A simple way to deal with the complicated client interface. How you do it matters.
Good plans require more than a little information about savings, income and debt. There is much more to a good plan and some of the pieces are not so obvious. We need a way to be sure we are communicating.
The article, Honest Dialogue with Clients, is helpful.
The practitioner is a former MD and suggests the medical doctor methodology called BATHE works for financial planners too. Read the article for more detail.
Here is a summary:
- B is for background. “What is going on in your life?” Listen carefully. Talk to clarify.
- A is for affect. “How do you feel about that?”
- T is for trouble. “What about that troubles you the most?” Notice “the most,” be sure to dig a little if necessary. Sometimes, the most is not really that.
These are strategic. Setting the problems in context and narrowing the field of possible solutions.
Tactics come next.
- H is for handling. “How are you dealing with that now?” This question opens the client’s mind to discuss alternatives to the method currently employed.
- E is for empathy. “That must be hard for you.” “Anyone would feel that way.” Always validate the clients decisions. All future recommendations will follow from where they are. For them, the transitions to a better alternative is easier to see if they have a comparison.
All financial planning eventually comes down to
- understand the problems,
- assess current and prospective methods and
It is easier to move ahead when everyone sees the problem and the opportunity the same way. This technique will be imperfect, but it is far better than what most of us do.
Don Shaughnessy is a retired partner in an international public accounting firm and is now with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario.
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