucas has been running coaching sessions in Australia, as well as in Malaysia and New Zealand, on extended fact finding with clients.
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