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Having Conversations That Aren’t About Money

January 10, 2014

In “Teachable Moment,” FA-IQ asks advisors to describe a client interaction that taught them a lesson of lasting value. This week we interviewed Jude Boudreaux of Upperline Financial Planning in New Orleans. He learned that paying attention to a client’s non-financial needs can be crucial to building and maintaining lasting relationships.

When a new client comes in to our practice, we like to have an open-ended discussion about money, values and goals. Sometimes this goes in predictable directions, as when people say they want to save for an early retirement. But sometimes the conversations go in directions we never could have predicted.

One particular client came in with her husband for an initial planning conversation. I asked her what she would do if she found out she had five to 10 years to live. This is a question we often ask our new clients; it’s one of George Kinder’s famous three questions that life planners often use. I like it because it helps give you a sense of what’s important in someone’s life. But the woman had an immediate and emotional response. She said that she would write regular letters to her young children to tell them that she loved them. Now, this is something that clearly didn’t have anything to do with financial planning. It was a personal issue that I could’ve easily left alone. But I was paying attention to this woman’s body language and tone of voice, and those both indicated how very strongly she felt about this topic. My intuition told me that this was something worth following up on.

I typically give my clients homework at the end of our meetings. Because I’m a financial planner, the homework is generally related to money. But in this case, I decided to try to help this client follow through on this idea of writing to her children. I told her to take 10 minutes to list the sorts of things she would want to tell her children in those letters. She was surprised at the suggestion but agreed to try it out.

The next time I saw her, she told me that she’d written the list, and more. She’d created e-mail accounts for her young children. When there was something she wanted to remember in particular, she wrote them an e-mail about it. It was her way of capturing those moments.

This process seemed to have nothing to do with money, but I think there was a correlation. This process will influence her financial decisions as she moves through life. Writing to her children will help her stay in touch with what’s important. In turn, her awareness will probably spill over into her family’s spending decisions. It may even help them focus on what’s truly important — such as family experiences and their new home — and not to spend money on things that aren’t important.

I’m a fee-only planner, which means I can take the time to have these conversations. If you’re dealing with investments and that’s how you get paid, then that’s what you end up talking about. Our compensation model provides us with a bit more space to have these conversations. Even if they don’t have short-term financial ramifications, they are a way to set the stage for a long-term relationship with a client. They can also be a subtle way to encourage clients to prioritize spending.

Put simply, taking the time to learn about our clients’ values up front helps us do a better job of delivering financial advice later on.