Personal Finance

Clients: Connect My Money To What Matters In My Life

Financial advisors tell me that their clients are increasingly looking to their advisors to answer a range of life questions, in addition to the expected financial ones. These life conversations can be far more revealing for the advisor and, if managed correctly, should uncover life goals that need to be a strategic part of comprehensive, sustainable and successful financial planning.

When advisors are faced with clients whose approach to finances is emotional and chaotic, the easy “out” might be a workaround, essentially ignoring outlier behaviors and proceeding, business as usual. Or, a more engaged advisor might even refer clients out, to deal with their financial psychological challenges separately.

But with the right tools, financial advisors can understand their client’s financial personality and respond to their client’s life questions. In fact, they’ll be helping their clients help themselves. This insight empowers advisors to guide their clients to achieve their quality life (and financial) goals.

Understanding a client’s financial personality

Still, financial life coaching should not be considered a new approach. Many advisors have been doing it all along. What may be missing are the tools to support advisors as they hold meaningful conversations based on individual and unique client needs.

Using a scientifically validated discovery process, financial life coaches ask more powerful questions of their clients. They can more effectively uncover important life plans that impact wealth creation.

When financial personalities are known, advisors can begin to uncover the often-repressed life goals that need to be defined and built into the planning cycle.

Financial life coaches are trending

Financial planning based on this life coach/financial advisor approach inevitably produces more effective outcomes for both advisor and client. Not only are financial plans rooted in life planning, they become motivators to help clients focus on why they work, why they build wealth and why they approach money and financial decisions the way they do.

Life-financial coaching is a powerful process that further refines and focuses our work. Tools that reveal financial personality must have a firm scientific foundation. If so, what they uncover can then be used by advisor and client to build accurate playbooks.

I’m seeing that financial planners who position themselves as this kind of “coach” are the next big trend in the wealth management industry. This has the added benefit of helping rebuild trust in an industry that has taken some heavy hits in recent years.

This life-financial coach approach also has the benefit of appealing to a younger demographic who are familiar with the whole area of personal training. Too, technology-native generations (that is, those who do not know a world without near-constant tech connectivity), might just as soon navigate wealth creation with a roboadvisor or other alternative, unless they see you are leveraging fintech to know, understand and benefit them.

But this niche – this approach – is not just youth-focused. It benefits advisors to lift their game to better understand the importance of getting to know all clients at a deeper level.

We all need a coach

Moving into the area of wealth coaching presents an opportunity for advisors to reposition their business. Armed with the tools to reveal and measure financial personality, advisers uncover the drivers behind spending, saving, and all areas of money management. From this point, they can then deliver advice as both coach and financial planner.

And even experts need a coach. “Everyone needs a coach. It doesn't matter whether you're a basketball player, a tennis player, a gymnast or a bridge player,” was how Bill Gates chose to open his TED Talk.

This is where financial advising and life coaching meet: When financial advisors know their clients’ financial personality, these insights ultimately empower both advisor and client. Money underpins so much of life and those advisors willing to provide extra help to their clients are more likely to win a greater share of the market.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Hugh Massie

As a Behavioral Finance Insights Pioneer and Identity Trailblazer, Hugh Massie empowers advisers, business leaders, families and individuals to unlock their identity in order to accelerate dramatic change and discover how unknown behaviors – which intensify through un-managed differences, money attitudes, pressure and emotions – derail performance.

Read Hugh's Bio