Be Seen To Be Valuable

People don’t complain about your price, they complain about your value.  That may be the basis for the media’s devaluation of the amounts advisors charge.  People do not know value until they see it.  It’s curable.

First of all people do not value advice when they think the task is easy.  Defence – do not downplay the complexity, the choices and the nuance.  If you want to be paid for what you do, it is better if you do not hide what you contribute.

At one time in the accounting business, people complained about the fees we charged to manage correspondence with the government in respect to tax.  All of it came to us.  Simple solution.  “No problem.  We will change the mailing address to your office and you can call us when you get something you don’t understand.”

Do not minimize the fee.  Free advice is not perceived to be valuable.  Research shows that people value advice more highly if they paid for it.  People undervalue free advice and overvalue paid-for advice.

Except.

If people see the problem to be easy they will undervalue any advice and if they see the problem to be difficult they will overvalue any advice.  You will understand this completely if you have ever talked to a teenager.  As they know everything, advice is generally seen to be worthless.

Help the client to be objective about difficulty.  Sometimes difficult things have prepackaged solutions.  Sometimes easy things grow difficult as time passes or as they examined more deeply.

To be a valuable source of advice is not easy.  It is pointless if the client does not see the value.  They will always see you as overpaid.

Be forthright about the difficulty, the nuance, the complexity.  Not to over do and confuse, but to preserve the proper vision.  Educate clients so they can see the problem and the solution in a realistic way and so they can see your input.  Educating clients is your best long term defence.

As always, unsolicited advice is seldom valued.  Part of the education process is helping the clients to ask for assistance.  They will not do that until they have a more complete understanding of the problem/opportunity.  Lay some groundwork.

It is wonderful to valuable; it is even better if you are perceived to be valuable.

Don Shaughnessy is a retired partner in an international public accounting firm and is presently with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario. Contact: don@moneyfyi.com

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