This article looks at an important aspect of asking financial planning questions that often gets neglected and yet can add massive value.
Often, financial advice is triggered when something happens or is going to happens in a client’s life. For instance, the sale of a business, divorce, or an upcoming retirement.
Financial advisers are used to dealing with the money but there is another aspect of change which is often overlooked and this can be a huge disservice to the client.
The significance of life transitions
Imagine you own a business. It is like your baby and you nurtured it from birth, through the growth years and into maturity. You have poured your heart and soul into it and you have experienced every emotion possible along the way and have a thousand stories to tell.
It is time to sell but are you emotionally ready?
Whatever significant roles you have in life, an upcoming change can bring with it more challenges than just the financial ones.
Meaning is everything
Some years ago I learned about the work of Lyndon Duke. He was a psychologist who studied something called the linguistics of suicide. Through examining the language in thousands of suicide notes Lyndon began to see a recurring pattern. He found that people who commit suicide perceive their lives to be of no or little meaning.
There is a wider implication to this. Essentially, we become psychologically happy, high functioning, and productive human beings when our lives have meaning.
When a significant life event such as selling a business, divorce, or retirement happens it can easily create a void of meaning in a person’s life.
The nature of modern life
As Frederic M. Hudson observed in his book ‘Life Launch’, our lives will have many cycles and chapters and we will experience endings, transitions, and new beginnings.
Psychiatrist Elizabeth Kübler-Ross observed that grief could be divided into 5 stages:
Experiencing a significant life transition will often mean a person going through some version of the above before settling into a ‘new normal’. When people are not prepared the consequences can be serious.
Ask more questions
When your client is facing a significant life change, or a transition, are you exploring the wider context with them?
Although an ever-increasing number of financial planners are now realising the value of increasing their skill set, including asking questions, some hold back. So, what is it that stops financial planners asking more questions?
1. Making assumptions
There can be many reasons we make assumptions, which is the complete opposite of asking questions. It can be being in too much of a hurry. Feeling under pressure to complete the business. Or just a habit. Making assumptions can seem like the path of least resistance and yet it diminishes conversations and relationships.
2. Going into problem solving mode
If a client shares a problem you know you can solve, what do you do? Many advisers jump on it straight away. They see an opportunity to win business, prove their expertise, or just because they are trained to solve problems and it looks helpful. But how do you know if the first thing that comes up is the real problem? In fact, it probably isn’t.
3. Fear of the unknown
When you get deeply curious by asking more questions you are exploring the unknown. This goes completely against the advice of many so called ‘experts’ who tell you that must maintain control of a meeting. Yet wouldn’t it be better to know that you can confidently handle absolutely anything that might come up in a conversation?
Asking essential financial planning questions: the ones that no one else thinks to ask
Financial planning questions are most powerful when they are spontaneous, within an appropriate context, and cause the recipient to pause and reflect.
The most challenging element of this for advisers is not about knowing what question to ask and when. It is curbing the desire to talk and allowing yourself to be deeply curious instead.
P.S. Do you want to become a master of asking great questions? If so, check out the exciting new resource, ‘Financial Planning Power Questions’.