The Client-centred Blog

The power of simplicity in a world of complexity

The human intellectual mind loves to make things complex. And this is just as true in the financial world as anywhere else.

We could have a much simpler tax system – but we choose not to.

We could vastly simplify pensions – but we choose not to.

We could make financial products and investments simpler for consumers to understand – but we choose not to.

By keeping things as complex as they are it serves some people, but not others. Certainly not consumers.

The world of financial advice is beginning to take notice of the fact that a client’s state of mind, thinking and behaviour are critical factors in areas such as:

*Their ability to think clearly and identify their priorities
*Decision making
*Achieving their goals
*Learning from past mistakes and avoiding making them again in future
*Their sense of well-being

This is where huge potential and value exists for clients rather than simply relying upon the traditional approach of advising on financial products and investments.

Yet we are also in danger of going down the road of making things far more complex than they need to be.

Over 400 approaches!

I was reliably informed that there are over four hundred different theories and approaches to understanding and changing human psychology.

So, how the heck do you know which one to choose?

Behavioural finance seems to have become flavour of the moment. Yet as far as I can see it has gone down this path of being intellectually fascinating but offering little in terms of facilitating real change and offering value for clients.

There are at least three problems inherent in all the conventional approaches:

  1. They take no account of the practitioner’s state of mind.
  2. They try to fix people’s thinking and provide behavioural interventions.
  3. They see the cause of a person’s state of mind as being external to the person.

On the first point, I wrote about this in a blog a while back. The state of mind of the practitioner is one of the most, if not the most, influential factor in the experience the client has.

On the second point, psychologists estimate that people have between 60,000 and 100,000 thoughts a day. Many of them the same ones, repeated over and over. As I found out for myself, trying to deal with this is like a false summit. As soon as you reach it, another one appears and this just goes on and on.

If you try to deal with people’s behaviour directly it is like shutting the stable door after the horse has bolted because behaviour is after the fact of state of mind. This is precisely why helpful advice tends to fall on deaf ears and rarely delivers the promised result.

On the third point, we feel our thinking, not our circumstances. If, as practitioners, we buy into the illusion that circumstances cause feelings then we are inadvertently reinforcing the illusion in our client’s mind. You cannot effectively help a client if you also buy in to their ‘problem’. Professionals get hired to help clients solve problems, not collaborate with them in their misery.

So, what can you turn to?

William James, regarded and the father of modern psychology, observed over 100 years ago that the field of psychology had no fundamental principles. He said:

“Someday someone will find principles for psychology and when they do, it will change the field to a philosophy and a science and in turn it will help millions of people.”

These principles were uncovered by the late Sydney Banks and are helping people all over the world deepen their sense of well-being, realise more of their potential, and thrive in life.

Over the past few years well over 100 books have been written on these principles and for those who have learned and embodied them they have improved their quality of life, often significantly, and on an ongoing basis.

They also improve the impact you have upon other people because the less you have on your mind the more present you are, the better you listen and the more you see.

Albert Einstein said, “Everything should be made as simple as possible, but not simpler.”

When fundamental Principles, which are laws of nature, have been uncovered it has advanced that field in one giant leap forward. Three other such examples are germ theory, the principles of aerodynamics, and the universal law of gravitation.

The human intellectual mind has massively over-complicated our approach to psychology. If you want to see proof of this then simply look at the fact that despite all these theories and interventions the world is in a mental health crisis.

Five years ago, I published ‘The Client-centred Financial Adviser’, which laid out these psychological Principles and how they play out in adviser and client relationships.

These Principles are simple yet have infinite depth. There are no techniques, no processes, or steps to learn (because these are the product of the intellectual mind).

Instead, they give you an understanding you can utterly rely upon, without exception. As all universal principles do.

John Dashfield

John Dashfield spent 14 years as a self-employed adviser. Since 2006 he has been a coach, mentor and author helping advisers create transformations in their business and personal lives.