The latest thinking about financial planning

I had the pleasure recently of attending the excellent Back2Y conference in Birmingham. This conference is predominately for financial planners, but also for anyone interested in hearing about best practice among financial planners in the UK and further afield.

 

What struck me first of all was the number of Irish advisers at the event. It was really heartening to see 40 – 50 advisers investing in their futures, taking a day or two out of busy schedules to travel to the UK to listen and learn. I think it was certainly time well spent by all.

 

So what messages hit home with me? Well I thought that 2 speakers in particular stole the show. The first was Nick Lincoln, a financial planner from South East of England. Nick had a very engaging and humorous delivery, but all backed up with a very simple message. The other great speaker was Mitch Anthony, an American who runs a training and communication consulting firm specialising in the financial services and insurance industries. Mitch is a real pro, with some really strong messages that were very thought provoking.

 

The Three Killer B’s

This was the simple message delivered by Nick. He spoke of how important it is for advisers to never lose sight of three important standards in their business,

  1. Be Picky: You’ve only so much room in your client base to deliver your services as you want to. So pick your clients carefully. Trust your intuition and don’t be afraid to say “no” to potential clients, that you are not the right fit for them. This resonated a lot with me, as I quite often hear advisers moaning about how certain clients “wreck their head!” Nick’s view is that these clients are a drag on your business and you are better off without them.
  2. Be Honest: Tell clients the full unvarnished truth about their money, don’t build false expectations. They won’t thank you for this, ever. Tell people what they need to hear, not what they want to hear.
  3. Be Consistent: Nick’s view is that clients all have the same big question – “will we be ok?” You need to answer this question for clients, and then answer it again, year after year using a consistent process.

 

A very simple message, very well delivered!

 

The Return on Life Revolution

This was the first part of Mitch Anthony’s presentation in which he spoke of revolution in the financial planning world today, as opposed to the relatively gentle evolution over the last decade or so. He spoke of the consequences of misplaced value, where an adviser is judged solely on the financial performance achieved for clients. This is a recipe for disaster – you are judged on factors over which you’ve no control, you’re under scrutiny every month / quarter / year, you are constantly compared to others and unfortunately will be wrong in your predictions very often!

 

Instead Mitch contends that advisers should position their proposition around intangible factors such as “helping people make wise financial decisions”. The value in this instance is felt and seen, but is not measurable in the way that tangible financial performance is. Mitch spoke of 6 core values of Return on Life,

  1. Organisation: helping clients bring order to their finances
  2. Accountability: Helping clients follow through on commitments
  3. Objectivity: Helping clients not to make emotion-based decisions
  4. Proactivity: Helping clients prepare for big changes in their lives
  5. Education: Helping clients understand what they need to know to succeed
  6. Partnership: Working in collaboration with clients towards achievement of the best life possible for the client.

 

All of this is a lot more valuable that achieving a particular financial result!

 

The big questions for advisers

Mitch Anthony then spoke later about the 3 big questions for advisers, for each of you to really look inside yourself and to answer truthfully.

 

The first question is to understand whether you’re in the money business and happen to work with people, or in the people business and happen to work with money? I think everyone will immediately say the latter, but does your discovery process really reflect this? Unfortunately with some advisers there is still a race to find out how much money a person has, and as a result the person (client) gets forgotten. Financial planning today is all about people and their life objectives; it’s not about money (even though of course this is part of the solution).

 

The second question relates to this focus on people rather than money. How have you changed your conversations to reflect this changed world? Because only talking about money and financial solutions just won’t cut it with clients who yearn for a deeper insight into achieving their life goals.

 

The final question related to the forces that cause money to move to you. Mitch’s view is that these come down to 3 forces,

  • An intellectual force: People are curious; they want to know more when you have positioned what you do correctly. Often their experience with a previous adviser leaves them seeking a better one going forwards.
  • A force of life: As people think about transitions in their life and their responsibilities for other people, they seek support – your support.
  • An emotional force: This is when you show deep empathy, that you are really listening. And then ask carefully crafted questions about their principles and values in relation to life and money. From this will come goals. And from there will come the potential to build highly engaged relationships with clients.

 

It was a day very well spent!

How to write a great Financial Broker video script

Lots of Financial Brokers recognise the power of a really good video that you can use on your website and through other communication channels. We’re seeing a big upsurge in enquiries about them.

While of course the look, style and general production quality of the video are really important, the script is probably the most critical element. So how do you produce a good script?

We spoke to Stephen Doyle of Vision Media who has produced videos for quite a number of Financial Brokers, product providers and other financial services businesses and we asked him for his tips.

 

Here’s what Stephen had to say!

 

A video has the power to tell a convincing story about your business in 60-seconds. A well-written, engaging script is the foundation for a successful explainer video. Without the right foundation, the rest of the creation process is in vain.

So what can you do to make sure your video is a killer and not merely a nap inducer? It starts with proper preparation – knowing your audience, your message and your call-to-action is essential. Beyond that, here are 7 tips to help you write a better script.

 

1. Keep the script short

The length of your script will depend on your audience. A captive audience in an auditorium endures about five to eight minutes before beginning to drift. An Internet surfer popping by your website tends to check out after two to four minutes depending on how compelling your material is and whether or not they needs your product.

 

2. Put your message in the first 30 seconds

Reduce the message of your entire video to one sentence and get that sentence somewhere in the first 30 seconds of the script. This tells the audience what to pay attention to in the video.

 

3. Speak directly to the audience

The easiest way to speak to an audience is to use personal pronouns like “you” and “your”. Another way to engage your audience is to show them things they care deeply about. While you may be proud of your second quarter earnings, what they care about is whether you can help them improve their own bottom line. Don’t waste time telling your audience what they already know. Focus instead on what they need to know about you that will bring them to trust you and to take the action you want them to take. Don’t talk down to your audience or over their heads. Make friends with them and they will be far more likely to give you a chance to sell them something.

 

4. Find the right tone

Have a mental picture of your customer in mind when selecting the tone of your video. Write a one-sentence summary describing why you are making the video and what you want the viewer to do at the end of it. This will suggest a tone for your finished video. You may decide you want a talking head in an office, a brief classroom style presentation, a light-hearted romp, a bold outdoorsy documentary or a colourful animated review.

If you have story-driven characters, imagine real people as mental placeholders. It’s much easier to write realistic dialogue if you are writing for someone whose habits and mannerisms you know well. The tone you choose for your video will then drive your choice of setting, narrator or cast, tempo, pace and type of dialogue for the script.

 

5. Tell a story

Most explainer video scripts present a problem (Mary knows her money is not working hard for her), introduce a solution (Mary gets a diversified portfolio in place that results in her money working for her), explain how it works (Mary got independent advice from her Financial Broker who developed a risk-based investment portfolio for her), and drive viewers to action (contact your local Financial Broker and get your money working for you).

Dry facts, statistics and definitions are okay in the classroom, but unless your video is for students imprisoned in a classroom, avoid lifeless content whenever possible. Instead, use the power of the screen to show your audience actual people your company has helped, or benefits your services have bestowed on your customers. Testimonials create stories about themselves to help them define who they are. The better you tell stories about yourself, the more likely your viewers are going to understand what your company is offering and what it can do for them.

 

6. Use humour wisely

Humour is a great tool for story telling so long as the humour supports your message. Make sure your attempts at humour fit seamlessly within the story you’re trying to tell, and keep in mind that misplaced or poorly timed humour can be distracting and may actually put off potential customers.

 

7. Pace yourself

Keep dialogue to between 140 and 150 words a minute. And while you might be able to speak 200 or more words per minute on your own, keep in mind that the voiceover needs time to breathe, allowing viewers to absorb what you’re saying (this is especially true if the content is particularly dense or technical in nature). Machine gun fire dialogue quickly overwhelms viewers, causing abandonment, and decreased comprehension.

 

When producing an explainer video, don’t skimp on the script. Take the time necessary to do it right. Get feedback from friends and co-workers, and make sure it’s engaging and easy to understand.

 

So there you have it! If you would like help in pulling a great video script together, please give us a call.

Image courtesy of Lidia Aparicio / Ashary

Why I’m such a fan of Voyant

I’m a huge fan of Voyant’s software and usually go out of my way when meeting financial advisers to encourage them to start using it, if they are not already doing so.

First of all to be clear – this is not because of any commercial arrangement that I have with Voyant to be out there promoting their software to advisers, because no such arrangement is in place.

I’ve 2 reasons for being such a fan. The first is because I’ve seen the impact that the use of Voyant can have on an adviser’s business. The second is because of the impact Voyant has had on my own financial planning.

 

The impact of Voyant on advisers’ businesses

One of the busiest areas for me over the last few years has been helping advisers transform their businesses from a financial dependency on the products that they sell to a financial model where their income is based on the advice given to clients. This results in a more stable and lasting income stream that can be easily justified to clients, the regulator and any other interested party!

However when basing your business around advice, it’s of course not enough to simply advise clients on the best product to buy. Clients want financial guidance, they want to avoid making mistakes and want to put their limited financial resources to best use. They want to be able to plan for the future with confidence. Because at the end of the day, clients don’t think in terms of how much money they have or need. They think in terms of what they are going to be able to do in the future – this might be to retire early, to put their kids (or grandchildren) through college, maybe to buy a place in the sun in the years to come. Clients have these pictures in their head. The value that you can bring is to make the pictures the reality by guiding clients on how to achieve these goals financially.

And this is where Voyant comes in! Voyant enables you to build scenarios for your clients that show the impact of different financial inputs (your income, pension contributions, your investment portfolio, regular savings, protection products) and of outputs (lifestyle costs, expenditure, financial commitments, unexpected events). Now you can have real conversations with your clients about what their money can do for them, rather than how much they might have. This is real advice that clients will pay for year after year, creating that durability in your income stream and value in your business.

Of course financial products will often be needed to make these lifestyle goals the reality. But now the conversation is all about lifestyle rather than focusing on the products. For those of you that use Voyant regularly, you know there are also many other uses for it – looking at ARF bomb-out risk, calculating the correct amount of life cover etc.

Voyant to my mind is a critical element in transforming you from being a product picker to becoming a true financial planner or adviser.

 

The impact Voyant had on my own finances

I worked in life companies for 27 years, am a QFA and when I left in 2011, I was pretty confident that I knew my financial situation. I didn’t have a financial adviser.

Roll forwards about 18 months when I started working with my current financial adviser because I had a straightforward product need – I needed to put income protection in place. So he did that, but then he got me (and my wife) talking… About how we saw the future shaping up, our hopes and dreams, our objectives around our son’s education, holidays, targeted income in my business, big purchases, retirement, wealth transfer and the rest.

He plugged this information into Voyant. Now I already knew my financial situation at that stage and also had a good sense of how I was fixed financially when I reach retirement age. But I knew nothing about the intervening years. The value of Voyant for us was that it clearly demonstrated that based on our current financial picture, I was going to run out of cash at age 53 and effectively be underwater for 4 years then. This was a real shock to the system!

So the conversation changed completely. How were we going to close the gap? What did this mean in terms of reducing our outgoings? What “big spends” had to go on hold? What did it mean in terms of our investment and pension portfolio management?

And that has become the conversation now each year. Not how my products are doing (which of course is also important), but if our objectives will be achieved. Thankfully with the guidance of my adviser I’m now not going to be struggling at age 53, the gap has been closed. That to me is really valuable financial advice that is worth paying for.

 

It’s for these two reasons that I’m a big fan of Voyant.

Networking

6 Steps to better Networking

Networking is a really important business activity, but it’s one that fills a lot of people with dread… They think of standing around in crowded rooms with no one to talk to, or being pinned in the corner with somebody talking endlessly about some mind-numbingly boring topic. And so while most people recognise the importance of networking, very few people do enough of it. In fact, I find it’s the one activity that causes the most discomfort when it ends up on the marketing plan for a Financial Broker!

So what can you do to make it easier and more effective? After all, if it actually works and helps you generate new clients, you are much more likely to continue to do it.

Recognise that it isn’t easy

It isn’t easy… but it isn’t easy for anyone. So while you might think that it’s so easy for certain people, that tends to be because they’ve worked really hard at becoming good at networking.  However, while some people might appear to find it easier than others, everyone at least has a common purpose  – they are there to build connections. So approach it from the point of view that at least everyone has the same goal and are open to talking to you.

You must have a strategy

At the end of the day, you’ve got to be standing in the traffic if you want to get knocked down! But it’s not enough to wander blindly into a networking event without a clue of how you’re about to approach it. This starts before the event where you try and get a handle on who is likely to be there. Are there lists of attendees available in advance? Can you check out who members of the business group / conference attendees are? Once you’ve an idea of who will be there, you can start thinking about who your preferred “targets” are. And then you can start doing some quick research on them through their website and LinkedIn profile. And this research will hopefully come in very handy later…

Be a first mover

Don’t just head for your pals and spend your night in deep conversation with them! By all means, if they are in a group of people that you want to meet, take the opportunity to get introduced into the group. But be active and make the first move to start conversations. Others will thank you for this and it also gives you the opportunity to guide the conversation.

Be interested

And this is where your research comes in really useful! If you can show a level of interest in the people you meet – some knowledge of their business, some connections you have in common, it might even be that you know about some quirky interest of theirs, this will ease them into the conversation as you are opening the door for them to talk about themselves. And then be interested because your interest in them will come back in spades. They will naturally want to reciprocate and turn the conversation towards you, which of course is then your opening…

Hone your own pitch

When you get over the initial chit-chat and move on to talking about your reason for being at the event and what you have to offer, this simply must be interesting and must grab their attention. At the end of the day, they will be talking to many people that day so you must be in some way memorable. If you are pitching your wares, paint pictures of solutions, not saying why you’re such a great financial planner. Let people see how you will solve problems for them and enrich their lives in some way.

Follow up brilliantly!

Then when all the hard work is done, make sure you take the final step. Contact people after the event saying how it was great to meet them and thanking them for their time. Connect with them on LinkedIn and if you send out a company newsletter, suggest that they be added to the circulation list. Send them information if this makes sense. If there’s a favour you can do for them, maybe there’s someone else you can introduce them to – well then this is even better.

So yes, networking is not easy. But hopefully these few thoughts might make the task a little less daunting for you!

Will Clients Pay Annual Fees?

The whole area of fees sends a chill down the spine of lots of financial advisers. How much do you charge? Will clients pay? Will they pay every year? These are some of the questions I’m asked all the time.

Yes we’ve seen moves towards fees in other markets, with a lot of focus on the changes in the UK in particular. But that doesn’t mean that we’re moving to a fee only environment in Ireland. In any event, I think the question of commission v fee is the wrong question… To my mind, it’s all about what you’re being paid for, rather than how you are paid.

Maybe let’s start with some of the reasons that clients won’t pay annual fees, whether this is paid by an annual fee, a monthly retainer or as a trail commission.

 

They can’t afford them

There’s no doubt, there are many clients out there who just are not in the position to write you an additional cheque every year. Their income may be low, their outgoings may be high and these clients are seeking the minimum number of financial products to meet lender requirements and to provide basic levels of protection for their families. These clients are not going to pay fees.

 

They don’t see why they should

This is a more interesting group… These people can afford fees, have multiple financial advice and product needs but don’t see why they should pay for it each year. Whose fault is this? Well it’s theirs if they think that they can get your services for nothing. But maybe it’s your fault if they just don’t place enough value on what you do? You need to consider;

  • How much value are you providing beyond setting up products?
  • How robust and valuable is your planning and advice model?
  • How well do you communicate this to clients?
  • How well do you link this value proposition with your charging basis?

Get these right and you’ve a better chance of convincing this group to pay your fee each year.

 

They know another adviser who won’t charge a fee

There is always another adviser who will undercut you on price, indeed there are execution-only options out there for clients. However this is where the focus is solely on the product implementation. If you can demonstrate to the client that the fee is for the excellent and valuable advice that you give and that this will positively impact their outcomes, they are more likely to decide based on value gained rather than the price paid.

This group is a tricky one for advisers who hate to see a client go elsewhere. But if you’re not being paid a fair price for the value that you bring, it sometimes makes sense to walk away…

 

So what are the main activities that you need to undertake in order to give yourself the best chance of convincing your clients that the annual fee is worth paying?

 

Develop a compelling advice proposition that clients value

I know that there is a huge amount of talk at the moment about the need for a clear value proposition… But it really is a basic requirement if you hope to convince people to base their purchase decision on value rather than price.

Your value proposition needs to demonstrate to clients and potential clients, what you do, where you add value, why this is important to them and the positive impact that you will have on helping them achieve their financial objectives and better outcomes. Think this through from the client’s perspective – if they can’t connect with the value for them, you’re going to find it more difficult to justify your fee.

 

Make sure clients value your advice, not the product purchase

Move the conversation away from choosing the right product and then implementing it. At the end of the day, the clients don’t place much store on this. Advisers who are today receiving large portions of their income from fees focus more on helping the client really understand their life and financial objectives and then develop a plan for the clients to help them achieve these objectives. The products merely become vehicles to help them get there.

 

Deliver a great service and review process

If you’re going to look to charge your clients each year, you’re going to need an ongoing service that clients believe is second to none and worth the price paid. This will mean being available, adding value throughout the year and communicating regularly with clients.

Central to this is developing a really powerful review meeting. This is not just about communicating updated values (even though you do this too), but it is about really demonstrating to the client how they are progressing towards their financial objectives, and why continuing on this journey with you offers them the best opportunity of achieving their desired outcomes. So broaden this meeting out, bring in all of your undoubted experience and expertise and package it, so that your clients will seek out these value meetings with you, year after year! And it makes it easier for you to justify your fee.

 

What experiences have you of charging fees? What are the main hurdles that you encounter? Please feel free to leave your comments below

 

 

Photo credit:www.LendingMemo.com

Beat your competition all ends up!

You’ve been approached to pitch for the opportunity to advise a really great prospective client, maybe a wealthy individual with a lot of assets to manage or a pension scheme for a local company. However you also know that another adviser has been given the same opportunity….

So what do you do? One route obviously is to go in “as cheap as chips”, provide your advice for free and cut your transaction price to a level that just about makes it worth your while. Yes, you’ll win some clients this way, but not the ones you really want. Because every future conversation will result in a haggle over your price – no surprise really as you started it!

The alternative is to beat the socks off your competitors and demonstrate to the prospective client that you’re the only game in town for them to consider. Your challenge is to have demonstrated this by the end of your first meeting (your pitch) with them. Here are 5 ways you might achieve this;

 

Know the customer better than your competitor

Today there are so many ways to learn lots of really valuable information about your prospect before you meet them. This can give you a real edge, enabling you to anticipate questions or issues and to chat knowledgeably about areas of interest to them. At the very least, it shows your interest in them and their business.

Starting with their company website, you can learn about their business, getting a sense of their markets, their size and what is important to them. The prospect that you’re about to meet might feature in the “About Us” section so check this out too.

Check out their social media profiles. In particular LinkedIn may give you very rich information about the person. You can learn a lot about the person professionally, as well as their interests etc. You can also see if you have connections in common – this can be useful for the social chitchat at the start of the meeting.

 

Focus on their objectives and outcomes, not yours!

At the meeting, your initial goal needs to be to connect with the person and build trust before you can get into problem solving. To do this, you need to find out what their problem or challenge is and fully understand what their actual objectives and goals are. What will success look like for them? What will they consider a good result?

Your questioning style is very important here. The key is to use lots of Open questions; “what is your biggest challenge”, “why is that challenge so significant for you”, “how have you addressed this so far”, “when are you expecting a result” etc. Questions that cannot be answered with a simple yes or no!

This initial stage is all about getting the client talking. Once they are talking, their issues will become clear and then you can start to think about demonstrating how you can address the actual challenges that they are facing!

Hopefully at the same time, your competitor will dive in and start setting out their credentials and their approach to solving the client’s problem – quite probably not the right problem at all!

 

Then demonstrate your credentials

Once the client’s problem is clear to you, now is the time to set out why you are the answer to their prayers! This is a critical step – after this the client will decide who he is appointing to look after his affairs!

First of all, you can demonstrate your professional approach easily and effectively by walking your client through your planning and advice approach. This will give the client comfort that you are a professional with a robust approach, helping to build that all-important trust. I believe that this is best delivered using a short presentation on an iPad or similar device.

Case studies (anonymous) are another effective way to demonstrate your credentials. They allow you to showcase innovative approaches that you might have used in the past. They also demonstrate your experience in dealing with challenges similar to that posed by the prospective client.

Finally testimonials are a great endorsement of your capabilities. I always encourage financial advisers to seek permission to use the full name of the person giving the testimonial, as it gives it credibility – does “John T, Dublin 6” really exist?

Hopefully your competitor has just been having a chat with the prospect, saying how good they are but not really backing it up at all…

 

Practice – it’s not easy!

These last two areas of questioning the prospect effectively and then demonstrating your credentials are not easy. Road test them on your staff, friends and family. Get people to critically appraise your approach. Like all similar tasks, it’s going to take a few goes before you get it spot on. The last thing you want is to be trying it out for the first time on the best prospect you’ve had in a long time!

 

Start delivering value long before your pitch

This point should probably have been made at the start but I kept it to the end as not all advisers are in a position to deliver it at the moment. Providing ongoing content to clients is so important, deepening the relationship, demonstrating expertise and adding value. This might be in the form of an email newsletter or other such communication. If you do this, add your prospect to the list as soon as the first contact is made (get any necessary permission to do) and start sharing your content with them straightaway.

This will immediately set you apart from your competitor, giving the prospect a taste of what they can expect from you – a valuable, professional, robust approach to all that you do!

At this stage, hopefully you see the other guy’s white flag!