Kitces & Carl Ep 74: Making Clients Care About Financial Planning By Finding Their (Truly) Critical Issues

Kitces & Carl Ep 74: Making Clients Care About Financial Planning By Finding Their (Truly) Critical Issues

While it was once a common practice for financial advisors to apply cold-calling strategies to attract any client willing to engage with them, framing their value in terms that clients would understand was often a challenge for advisors positioning themselves as experts able to solve all of a client’s financial problems. But when clients have financial issues that aren’t clearly obvious or understandable to them, they are generally not very motivated to have an advisor help them address their problems, especially when they don’t understand the specific services – beyond the commonly offered (yet vague) “peace of mind” promise – the advisor can provide.

In our 74th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss strategies that motivate clients to seek financial planning services, and how identifying the right areas of specialization can help advisors to better communicate how their services can help clients address their unique problems.

As a starting point, it is important to acknowledge that clients often don’t seek out help unless their problem becomes a critical pain point. For example, while regular auto maintenance is important to prolong the life of a car, it is often not considered a high priority. By contrast, being stranded with a flat tire in a strange area needs an immediate solution. Similarly, clients who don’t seek financial planning services may not have any critical needs to address; this isn’t to say they are not in need of service, they may simply not consider the service immediately relevant.

However, when a client’s problems escalate to a high level of urgency, they can become very motivated to seek out a clear solution to their issue. Accordingly, advisors can benefit from understanding these truly critical issues that matter most to their own clients and aligning the solutions they provide to their current and future clients. This can present a significant opportunity for the advisor to enhance and improve their business strategy, as communicating specific solutions available to critical problems that clients care about can minimize the indifference many clients (current and prospective) have with advisors who don’t clearly identify the solutions they offer.

Ultimately, by communicating specific solutions that are relevant to their clients’ critical issues, advisors can help clients better understand the value that they offer and enhance opportunities to expand their business. And by asking clients the right questions to identify which issues are most critical to them, advisors not only strengthen their relationships with their clients but also have the opportunity to proactively develop planning and communication strategies to attract more clients. Which, in the end, allows them to refine their financial planning services to best meet their clients’ needs!

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