It’s Saturday, September 20th and I’m laying over in Seattle until Monday after returning from speaking at NAIFA Inland Empire in Ontario, California.
I’m using this quite time to prepare for a NAIFA ClientCast Interview on October 7th.
NAIFA ClientCast is a FREE monthly 24/7 podcast about Insurance and Estate Planning Strategies that is forwarded by NAIFA members to their clients and prospects each month.
While my experience in my field of expertise goes back to 1989, my coaching, speaking and writing has been for the benefit of Financial Advisors to help them to meet and exceed their goals and my coaching, speaking and writing has not been directed towards the public at large until now. Not quite; I presented The Inspirational Point at the Powell River TEDx Talk in April of 2013 and you can view it here.
Since April of 2013, I’ve presented a modified version of The Inspirational Tipping to Financial Advisors throughout Canada and the USA.
The opening of The Inspirational Tipping opens with First Understand;
… When there is judgement, there can be no understanding
… When there is defence, there can be no understanding
… When there is doubt, there can be no understanding
… When there is fear, there can be no understanding
In other words, there is nothing wrong, only an absence of understanding.
I offer that success is 10% about How and What do, both success and failure are 90% about understanding WHY, failure is self inflicted and that most of the time, it requires outside help to create sustainable change.
In the case of the Financial Advisor, most Financial Advisors know that it order to create sustainable success in their business, the following business systems need to be in place and in many cases they are not. WHY?;
- Vision and Business Plan
- Information Management
- Time Management
- Delegation
- Hiring
- Team Building
- Marketing and Sales
- Client Relationship Management
- Customer Service
Before we get in WHY, let’s look at the Top 17 Mistakes Consumers Make When Working With A Financial Advisor.
To get the gist of where I am coming from let’s look at the definition of Consumer; noun – a person or thing that consumes things.
- Consumers are always needing and they don’t know what they need or want.
- Consumers can’t determine the difference between a need and a want. Things they need now vs things they want later. Consumers don’t have anything they want long term, everything is a need NOW.
- Consumers wait too long to work with a Financial Advisor.
- Consumers are addicted to procrastination and stuff.
- Consumers assume they can make up for lost time while they continue to medicate their needing with stuff; cars, clothes, drink, entertainment, food, hobbies, housing, technology and travel … stuff they can’t afford.
- Consumers are unwilling to set long term goals based in what they truly want.
- Consumers pay too much attention to financial media hype, the sole purpose of which is to sell them advertising to inflate their needs.
- Consumers don’t commit to a plan to contribute to a 401k / RSP, reduce mortgage debt and minimize high interest credit card debt because they are addicted to needing and debting.
- Even if Consumers work with an Financial Advisor, they sabotage themselves and don’t commit to working with a single Financial Advisor.
- Consumers tell half the truth and work with two or as many as three Financial Advisors at the same time. None of the Financial Advisors have the complete picture. Consumers set themselves up to not minimize their risk and to not maximize their investments.
- Consumers play one Financial Advisor off of another Financial Advisor. Consumers get counter advise setting some Financial Advisors up to over compete and oversell the benefits of their products and services that they have to offer just to get the Consumers business.
- Consumers grade their Financial Advisor based on investment returns when Financial Advisors don’t control the market.
- Consumers need 12% short term returns to satisfy short term needs vs wanting 7% long term returns.
- Consumers tend to get sold products that appear to meet their short term needs by financial product sales people vs working with an accredited and licensed Financial Advisor to achieve their long term wants.
- Consumers refuse to put a Will in place. A Financial Plan is incomplete without a Will. Then again, Consumers may not be interested in Willing their credit card, line of credit and mortgage debt to their family.
- Consumers don’t understand what they need, want or value and this gets in the way of the Consumer understanding what the Financial Advisor is doing for them.
- Consumers don’t understand that a Financial Advisor can’t do it for them, a Financial Advisor does it with them.
So WHY are these challenges happening?
Before I answer WHY, let’s look at the difference between a Consumer and a Client from the perspective of a Financial Advisor.
The financial world has changed from a time, to a results, to an experienced based economy.
In a time-based economy you can never demonstrate enough value to justify your fee. In a results-based economy you can never do enough to justify your commission.
Things have changed from a results-based economy to an experience-based economy.
Clients want the experience; they want an advisor who shows up on time, who they can trust, who treats them like family, who finishes what they start and who fulfills their commitment.
Financial Advisors have got to make a difference in the way people think and feel about themselves. That’s the real reason Clients buy from you and stay committed.
It’s not about an extra quarter percent. It’s about how you make Clients feel.
Secure, safe, confident and committed Clients will stay as Clients.
Consumers move on, they care less about how they feel and more about getting the cheapest price. Consumers can get it for a quarter percent less anywhere and they are just Consumers.
From the very first visit to your website, through telephone, front desk, consultation, delivery and after sales, the Client experience can create a brand ambassador or a brand disaster. A happy Client becomes an unpaid ambassador of your sales force.
So WHY do Consumers make mistakes if and when they work with a Financial Advisor?
Consumers don’t know the difference between an unmet need and a want, a true value. Said again, Consumers don’t know the difference between an unmet need and a value.
This fuels and fools Consumers into not knowing the difference between Inspiration and Motivation.
Inspiration is based on values like counsel, discover and nurture. These are the core of all positive beliefs and feelings. Inspiration is sustainable because it is driven from within.
Motivation is based on unmet needs like recognition, safety and worthiness. These are the core of all negative beliefs and emotions. Motivation is not sustainable because it is driven from the outside trying to medicate the unmet need with cars, clothes, drink, entertainment, food, hobbies, housing, technology and travel … stuff.
What are some of the Mistakes Consumers Make When Working With A Financial Advisor?
- Starting too late
- Working with more than one Financial Advisor
- Consumers tell half the truth
Starting too late – The unmet need of safety generates the negative beliefs of “I don’t have enough time” and “I don’t have enough money” which fuel the negative emotions of anxiety and fear … hence, the Consumer is addicted to survival.
Working with more than one Financial Advisor – The unmet need of control generates the negative beliefs of “I am out of control” and “no one can do it as good as me” which contributes to the negative emotion of fear. The Law Of Attraction is absolute and with the unmet need of control fueling the negative beliefs and negative emotions, the Consumer unwittingly will not work with a Financial Advisor and if they do, no one Financial Advisor will ever be able to do the job as good as them and they interfere and work with too many Financial Advisors at once. The unmet need become the Consumer’s jailor.
Consumers tell half the truth – The unmet need of worthiness generates negative beliefs of “I don’t have enough” and “I am not enough” which contribute to the negative emotions of fear. The Consumer recreates this false truth by not working with one Financial Advisor and telling the whole truth so that the Financial Advisor has the complete picture. Consumers set themselves up to not minimize their risk and to not maximize their investments – hence they fail because they believe they are not worthy.
“Values are like turtles, they only come out when it is safe”. Unmet needs will dominate ones values, vision, finances, goals and ability to grow until the unmet need is met from within.”
For more insight on the differences between unmet needs and values, watch The Inspirational Tipping Point TEDx Talk.
Thank you to my friend Bob Gignac, author of Rich Is A State Of Mind, for his insights about The Top 17 Mistakes Consumers Make When Working With A Financial Advisor;
International Values and Behavioral Analyst, Business Coach, Speaker and Author
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