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Building Client Trust in a Bear Market

Clients come to you for help and they want to know that you always have their back, and they won’t feel that way if they don’t trust you. Here are some ways to build client trust that will help keep your clients calm during a bear market:

Make a Connection

Of course, you need to keep your professional relationship professional, but you can’t connect with a current or potential client if you start talking numbers and processes right away. While that may feel like client communication 101, it’s a fundamental step to remember if you’ve forgotten.

Know Your Clients’ Values and Goals

You can’t serve a client in a way that makes them feel you have their back if you don’t know their values or goals. “Some financial advisers have unfortunately learned the hard way, they are not entirely sure what the client wants or values,” Rob Crowe writes in a Summit Brokerage blog post titled “Client Communication Tips: How to Better Communicate with Financial Advisor Clients.”

Knowing these things is vital, especially during market turbulence. When your client starts freaking out and wanting to do things that are not in line with their goals, remind them of all the goals you’ve helped them achieve already and keep them focused on the goals that they are working toward.

Be Transparent About Fees and Process

A study by Financial Engines found that 93 percent of those surveyed think financial planners should be fiduciaries. Demonstrate to clients that you have their best interests at heart by being transparent about your fees and discussing any potential conflicts of interest. Transparency breeds trust. Also, be clear about the planning process and explain what you are doing in terms they can understand.

Communicate Consistently and Respond Promptly

If you don’t do this, when you do finally send clients correspondence, it will likely cause them anxiety or stress. If you reach out with monthly or quarterly newsletters or reports, they’ll come to expect communications. Also, if they have a question, answer it promptly in their preferred method of communication, not yours. Concern yourself with their happiness. Be genuine about this. Inquire about the things that are important to them. Show them that you care, and it will build trust, says Angie Herbers in her ThinkAdvisor article, “The Four Steps It Takes to Build Client Trust.”

Ana TL Headshot_Cropped

Ana Trujillo Limón is senior editor of the Journal of Financial Planning and the editor of the FPA Practice Management Blog. Email her at alimon@onefpa.org, or connect with her on LinkedIn


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3 Steps to More Emotionally Intelligent Teams

Self-awareness is not easy. In fact, to paraphrase Ben Franklin, it is among the top things that are hard in life, along with diamonds and steel.

Some advisers have learned this the hard way.

“They question my strategies and don’t trust that I know what I’m doing,” said one such adviser with exasperation. This adviser I was coaching had fired a client that month and had lost two more over the course of the year, over what he described as “irreconcilable differences” regarding his advisory process. “Do they have their CFA designation? Did they spend years following the markets and learning this craft? If they could do it themselves, why waste time with me?” he posed.

Reflection is the First Step

In my experience with Knowledge Labs™, and as a coach to thousands of advisers over the better part of two decades, I’ve learned to recognize when to pause and re-evaluate a situation. I couldn’t break through in this moment; my client was too triggered by what he was feeling to be able to reflect. When we are triggered—often due to past experiences—we don’t act in accordance with our values. Fortunately, I was able to get him out of his own head by asking, “What do you think they are not getting that is causing them to question your approach to investing?”

The adviser loves his clients and wants more of them, but he loses patience when they seem to question his responses. What he had misidentified as his clients’ lack of confidence in his advisory skills actually had more to do with emotional intelligence (EQ). I’ve long valued EQ and use it constantly in my work with Janus Henderson’s Professional Development Team on research and curriculum development. This adviser’s clients needed more clarity and involvement, which can sometimes be elusive but are reachable through self-management of emotions that result in an alignment of behavior and values.

Reflection is the first step in the journey to greater EQ. When you feel like you’re up against a wall in a conversation, ask two questions:

  • What are they really asking for?
  • Why is it eliciting such a dramatic reaction from me?

Once we recognize our triggers through reflection, we can start to reframe. Reframing seeks to change the way we perceive events to avoid triggering. Other EQ boosters include the Myers-Briggs Type Indicator (MBTI), journaling, meditation and Kolbe (a provider of assessments identifying the natural way that people take action).

Emotional Intelligence in Team Settings

Our frustrated adviser was in need of a refresher on the benefits of EQ, but he’s not alone. Emotional intelligence is an all-too-common blind spot in many people’s self-awareness that affects individual performance. In this case, it was beginning to seep into his team’s performance as well.

Knowledge Labs™ recently partnered with The Investments & Wealth Institute and Cerulli Associates on a study that identified qualities shared by elite advisory teams, and self-awareness is a critical component to knowing what you need to build an extraordinary team.

Three steps to emotionally intelligent teams:

  • Reconsider “majority rules.” Even if there’s only one dissenter, hear them out and make sure all possibilities have been properly considered.
  • Put your team members in each other’s shoes. Cross-training won’t make everyone an expert in everything, but if teammates understand the complexity and time requirements of everyone else’s task load, they’re more likely to give each other a break.
  • Speaking of breaks, encourage your team to take them and do the same yourself. Go for a walk. Get away from email, even if only for a few minutes. Take regular vacations. Burnout is both unhelpful and contagious.

Putting the Pieces Together

The adviser, who took some very helpful walks around the leafy neighborhood surrounding his office, was already seeing changes. He learned to label his own behavior and understand what he could control about himself, rather than the opinions of his clients. His team’s revamped attitude was showing as he spoke about better relationships with clients and colleagues at a follow-up meeting six months later. Without making any drastic changes to his core principles, he was able to shift his interactions to the positive.

What we can learn from his positive experience is that, more often than not, hard things are worth the effort.

Learn more about elite teams in Knowledge Labs™’ Attributes of a Top Performing Advisory Team.

Editor’s note: A version of this blog post appeared on the Janus Henderson Investors blog. See it here

Michael Futterman

Michael Futterman is an assistant vice president, Knowledge Labs™ Professional Development at Janus Henderson Investors. In this role, Futterman works with the Professional Development team on research and curriculum development for the professional development programs. He is a frequent speaker and coach to adviser and client audiences. Futterman leverages his experience with Outward Bound, management consulting firms and the financial services industry to bring innovative, engaging and thought-provoking content to his clients.


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3 Choices in Business that Lead to Success or Failure

Success or failure is a choice—whether conscious or unconscious—a choice nonetheless. The thing about success and failure in your business is that you are constantly stepping toward one or the other.

Abraham Maslow, renowned psychologist, echoed this belief when he said, You will either step forward into growth or you will step back into safety.”

Watching which direction you step is to choose each step wisely. Choosing to step forward toward pursuing your goals could bring with it the fear of the unknown. Choosing to step backward toward complacency could bring with it the comfort of familiarity. But you must ask yourself this, is it better to boldly succeed or is it better to safely fail?

Understanding Your Daily Direction

Most advisers start each day without any thought of what direction their business is going. Granted, some may have what I refer to as proactive activities scheduled—such as prospecting appointments; but many advisers spend their day on reactive activities—such as putting out client fires and other interruptions to their schedule.

At the end of the day, many may feel like it was productive or unproductive based on their perception of the amount of proactive or reactive tasks they accomplished.

One example of this is an adviser who would be feeling accomplished because they opened a new account, thus, growing their business. On the other side would be an adviser who felt they were productive returning/taking calls, thus keeping clients satisfied.

The real question is which adviser moved toward accomplishing their goals? Let’s explore the answer below by looking at three choices and how each pertains to business.

Choice No. 1: Stepping Backwards

Stepping backwards in your business is a slippery slope that seems to be paved with good intentions. While putting out fires is important, your client base will never consistently grow unless you incorporate daily prospecting. An adviser who only works with their current client base is, in fact, taking a step backwards by doing so because over time the client base decreases due to client attrition. The solution is to schedule time to prospect daily so you can fill up the pipeline and grow your business.

Choice No. 2: Staying Stationary

Staying stationary in your business is a misnomer because a business is either growing or shrinking. However, many advisers who are on a production plateau feel comfortable because their business is not trending downward—that is until they experience a bad market and quickly realize that their assets under management are spiraling south. It is oftentimes at this crossroad where any unhappy clients leave as well.

Again, the solution here is to prospect daily. The reason why growing a client base is more important than just the returns on investment growth is because the more qualified clients you have, the less dependency you have on any one client.

Choice No. 3: Stepping Forward

Stepping forward with your business takes dedication and discipline to integrate the activities that are needed to grow and to maintain and service your existing client base. It’s done by ensuring structure to the day and having a method to prioritize and/or delegate interruptions. In also requires that you work smarter by getting more effective at everything you do and not just by working harder doing more of what you have already been doing. Look for areas of your business that you believe need improvement and find ways to make those areas stronger.

Finding Your Path

Before we explored these three choices, I asked you the question regarding which adviser took a step forward toward accomplishing their goals? The answer is neither, because each adviser focused on only one aspect of the business. To find your path to success you need to create a balance between all facets of running a business by evaluating and implementing best practices.

If you are ready to take your business to the next level, schedule a complimentary 30-minute coaching session with me by emailing Melissa Denham, Advisor Solutions’ director of client servicing.

Dan Finley
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.