Behavioral Finance | Kitces.com

#FASuccess Ep 101: Financial Advisors As Adherence Partners To Deliver Advice That Actually Sticks with Moira Somers

December 4, 2018 07:03 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 101st episode of Financial Advisor Success Podcast!

This week's guest is Dr. Moira Somers. Moira is a clinical neuropsychologist who studies the complexities of how hard it is for people to change their behaviors, especially when it comes to money.

What's unique about Moira, though, is the way that she's applied her financial psychology expertise not just to consumers themselves, but to how advisors can more effectively help their clients. Specifically by teaching advisors how to better deliver advice itself in a way that actually sticks so their clients really do change their behaviors for the better.

In this episode, we talk about the growing base of research from the medical field about what doctors need to do to make their patients better comply with the drugs and other therapies they're prescribed. How that patient compliance research is being applied to financial advice to help clients better adhere to their advice, the role of a financial advisor as an adherence partner to help clients follow through on advice, and why it's unrealistic to expect even well-intentioned clients to always follow through on good advice they may be given.

We also talked about specific steps that financial advisors can take to improve their advice delivery in a way that increases adherence from clients. From better assessing client readiness to actually take and implement the advice, to giving better follow-through support on the implementation of advice, why it can be a good and valuable service to occasionally nag clients, and why Moira starts out every meeting with the simple question, "What would make this meeting the best use of your time today?" to ensure that the conversation is always focused on what really matters most to the client in the moment.

And be certain to listen to the end, where Moira talks about the importance of actually measuring client adherence. Why advisors should consider tracking how quickly and consistently their clients implement their advice or not, and why better delivery of advice that sticks can actually help to both justify and even reduce the cost of financial advice itself.

So whether you're interested in learning the bests ways to help clients stick to the advice that we, as advisors, give them, how to give clients better follow-through support, and why it's important to track how consistently clients implement the advice they're give, the we hope you enjoy this episode of Financial Advisor Success.

#FASuccess Ep 091: Increasing The Value Of Advice By Focusing On Life-Centered Planning For Transitions Not Goals with Mitch Anthony

September 25, 2018 07:03 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 91st episode of the Financial Advisor Success podcast!

This week's guest is Mitch Anthony. Mitch is the founder of an eponymous training and coaching firm for financial advisors on how to ask the right questions to have better conversations with clients.

What's unique about Mitch, though, is his truly unique gift for finding the right words for effective client conversations. From describing the value of financial planning itself based on the six principles of helping clients with their organization, accountability, objectivity, proactivity, education, and partnership, to simply making the point that in the end, the role of a good financial planner is to help clients find the balance between vocation and vacation and ensure that clients prepare so they don't have to repair instead.

In this episode, we talk about the importance of language in financial planning. The difference between having good rapport with clients and really building a relationship with them, why asking clients the right questions is all about engaging them by making them feel like they're answering the questions they've always wanted to talk about anyway, and why the best way to demonstrate the ongoing value of financial planning is not about helping clients to reach their goals, but instead helping them to prepare for and then navigate the never-ending stream of transitions that life throws at them anyway, which are also great opportunities for advisors to demonstrate our value and grow our businesses because money goes in motion when life goes into transition.

We also talk about how the real value of a financial advisor should be measured by their ability to impact a client's return on life and whether they're living the best life they can with the money they have, rather than the traditional focus on benchmarking and advisor's return on investments, which as Mitch puts it, Standard and Poor's is a poor standard for measuring value, how the life-centered planning approach helps to address the common client question of, "What have you done for me lately," and the platform that Mitch is building aptly called ROL Advisor, to provide coaching and tracking tools that advisors can use with their clients to demonstrate these ongoing values.

And be certain to listen to the end, where Mitch shares his key insight for how new advisors, in particular, can set themselves on a better track to long-term success by doing whatever it takes to, as he puts it, surround themselves with greatness and find opportunities to learn from best advisors they can before starting out on their own.

So whether you're interested in learning about how "life-centered" planning improves client relationships, the "major motivator" for saving (other than retirement), or the best way to demonstrate the ongoing value of financial planning, then we hope you enjoy this episode of the Financial Advisor Success podcast.

#FASuccess Ep 088: Learning A More Genuine Sales Conversation Approach To Better Turn Prospects Into Clients with Nancy Bleeke

September 4, 2018 07:07 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 88th episode of the Financial Advisor Success podcast!

This week's guest is Nancy Bleeke. Nancy is the founder of Sales Pro Insider, a sales training platform for financial advisors that teaches how to better turn prospects into actual clients.

What's unique about Nancy, though, is her somewhat non-traditional sales training approach, which isn't about pushing features and benefits and going for the hard close, but simply about having a structure to the conversation that occurs in an approach talk with the prospect to ultimately help them make a decision or take an action at the end. Because the reality is, even if you're in the business to get paid for your advice and not to sell your company's products, you still have to sell someone on the reason why they should hire you and pay your fee in the first place.

In this episode, we talk in depth about Nancy's WIIFT structure to the sales conversation, which is both focusing on the "what's in it for them" of the WIIFT acronym, but also a five-step conversation process of wait and prepare, initiate, investigate, facilitate, then consolidate. The importance of asking more questions to really understand a prospect's context so that you can refine and right-size the information that you give them, and the dangers of giving prospects more information than they actually need in a manner that can just put them into analysis paralysis instead of helping to motivate them to take an action or make a decision.

We also talk about the actual key questions to ask a prospect throughout the meeting process. From setting an agenda with them in advance of every meeting to ensure you're really discussing what they want to discuss, asking what it is that brought them to the meeting to begin understanding what their real problems, opportunities, wants, and needs are, asking prospects for feedback about how your services and proposal sound to them as you describe it to them, and being certain at the end of a meeting to actually ask for their business and making it crystal clear what the next step would be in order for them to proceed.

And be certain to listen to the end, where Nancy explains why the biggest and most common problem that financial advisors make in trying to get new clients is our tendency to try to convince clients that they need a financial plan in the first place, instead of listening to what they actually want and need and relating the benefits of financial planning to their problems and concerns.

So whether you're interested in learning about building a more effective framework around your conversations with clients, how to demonstrate your expertise in a way that builds trust, or how to structure meetings to increase conversion rates, then we hope that you enjoy this episode of the Financial Advisor Success podcast.

#FASuccess Ep 081: Expanding Access To Financial Planning Advice By Offering Financial Doing Instead with Louis Barajas

July 17, 2018 07:02 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 81st episode of the Financial Advisor Success podcast!

This week's guest is Louis Barajas. Louis is the founder of Wealth Management LAB, a multi-family-office style advisory firm in Los Angeles that specializes in providing financial advice and business manager services to entertainers and other celebrities in the Latino community.

What's unique about Louis, though, is the way that his advisory firm has evolved over time, from trying to serve Latino small business owners in the barrio where he grew up, to writing books and teaching financial literacy to the Latino and broader community, and now focusing on a business that is not just about financial planning, but what Louis calls "financial doing" instead.

In this episode, we talk about Louis' path into financial planning, from helping his father prepare tax returns and keep the business books as a teenager, to starting out with a broker-dealer in the 1980s but quickly getting tired of the pressure to sell products at the end of every financial plan, getting his CPA license and shifting to an accounting firm that worked with high-net-worth individuals, and then leaving the accounting firm to start his own solo practice after a chance meeting with pastor Rick Warren in a coffee shop, shortly before the pastor published his Purpose-Driven Life book, and how that 30-minute coffee shop conversation changed the trajectory of Louis' career forever.

We also talk about how Louis built his advisory firm over time, the setbacks he had that forced him to nearly start over from scratch twice after he had to split away from former business partners and associate advisors, because as he's learned you can have multiple partners in a business but only one Visionary, the Abundance Mentality Louis brings to the table that has allowed each new iteration of his business to grow even larger than the past, and how Louis building more successfully than ever this time with a focus on hiring for heart and teaching the skills, while putting a series of Core Values – or what Louis calls "Immutable Laws" – in place for the business, that serve as a guidepost for the entire team about the deliberate culture of the firm.

And be certain to listen to the end, where Louis talks about why he believes that not just financial planning, but financial doing for clients, is the key to expanding financial advice to a broader range of underserved consumers.

So whether you are interested in learning more about expanding access to financial planning advice to traditionally underserved communities, learning more about how financial "doing" differs from financial planning, or how an Abundance Mentality can help you grow your firm, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 076: Why Financial Therapy Beats Financial Advice To Help Clients Change Their Behavior with Kristy Archuleta

June 12, 2018 07:01 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome, everyone! Welcome to the 76th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Kristy Archuleta. Kristy is an Associate Professor in the financial planning program at Kansas State University, with a focus on teaching advisors how to actually change their clients' behaviors for the better.

What's unique about Kristy, though, is that she's also a licensed marriage and family therapist, and comes to the world of financial planning and how to help clients improve their financial behaviors with the perspective of a trained psychologist.

In this episode, we talk in depth about Kristy's work at the intersection of financial planning and financial therapy, how a financial therapist would view common financial planning challenges from a different perspective with different solutions, the way that therapists approach helping clients to change their behavior by recognizing that clients are the best experts in their own lives, and why according to the best practices research of therapists themselves, what financial advisors typically do – give advice with a comprehensive list of recommendations to their clients about how to improve their financial lives – is actually not a good way to get them to change their financial behaviors for the better.

We also talk about Kristy's work in helping to co-found the Financial Therapy Association, the development of a new Certified Financial Therapist (or "CFT") program they're developing, why Kristy anticipates that financial therapy will eventually become a specialization path for financial planners... and where the line should still be drawn between the end of what advisors can do by providing financial therapy, and when it may still be necessary to involve a fully licensed mental health professional on the client's behalf.

And be certain to listen to the end, where Kristy talks about her own upcoming transition, from teaching financial planning and financial therapy at Kansas State University, to joining the financial planning program at the University of Georgia, to hopefully help them build more insights from financial therapy into their core financial planning curriculum as well.

So whether you are interested in learning more about the intersection between financial planning and financial therapy, how financial therapy can help clients improve their financial behaviors, or how financial therapists can become certified through programs such as the CFT, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 059: Systematizing The Financial Life Planning Process To Increase Your Money Quotient with Carol Anderson

February 13, 2018 07:01 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome, everyone! Welcome to the 59th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Carol Anderson. Carol is the founder of Money Quotient, a 501(c)(3) non-profit organization in Portland, Oregon that provides financial life planning training to advisors.

What's unique about Carol and Money Quotient, though, is the way they have systematized the process of doing financial life planning for clients.

In this episode, we talk in depth about the 5-meeting financial life planning process that Money Quotient has developed, built around their 5-E stages of Explore, Engage, Envision, Enlighten, and Empower, how advisors can use standardized survey tools regarding a prospective client's financial well-being and potential life transitions eto set a more holistic tone to a financial planning engagement from the start, the way Money Quotient segments the qualitative data gathering process into Satisfaction and Values, Biography, Transitions, and Goals, and the meeting templates they've developed to systematize every step of the process along the way.

We also talk about the psychology and sociology research and theoretical framework that underlies the Money Quotient approach – as they are a uniquely research-based organization in developing their financial life planning framework – the 3-day training program they've developed to teach advisors about their communication tools, and why Carol doesn't consider financial life planning to be an alternative to traditional financial planning, and instead simply views it as a better way to help clients develop the self-awareness they need to truly identify the goals that will really improve their own well-being.

And be certain to listen to the end, where Carol shares her own story about developing Money Quotient, the challenges she faced when her initial partnership didn't work out well, how her daughter ultimately pulled her back into the business, and how Money Quotient is now seeking to grow its own footprint. Because the reality is that the challenges of building a business are equally applicable to both us as financial advisors, and the service providers who work with and train us, too.

So whether you are interested in learning more about Money Quotient's financial life planning process, curious what insights psychology and sociology may have for financial planners communicating with clients, or want to learn more about building a business servicing financial advisors, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 053: How Compassionate Communication Makes Us “No Longer Awkward” With Grieving Clients with Amy Florian

January 2, 2018 07:01 am 4 Comments CATEGORY: Financial Advisor Success Podcast

Welcome, everyone! Welcome to the 53rd episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Amy Florian. Amy is the founder of Corgenius, a consulting firm that teaches and trains financial advisors about how to work better with grieving clients.

What's fascinating about Amy, though, is that she actually is a trained Thanatologist – one who studies death, loss, aging, transitions, and the various forms of grief. A path that first started for her when she unexpected become a young widow herself at the age of 25 with a 7-month-old son after a tragic car accident, and ultimately evolved into running a support group for widows, getting a Master's degree and becoming a Fellow in Thanatology, and over the decades has expanded into conference presentations, workshops, a master class, and a series of books, with a primary specialization in working with us as financial advisors.

In this episode, we talk in depth about the real challenges as a financial advisor when trying to work with clients who are grieving, why the grieving process isn't just about death and dying but any time someone has a break with an attachment – which can even include the break from the attachments of existing social relationships and personal identity when someone retires – and how in the end our job as advisors working with grieving clients isn't about trying to make them feel happier, but simply to comfort them as they go through their own healing process. Even if that means there's a lot of crying.

Unfortunately, though, in practice this isn't what most of us tend to do when faced with situations of death, dying, and grief. Because these are situations that most are never trained to handle in the first place. Accordingly, Amy shares her expert perspective on how to be "No Longer Awkward" with grieving clients, what we should do and say to really comfort them, why saying "How are you holding up?" or "Is there anything I can do?" is not actually helpful for those who are grieving, why it can be even worse to try to hand a box of tissues to a crying client in your office, and why it's better instead to ask "What do you wish people knew about what this is like for you?" or simply "What kind of a day is this for you?".

And be certain to listen to the end, where Amy talks about how even though we as financial advisors aren't meant to be professional grief counselors, that ultimately we can be "grief companions" that provide our support... beyond just trying to help with the financial issues that arise in times of grief.

So whether you have been curious about how you can be less awkward around grieving clients, the specific challenges financial advisors should expect when working clients suffering a break with some type of attachment, or curious about the role advisors can play beyond just addressing financial issues that come during times of grief, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 051: What Robo-Advisors Can Teach Human Advisors About Evidence-Based Behavioral Finance with Dan Egan

December 19, 2017 07:01 am 3 Comments CATEGORY: Financial Advisor Success Podcast

Welcome, everyone! Welcome to the 51st episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Dan Egan. Dan is the Director of Behavioral Finance and Investments at Betterment, the so-called "robo-advisor" that now manages more than $12 billion of assets under management for over 300,000 clients.

What's fascinating about Dan, though, is not simply that he was an early employee and Director at Betterment as the company as grown, but specifically his role as the Director of Behavioral Finance at a robo-advisor. In a time when the primary criticism that financial advisors levy at robo-advisors is their supposed inability to help clients with their behavioral issues when it comes to investing.

In this episode, we talk in depth about the nature of the "robo-advisor" movement, why the reality is that Betterment and its ilk aren't really in competition with financial advisors because they serve a different kind of consumer with different needs, how Betterment over the years has built an increasingly more robust goals-based financial planning process for its clients, and the challenges and opportunities that come with trying to deliver financial planning and investment advice at scale - in a world where Betterment serves more than 300,000 clients, while the typical advisory firm has no more than about 100 clients per advisor.

We also talk about what Betterment is doing specifically from the behavioral finance perspective, how Betterment is actually testing behavioral finance interventions to help their clients using a robust scientific process, the kinds of evidence-based insights they're gleaning about how we can help clients better – including how the conventional wisdom of strategies like "proactively communicating with clients during times of market volatility" can actually backfire – and the ways that companies like Betterment may actually be better positioned to help clients with certain behavioral issues, because unlike most financial advisors Betterment doesn't have to rely on third-party technology firms and instead can build its technology tools to nudge clients in the exact direction they need.

And be certain to listen to the end, as Dan discusses some of the insights he's gleaned about where and how human advisors will continue to be superior to technology in some areas, even as technology makes other aspects of what advisory firms do less and less valuable and more automated for everyone.

So whether you have been contemplating offering your own robo-advisor solution, are interested in how you can better incorporate insights from behavioral finance into your practice, or are curious about the areas in which human advisors will continue to be superior to technology, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 039: Using Behavioral Assessment Tools To Really Understand A Client’s Wealth Building Potential with Sarah Fallaw

September 26, 2017 07:01 am 1 Comment CATEGORY: Financial Advisor Success Podcast

Welcome back to the thirty-ninth episode of the Financial Advisor Success podcast!

My guest on today's podcast is Sarah Fallaw. Sarah is the founder and president of DataPoints, a technology company that is creating behavioral science and assessment tools for financial advisors to use to better assess, understand, and coach their clients' financial behaviors.

What's fascinating about Sarah's work with DataPoints, though, is the way that they have applied research rigor to the fundamental question of: what are the financial behavioral traits that lead people to actually turn their income into wealth. As advisors, many of us are already familiar with the concept of the mild-mannered "Millionaire Next Door" who, through steady frugal savings behaviors, has managed to accumulate substantial wealth, without being flashy about it. Well, as it turns out, that original research was done by Thomas Stanley - who was Sarah Fallaw's father - and it's his initial work that she has now extended even further, and turned into a series of assessment tools for advisors to use with our clients!

In this episode, we talk about Sarah's research on how people build wealth, the key financial behaviors and traits - including conscientiousness, financial literacy, frugality, planning, responsibility, confidence - that lead to building wealth, why and how they measure "social indifference" (how sensitive you actually are to trying to keep up with the Joneses) to understand someone's wealth building potential, and the way that they've turned all of this research into a series of assessment tools that we as advisors can use... whether it's giving the assessment to young accumulator prospects to really understand how likely they are to save and accumulate wealth, or to give it to new or even existing clients just to better understand where their strengths are, and where their potential financial challenges will be in the future. We even explore how these kinds of behavioral assessment tools could even become a way to show the true value of financial advice - where we provide the assessment to clients year by year, and actually show them not just how they're accumulating wealth over time, but how we're actually helping them to change their financial attitudes and behaviors for the better!

And be certain to listen to the end, where Sarah talks about the challenges in actually launching a technology company that provides solutions for advisors, how "perfection can definitely be the enemy of good" when it comes to getting a new company launched (true for both technology and advisory businesses!), and why - even when it comes to starting a technology company - it's still all about focusing in on a narrow niche of the particular type of target clientele (or target financial advisor) that you want to serve.

So whether you've been curious to learn more about the research on what actually leads to wealth-building behavior, are curious about a new technology solution you could use to identify clients (or even prospects) with good wealth-building potential, or simply want perspective on what it takes to build a successful business, I hope you enjoy this episode of the Financial Advisor Success podcast!

#FASuccess Ep 014: Validating Your Advisor Value Proposition And Overcoming Imposter Syndrome With Carl Richards

April 4, 2017 07:01 am 11 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back for the fourteenth episode of the Financial Advisor Success podcast!

This week’s guest is Carl Richards, a financial advisor who has successfully grown and sold his own advisory firm, but to most financial advisors is best known as the creator the famous “Behavior Gap” sketch (of the difference between investment and investor returns), and an industry writer and speaker on how to better communicate with clients about complex financial issues.

Carl has a career that many people would be envious of. He’s worked for top-notch financial planning firms, built his own RIA, written two books, publishes a column for The New York Times, and travels internationally to speak to financial advisors around the world about financial planning. Yet ultimately, like so many of us, Carl still faces his own self-doubts about whether the value he provides is really worth what he charges (despite all evidence to the contrary!), a phenomenon known as the “imposter syndrome” that can threaten anyone’s success.

In this episode, Carl shares his story, from accidentally falling into the securities industry, to building an advisory firm, starting his Behavior Gap platform and getting a regular column in the New York Times, how his speaking career built to the point that he’s now paid $10s of thousands of dollar to give a speech, and what he’s learned about the imposter syndrome, and why many great financial advisors constantly question whether or not they’re providing enough value for their clients given what they pay (despite the fact that our client retention rates suggests the overwhelming majority of clients are happy with what we deliver to them!).

And be certain to listen to the end, where Carl talks about how he sees the future of financial planning changing, to a world where technical competency is just the minimum tables stakes to be a financial advisor, why communication skills will be the real key to success going forward, and his number one tip on what any advisor can/should do to get better at this themselves.

So whether you’re struggling to achieve success because you doubt your own value to clients, or if you’re already successful but still nervous that you may not be providing enough value to keep your clients in the long run… or you’ve simply been curious to hear the story of Carl Richards himself, I hope you enjoy this latest episode of the Financial Advisor Success podcast!

#FASuccess Ep 101: Financial Advisors As Adherence Partners To Deliver Advice That Actually Sticks with Moira Somers

#FASuccess Ep 091: Increasing The Value Of Advice By Focusing On Life-Centered Planning For Transitions Not Goals with Mitch Anthony

#FASuccess Ep 088: Learning A More Genuine Sales Conversation Approach To Better Turn Prospects Into Clients with Nancy Bleeke

#FASuccess Ep 081: Expanding Access To Financial Planning Advice By Offering Financial Doing Instead with Louis Barajas

#FASuccess Ep 076: Why Financial Therapy Beats Financial Advice To Help Clients Change Their Behavior with Kristy Archuleta

#FASuccess Ep 059: Systematizing The Financial Life Planning Process To Increase Your Money Quotient with Carol Anderson

#FASuccess Ep 053: How Compassionate Communication Makes Us “No Longer Awkward” With Grieving Clients with Amy Florian

#FASuccess Ep 051: What Robo-Advisors Can Teach Human Advisors About Evidence-Based Behavioral Finance with Dan Egan

#FASuccess Ep 039: Using Behavioral Assessment Tools To Really Understand A Client’s Wealth Building Potential with Sarah Fallaw

#FASuccess Ep 014: Validating Your Advisor Value Proposition And Overcoming Imposter Syndrome With Carl Richards

Nerd’s Eye View Praise

Nerd’s Eye View Praise

Showcase YOUR Expertise

Stay In Touch

Questions?

Please contact your Firm's Group Admin

Nerd’s Eye View Praise

Showcase YOUR Expertise

Stay In Touch

Questions?