When it comes to making investment decisions, new behavior is arising between advisers and their clients. A recent article from Investment News discusses the changing trend in the relationship between clients and advisers. A shift from the adviser being the single source of direction is occurring, as more clients bring their investment management ideas to their adviser. Help to embrace this shift by finding more balance in your relationship with your clients. Viewing your clients in this new light will lead to open, informative and trusting partnerships.
Thinking of your clients as partners
As investment advice becomes less of a one-way street, advisers must be more collaborative
Investment News
February 26, 2012
Libby Dubick
This article includes 4 tips “to help manage a more collaborative relationship with a client”:
- “Ask questions. As a consultant, I never suggest to a client that I know all the answers to a problem. What I promise is that I know the questions to ask and that when we are through addressing them, the answers will be apparent to us both. An adviser truly engaged in consultative selling has a similar role, which requires attentive listening and asking probing questions that go beyond the mundane.”
- “Be a resource. Whatever investment idea a client brings an adviser, there are likely to be many more solutions, and possibly better ones, to meet the client’s objectives. It is the adviser’s responsibility to offer alternatives, and to compare and contrast possible choices. This process helps the client arrive at an answer most likely to meet his or her needs.
- “Provide perspective. Most investors can draw only on their own experiences, or those of family and friends. Advisers, on the other hand, probably have helped hundreds of clients build and manage portfolios over the years. That knowledge and experience can be invaluable to people trying to finance their first home, balance college costs with savings or determine when to retire.”
- “Offer objectivity. Thanks to behavioral-finance research, most advisers now realize just how biased and seemingly irrational the decision-making process can be. For example, most investors are willing to sell a stock and take profits when a position appreciates but are reluctant to sell a stock that has declined in value, even if holding on could mean further losses. Being the voice of reason in these situations can keep an investment plan on track.”
