Recognizing instinctual, subconscious, and engrained habits or responses is a challenging, but important, first step on the path to modifying one’s behavior for more desired outcomes. A person cannot consciously choose to change a behavior unless they become aware of 1) what they are doing, and 2) how and/or why it was formed in the […]
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I Mean, Really, What is Risk Tolerance Anyway?
Since the dawn of time (well, that might be a tad exaggerative), financial advisors have been trying to devise ways to mathematically calculate and predict the very subjective and complex matter of their clients’ risk tolerance. Even the supposedly “objective” side of risk tolerance, also known as “risk capacity” (how much loss can a client […]
Listen to Understand: The True Purpose of Client Discovery
In our work with financial planners, we frequently point out that a successful practice is built on getting to know and understand their clients. We also emphasize that this objective can only be met through exploring each client’s unique frame of reference. This is so important in client relationship development because each person’s “frames” shape […]
Guiding Clients Through Life’s Challenges
As financial advisors, we often experience the privilege of being among the first to be called when a spouse passes, when a child enters rehab, or a parent moves into memory care. In these difficult life transitions, how are you showing up? Do you jump to the quantitative solution, or do you hold space for […]
What is True Client-Centered Discovery?
At Money Quotient, we believe that the most successful client relationships are built on asking the right questions. That’s because good communication is so much more about listening than it is about talking. And, to this end, the best financial planners continually seek to perfect their inquiry skills. Several years ago, I read an interview […]
How Financial Planners Can Support Behavior Change
In his article “Why Good Financial Behavior Isn’t Achievable Until You Believe That It Is,” Derek Tharp addresses the frustration that financial planners experience when trying to help clients adopt healthier financial habits. He explains the root cause of self-sabotaging money beliefs and behaviors in this way: As almost all financial advisors have […]
Help Your Clients Make the Most of Their Regrets
In his latest book, The Power of Regret: How Looking Backward Moves Us Forward, Dan Pink flips regret on its head. Rather than looking to the emotion as a catalyst for guilt or shame, the book focuses on the best of what regret can do for perspective: provide the opportunity to make smarter decisions. Advisors […]
Assessing the Value of “Functional Quality” in Designing Financial Planning Engagements
In our Money Quotient training programs and research projects, we frequently refer to the groundbreaking work of professors Neeru Sharma and Paul G. Patterson at the University of New South Wales. In the late 1990s, they conducted a study that identified communication effectiveness as the single most powerful determinant of a client’s perception of service […]
Elicit, Provide, Elicit: The Art of Skillful Advice-Giving
Advice is inherent to financial planning. Heck, it’s in your title: advisor. But how you give advice can make or break the client/advisor relationship and directly impact the follow-through. The Righting Reflex The righting reflex is our natural reaction to hearing someone else’s problem. This is the powerful urge to provide our own opinions, solutions, […]
Nurturing Financial Resilience
The COVID-19 pandemic has demonstrated to us once again that economic uncertainties are ubiquitous and often hard to predict. We need to stay vigilant and be prepared for the rainy days. -Standard Center for Longevity To launch the “Financial Resilience in America” project, researchers at the Stanford Center on Longevity teamed up […]