How to deepen your client relationships
by Amyr Rocha Lima, CFP®
Retirement planning is a core function of the financial planning profession. But our job is not just to help our clients accumulate resources. We also need to help them as their coach and cheerleader as another life stage begins.
We work with clients to articulate and quantify their goals, then craft a strategy to achieve those goals. But planners and their clients shouldn’t view retirement as the culmination of a financial plan.
Doing so ignores the opportunity we have to add ongoing value to our clients’ lives – and to our businesses – by planning for what happens next.
A client who has achieved financial independence – that is, they have enough resources to support themselves for the remainder of their expected lifetime – has reached a significant milestone. It is the end of one stage of life, and the beginning of another.
The client’s core values may stay the same, but their goals and priorities continue to evolve and extend indefinitely into the future. That’s why the need for retirement planning doesn’t end when the client is mathematically able to retire.
The meaning of money
As life-focused financial planners, our job is not just to help our clients accumulate resources – we must guide them on how to use those resources meaningfully and live their best lives both before and during retirement.
From the client’s perspective, a retirement plan requires more than money to be successful.
To live happy and meaningful lives, people draw upon other resources, such as valued relationships, personal growth, and above all, a sense of purpose.
Yet money remains interwoven with all these other factors, and a person’s financial habits – many of them ingrained from a much younger age – can inhibit their ability to enjoy the fruits of financial freedom that they worked so hard to obtain.
A complete financial plan incorporates money and meaning alike, and the client’s true outcome is measured by their ability to use all available resources to achieve their best life.
Life-focused financial planning starts with discovering what the client really wants from life before addressing any monetary factors.
In processes like the EVOKE® methodology developed by the Kinder Institute of Life Planning, the planner asks a series of probing questions that gradually uncover the client’s most deeply held dreams, fears, and motivations.
Only after the planner and client fully understand these life goals – and the obstacles that may lie in the way of achieving them – do they start discussing financial strategies.
Once the plan is in place, the planner continues coaching and encouraging the client until all of the steps are implemented. They continue to meet at a minimum of once per year to repeat the conversation, ensuring that the plan remains aligned with the client’s true goals.
Post-retirement financial planning is a continuation of the same process, adjusted for the fact that the client is now free to pursue whatever they wish to find meaning.
It requires the same level of mutual trust, empathy, and engagement as during the client’s working years.
Adding value to clients lives
For retirees who haven’t yet replaced the structure and sense of purpose that working gave them, the life planning approach gives them an essential key to solving the retirement puzzle.
As average lifespans increase into the nineties, the typical retirement time horizon will likewise expand and so will the number of opportunities we have to bring value to our clients’ lives.
Coach & cheerleader
By exploring the client’s unique goals and values to render a mental image of financial independence, the lifefocused planner creates a powerful incentive for the client to stick with their financial plan.
Planners develop a bond of trust by listening with empathy to clients’ hopes and fears, and act as both coach and cheerleader to change the client’s limiting behaviours and celebrate the milestones that lead to the plan’s fulfilment.
As financial planners we are obligated to act in our clients’ best interests, and the life planning method represents the pinnacle of this fiduciary approach. It also aligns with our own business model.
We can no longer rely solely on quantitative solutions like investment management and cashflow modelling to grow our practices; the competition in that space has grown so fierce in recent years that opportunities to win new clients and satisfy existing ones are scarce.
The value that we provide is in getting clients to see the big picture – the life that financial independence makes possible.
When that image sinks in and clients fully realise what they can achieve, that value becomes priceless.
Food for thought
Personal finance is more personal than it is finance. A person’s financial habits can inhibit their ability to enjoy the fruits of financial freedom in ‘retirement’ that they worked so hard to obtain. Many of these habits are ingrained from a much younger age and a key role of a financial planner is to help ‘un-limit’ these beliefs. As people’s lifespans increase, so do the opportunities for financial planners to add value to clients’ lives, by helping them work out their future possibilities.
However, they’ve since witnessed the decline of the manufacturing and coal mining industries. They’ve lived through four significant recessions. With each economic downturn came increases in interest rates, inflation and – perhaps most crucially – a marked distrust of the financial services industry.
Here’s a simple exercise for you to use with your clients:
Ask them to imagine that they’ll wake up tomorrow and everything about their life is exactly the same – except for two things. They have no possessions but the clothes on their back and they have a bag of money, the contents of which are identical to their net worth today.
How would they feel?
What would they do?
What would they change?
The role of a financial planner is not just to help our clients accumulate financial resources – we must guide them on how to use those resources meaningfully and live their best lives both before and throughout retirement.
Amyr Rocha Lima, CFP® is a partner at Holland Hahn & Wills LLP, a financial planning practice based in Kingston upon Thames. He specialises in working with successful professionals age 50+ helping them reduce taxes, invest smarter and retire on their terms.