Families Squabble Over the Beach House

DNA Behavior Insghts

Over the years, I have done a lot of work in helping families build succession plans and manage their assets. Sometimes, this involves dividing their assets.

What I have often seen is that the family differences in terms of behaviors, communication and attitudes are magnified because of the way each person deals with the beach house. Put another way, bad behavior or perceived bad behavior around the beach house spills over to arguments over the family investments and business interests. How important is your family beach house?

Interestingly, other wealth advisors are seeing the same thing.? See what Stacy Allred from Merrill Lynch has to say – click here.

Visit the Financial DNA website to learn more about our solutions for navigating the different behavioral styles and emotions of family members.

The Importance of People Centered Leadership in the Financial Industry

Our leaders are too involved in understanding/unraveling complex regulatory issues to spend time leading…

In many parts of the world financial regulators are placing more and more constraints on the industry. From improving record keeping in terms of recording advisor/client conversations to alerting the industry about the need to understand client behavior over and above tolerance to risk; and many other change requirements in between. Add to this a far savvier client base and leadership may well find itself with no time to support advisors or even navigate the business through these complicated seasons.

But – the financial landscape is shifting – it’s all about communication and understanding advisor and client behavior. Today’s leaders are crafting a new and innovative direction for the financial industry.

Jackson was looking for something different in the financial industry; something edgier, something to raise his passion for the business

At this current interview he was asked to complete a behavioral discovery process (profile) customized for financial services. When completed the interview panel openly shared the outcomes in their behavioral reports with Jackson and the interview process began.Leadership in the Financial Industry

No reference was made to his credentials, his previous experiences, his challenges. All of that information could be found in his resume. The questions the panelists asked were customized to his behavioral style and pointed to his hopes of his future, how he would expect the leadership to serve him in terms of fulfilling his expectations for his career path.

They clearly knew from his behavioral report that he was strategic, driven and would undoubtedly have plans for his career path.

Jackson found himself fully engaged in what was now a conversation focused on what they as a business could do for him rather than what he could do for them.

As the interview process drew to a close the panel asked Jackson to comment on the way they had conducted the discussion. He responded that it was very different and he found himself responding to their questions by opening up areas of his life, his future plans, his preferred style of communication and so much more than he had ever intended.

The panel concluded by telling Jackson that this approach mirrored the way the company provided financial advice to their clients.? This approach was all about understanding the clients hopes, dreams, plans for their future in terms of their finances and then lining up advice and support that worked in partnership with them to achieve these goals.?? This approach set a platform to ask revealing questions to uncover and deliver real insight into the advisor/client relationship.

The leadership of the company did not believe in containing creativity and initiative with their advisors; they believed in harnessing behaviors and talents and matching them with clients so that relationships could be formed that not only lasted but also provided well targeted advice that delivered outcomes, built trust and formed strong client/advisor partnerships.? They also saw this approach as one that would deliver the advisors vision for future and thus ensure they retain high quality staff.

Not surprisingly Jackson chose to work for this company.? The leadership had crafted a meaningful vision; one he knew lined up with his own personal passions.? Six months later and Jackson has fully embraced this style of working with clients. His clients see completing a profile as a useful “icebreaker” and feedback has demonstrated their support for the process and their belief that the advice they are being given genuinely focuses on their personal strategies for their future and how best to create wealth to deliver these plans.

Learn more about adopting a people centered leadership approach – click here.

What Do Clients Want From Their Advisor?

Often we think that clients want higher investment returns from their advisor, and therefore that defines the role of the advisor. However, research shows that clients want a relationship. This has actually been the case for a long time but the research is becoming clearly stronger all over the world in the need for advisors to develop stronger interpersonal skills and emotional intelligence.

What Clients Want from AdvisorsRecent Trusted Advisor Research by Professional Planner magazine in Australia demonstrates that an advisors interpersonal skills and emotional intelligence are most important by 82% of the survey participants who were clients of Advisors of the Year.

Refer to the full article at:

There is no doubt developing your interpersonal skills grows the bottom line. In advisory business relationships are the key to revenue sustainability.

Many advisors are naturally results orientated in behavioral style and therefore naturally lower on relationships. But, the interpersonal skills can be learned with sustained effort, focus and investment. The starting point is behavioral awareness.

So, the question becomes why isnt there more sustained investment in developing the interpersonal skills and EQ of advisors? It seems there is still a strong over weighting towards technical training. When we see this change, trust in the industry will grow.

Our firm has recently been working with Advisors Ahead to deliver this type of training to financial planning students and young advisors. This is an important starting point but needs to go much further.

To learn more about how you can grow to become a behaviorally smart advisor, please visit the Financial DNA website.

The Life Experience I want to Create

But my Financial Advisor doesnt ask the right questions!

Does your Financial Advisor asking the right questions?Sadly, generally speaking, not all financial advisors are fully committed to exploring your hopes and dreams and then matching your financial plans to deliver those expected life experiences. Its not their fault, they are often young and inexperienced in the ways of life or have not embraced their own life journey yet, and they are obligated to sell you products determined by the company they are employed by.

As a client what can you do to change the way your financial advisor works with you in order to meet your unique needs? What can you do as a client to move the relationship to a level that puts you in the driving seat and educates/helps your advisor to spend more time investing into you, your financial behavior, your plans and your dreams?

At the outset its important to understand that your financial advisor may be completely resistant to the thought of understanding your behavioral approach to your finances (other than your ability to manage risk). But equally important is to know that the financial industry is changing ? more and more attention is being paid to how to increase business and retain clients through changing the behavior of the industries advisors.

So here are some keys to changing the client/advisor relationship:

  1. Research what the financial advisory company is saying about itself. Look at websites, marketing material; listen to executives recorded messages: look for the types of phrases listed below and ask the question ? what will you do to deliver this statement in terms of the financial advice you propose to give to me?
    – tailored client advisory service
    -the best possible expert advice for your situation
    -exceed their clients’ expectations (do they know/understand your expectations?)
    -advisers will help identify exactly what you require to meet your needs and achieve your goals (how?)Are you achieving your financial goals for living a Quality Life?
  2. Understand your own risk attitudes. Be clear about what you really think risk means to you. This self-awareness will help you to navigate the risk conversations more effectively and will ultimately deliver a greater level of success in the relationship.
  3. Encourage the advisor to ask leading questions. Prompt them. For example:
    -Would you like to know about a significant financial experience in my life? (this might refer to a financial loss, a financial gain or seeing something similar happen to a family member)
    -Would you like to know about three noteworthy plans I have that have not as yet come to fruition.
    -Can I tell you about proposals my children have for paying for their education?

There is, of course, no guarantee that your advisor will adjust their performance to embrace a more behaviorally based advisory relationship with you, but at this juncture the next question that you should be asking is this: – do I really want to continue to give my business to a financial advisory company who cares more about product sales than the plans I have that I trust will prosper me and give me and my family not only a good life but help us to deliver the hopes and dreams we have?

To learn more about developing financial behavior awareness, please visit the Financial DNA website.

Try Financial DNA free for 30 days!

4 “Must Have” Apps for Financial Advisors

Advisors wear many hats. Advisors need to be great networkers, great money managers, great bosses, and a great wealth mentor. Salesforce can help with some of these activities inherently just by keeping you organized, but the real ticket is inside the Salesforce Appexchange where independent software providers have developed apps to make your life easier.

I have selected 4 cutting edge apps to help with your marketing, client service, workflow management, compliance, document creation processes, and keeping a watchful eye on your clients portfolio.

Communication DNA | Customize your marketing and client service activities

Communication DNA is a customer engagement app used by advisors to discover the emotional decision-making patterns of clients to allow for the real time customization of marketing and client service activities. You as an advisor, use this information to understand what drives your clients decision making, and help establish the environment that your clients need in order to financially perform.

Communication DNA delivers your clients communication keys, preferences and contact details directly to your Salesforce account without you lifting a finger.

More about this app

How Communication DNA works:

Process Composer | Workflow Management for your Advisory Team

Process composer is a smart engine to build and automate simple or complex repeatable processes. Create a firm-wide consistent client experience, enable visibility by seeing the status of client requests, & drive Salesforce adoption by imbedding routine processes in CRM.

CREATE CONSISTENCY: build sales, service, HR, and compliance processes so they happen the same way every time.

CREATE VISIBILITY: empower employees with the ability to graphically see the status of client requests.

DRIVE ADOPTION: imbed your routine processes inside Salesforce CRM to create dependency and drive usage.

More about this app

How Process Composer works:

Conga Composer | Easily generate your documents for Compliance
Easily generate custom proposals, account plans, contracts, presentations and emails with content from multiple objects and related lists. Works with Word, Excel, PowerPoint, PDF forms and HTML email in single, batch and scheduled operations.

More about this app

How Conga Composer Works:

Sycamore | Client and Compliance Manager
A simple, easy to use application designed specifically for a financial advisor. Automated workflows, Client communication and seamless data integration help you manage your customers more efficiently and effectively.
A complete client balance sheet is tracked. Assets include bank accounts, financial accounts, holdings and insurance policies. On the liability side, both short term debt like car loans and credit cards are tracked as well as long term debt such as mortgages and home equity loans.

Plus, Sycamore provides checks & approval processes to ensure you stay compliant.

More about this app

How this app works:

The Cooperative Compliant Client

This post is part of our series on Financial Behavioral Insights from our Financial Performance in the New Behavioral Economy White Paper. The financial behavior insights will help you gain greater self-awareness for recognizing some of your own behavioral tendencies and also those of investors.

The Cooperative Compliant

Behavioral Insight 3, Take charge investors, investor behaviorDon Spring is a 64 year old recently retired Chief Operating Officer who has now moved on to helping with fund raising programs in his local community. Don has been to stockbrokers in the past but never had a full service financial planning relationship. However, he now recognizes the importance of having an adviser help him through making key decisions with the substantial wealth he accumulated through his working career and also an inheritance from the passing of his mother. Don has three middle aged children and 7 grand-children with a range of needs. Don feels he has to help them financially without risking his own life in retirement.

Don is a Community Builder with a dominant trait of being a Cooperative Compliant. This means he is a person who naturally seeks to fit in with others and deal with what is immediately in front of him. He will naturally seek to work with others and get involved in group activities. In the community Don will be seen as generous.

When it comes to dealing with investments, a Community Builder with Cooperative traits will focus on each individual investment and may get lost in sorting out when to hang on to winners and sell losers. However, will follow a plan that is mapped out for them providing there are clear instructions on the investment policies and how they will be administered. This will generally help them focus on the overall result and not get stuck on looking at whether each particular investment is a winner or loser.

Behavioral Insight
Naturally practical and diplomatic people will be Community Builders who are Cooperative Compliants. Without advice they will tend to suffer from the disposition effect of selling winners and hang on to losers because of their naturally hesitant nature.

Communication key: Encourage their input to decision making and provide specific directions.

A struggle that a Community Builder will have is being hesitant in making key decisions. This will lead them to at times procrastinating and then? taking what is the easy step in the short term rather than what may be best for the longer term. This will usually result in suffering from the Disposition Effect of keeping the winners and not selling losers.

An advisor who is a Community Builder with Cooperative Compliant traits will be naturally good at giving the client direction but needs to slow it down and listen to what their client has to say. This type of advisor needs to be very careful that their dominant attitudes do not overly influence the portfolio.

Learning Point:
The Community Builder with a Cooperative Compliant dominant trait will seek to delegate responsibility for their overall planning to an advisor. The advisor should aim to guide them by seeking their views and then giving them specific instruction which are clearly explained. Ask the client: How confident are you in making financial life and decisions? How would you like the financial planning process to be managed?

To read about additional client behavioral styles, download the full Financial Performance in the New Behavioral Economy White Paper.

What are your thoughts?