Financial advisors create value for clients not only by giving good advice, but also by ensuring that the advice they give is actually implemented. After all, financial planning is worth a lot more to clients when they act on the advisor's recommendations (and realize the projected outcomes), in contrast to the advisor simply handing clients "The Plan" that is never actually implemented. And yet, getting clients to implement – even when they agree with the logic of the advisor's recommendations – is notoriously tricky, and despite many advisors' best efforts, some clients endlessly procrastinate, much to those advisors' frustration.
In this guest post, Derek Hagen, financial behavior expert and founder of financial therapy and life planning firm Money Health Solutions, explains why change (e.g., taking action on their financial plans) can be so difficult for some clients, how the resistance to change often stems from a client's ambivalence about whether to change at all, and how advisors can help clients work through that ambivalence through the technique of Motivational Interviewing (MI).
Psychologists have described the process of change through a series of 6 steps, starting before the person is even aware there is a change to be made, progressing through the stage of deciding to change, and then actually making the change. But the caveat is that, in the early stages of this process, the person is not yet ready to make the change: They're still ambivalent as they consider the benefits of changing and will often delay taking any action (sometimes indefinitely) until they've resolved this inner conflict.
Successfully resolving this ambivalence often depends on internally fueled motivation; as many advisors know, no amount of education or rational argument can usually convince an ambivalent client with little motivation to take action. Consequently, by focusing conversations with clients around change, advisors can help them tap into their own motivation to work through the ambivalence keeping them from taking action on their financial plan.
One technique for framing conversations around the change process is Motivational Interviewing (MI). Rather than attempting to convince a client to take action through numbers and logic, MI is focused on accepting and respecting the client's reasons for being hesitant to change and encouraging the client to develop their own reasons to move forward. MI encourages clients to express themselves without fear of being interrupted or misinterpreted, subsequently giving them the space to develop their own thoughts that give them the motivation to change.
For example, a key skill of MI is reflective listening, where the listener repeats their own version of what the speaker has said when the speaker has stopped talking – which both ensures that the listener has understood and allows the speaker to clarify and/or continue with the line of thinking. Advisors can use different types of reflections to subtly reframe a client's thoughts in ways that encourage reassessment and exploration of new ideas – which can be what helps them finally break through the barrier of ambivalence and into readiness for change.
Ultimately, clients often come to advisors in the first place because, at least on some level, they are motivated to make a change. The key point, though, is that even though clients may desire change, their ambivalence may still be holding them back when the time comes to take action. Which means that getting clients to implement advice isn't (just) about convincing them about the 'right' course of action – it's about helping them prepare themselves to go beyond wanting to make a change and really feeling ready to make a change!
