Adviser Stories: The more you know about a client the better

29 January 2019 | Practice Management


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Advisor's typogragphy visual

What matters to clients isn't return and taxation, it's reaching their goals.

Sometimes clients don't actually know what their goals are. They tend to have a clearer idea of what they don't want. A client might come out with a nugget or a hint. As an adviser, you can pick up on that and follow through. Some people don't realise how many options they have. I see our role as helping them to see what's possible and allowing them to dream.

When I work with a client, I want to really get under their skin and find out what matters to them. If you understand what makes a client tick and how they make decisions, you have a much better chance of helping them reach their goals.

Cash-flow modelling makes a real difference. When you use it with clients, you can see them having a lightbulb moment. It helps you bring things to life and that helps clients make and understand decisions. You can use it as a tool to discuss their fears and raise what-if scenarios. You really move away from being transactional when you use it.

Patterns of expenditure change over a lifetime. There's often a rollercoaster in early retirement, where people spend a lot more at first. Then they start spending less as they find they don't need to sustain the same level of spending as they get older.

Illustration of Nicola Watts next to a rollercoaster

In a two-hour annual meeting, I only spend about a fifth of that time discussing products. The rest is spent talking about what a client wants to achieve and determining how we can help them work towards that goal.

The more you know about a client the better. When I sit down with a client, I make sure I ask for as much detail as possible. It's so easy to miss something out – a huge expense that a client hasn't considered properly, like a wedding for example. We do this not only when we talk about their goals but also when we analyse their risk tolerance. We want to know how anxious clients are about their money, how likely they are to want to jump in and change strategy if their investment goes down in the short term.

Because we get to know our clients so well, we find they trust us more. For example, when we woke up to the shock Brexit referendum result, we expected a deluge of calls and emails. However, we got nothing. We've worked with many of our clients for 25 years. They know us so well that they trust that if there's something they need to know, we'll get in touch with them. If we say there's no need to worry, they believe us.

We're now getting to the point where we've worked with some clients for so long that we end up working with their children too. When we meet our clients' children for the first time they're often surprised by how much we know about them! But of course we do – we've been working with their parents for so long.

Knowing a client really well means you can you can suggest things to them that they might not have thought possible, like spending more or even retiring early. When a client trusts you enough to take your advice, you can have a really positive influence on their life.

Nicola Watts, Director, Jane Smith Financial Planning.

Vanguard's Adviser Stories are a series exploring adviser-client relationships.


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Important Information

The opinions expressed are those of the individual author and may not be representative of Vanguard Asset Management, Limited.

Issued by Vanguard Asset Management, Limited which is authorised and regulated in the UK by the Financial Conduct Authority.

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