Sometimes it can be easy to misconstrue financial planning as a purely logical industry, as clear-cut as analyzing the numbers, adding expertise, and then giving clients the requisite recommendations. However, as all advisors quickly learn in the field, personal finance is often more personal than it is finance. The emotional ties that people have to money understandably manifest in many ways, and figuring out what clients want out of the financial planning relationship is sometimes contingent on getting clients to express what and why things are important to them. In short, because finances are deeply personal, good advice is built not just on a foundation of expertise and recommendations that accounts for the client’s capacity, but also on an emotional connection that allows the advisor to identify the client’s overall vision based on their values. By adopting a “coach approach” to financial planning, advisors focus on giving advice that clients will actually follow and that adapts to their changing financial circumstances and emotional priorities.
There are different coaching methods that advisors can use to better visualize and comprehend client goals, each that focuses on different aspects of how coaches can better connect with their coachees. This may range from client self-discovered solutions (International Coaching Federation Model) to an in-depth drill on who is sitting across from them to avoid giving the wrong advice or solving the right problems for the wrong reasons (the Who, How, What Coaching Model). Or it may focus on bridging the gap between what’s ‘Here and Now’ for the client and their desired outcome of ‘There and Then’ (Coach U Strategizing for Success Model). Each coaching method has its own emphasis, which advisors can choose to play to their strengths – or stretch themselves to learn new skills!
Once a client’s goals are clearly visualized, there still remains the issue of action, and at the same time, overcoming inaction. To this end, advisors can guide clients through areas that may be blocking their progress, such as by helping them tackle important tasks that have been difficult for them to complete. If a client feels reluctant or paralyzed by negative emotions, it may help to explore and identify options that clients may not have previously realized were available to them. Lastly, advisors can set up a systematic process with tools such as LifeCards and LifeMaps that can help clients lay out what their specific priorities and goals are—and give them something to be motivated about.
Ultimately, the key point is that advisors can consider a ‘coach approach’ as an effective way to bridge the gap between their technical knowledge and helping a client apply it to the relevant things that matter most to them. It can be leveraged to both onboard new clients and help existing ones move into action. Furthermore, when advisors use a coach approach, they place themselves at the intersection of a client’s life and money, which ultimately helps clients realize their life goals and achieve their desired quality of life!