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Chapter 3
A Fundamental Tool in the
Process:
Client Communication
The Process of Financial Planning:
Developing a Financial Plan
Lytton, Grable & Klock
2006
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Building Blocks:
Financial Planning Pyramid
Monitoring
and
Implementation
Plan Development
Financial Planning Process
Decision Making
Communication
Ethics / Laws / Regulations / Practice
Standards
Financial Planner:
Technician or Counselor?
A planner is a blend of counselor and technical
expert who works with a client to solve problems or
work toward goals.
Both must recognize that the client’s attitudes,
feelings or emotions – which must be explored –
may influence client action or inaction!
Change may be necessary to achieve change!
Financial Planner:
Technician or Counselor?

Are financial planners counselors?
• Based on Geis’ definition (p. 84)
 NO!
• Few financial advisors have academic training in
•
personality assessment, psychotherapy, or behavioral
change theory.
Although – traits associated with successful counselors
are easily adaptable to financial planning -- see Figure 3.1
Client Communication is the Key
As technician/counselor, planners should
• Be educator and coach
• Have the personality and skills common to other
•
•
•
professional “helpers”
Be open to the client’s needs
Blend empathy, compassion and warmth with
professional/technical expertise
Use these qualities to help clients prepare for the
planned and unplanned
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Perfecting the Craft of
Effective Client Communication

Takes

But a thorough grounding in basic
communication skills to initiate and foster
long-term planner-client relationships is
fundamental to financial planning
• Practice
• Experience
• Training
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Client Communication

Communication
• The exchange of information among two or more
•
•
•
parties
Verbal message or content represents less than
10% of the “real” message
Nonverbal and paralanguage cues provide the
context
Paralanguage is the tone, rate, and volume of
speech
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Client Communication

(cont’d)
If less than 10% of communication is truly
conveyed by the verbal message!
• THEN…over-reliance on specific words used to relay
information can be VERY misleading!
• Content is important…but the manner the words are
delivered is more important!
• Learn to read the verbal, nonverbal, and
paralanguage cues
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Client Communication

(cont’d)
Body language
• Nonverbal cue to emotions and feelings
• Facial expressions, eye contact,
gestures, body positioning, or
movements of individuals as well as the
use of space between the parties
• Affected by gender, ethnic or cultural
differences
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Client Communication

(cont’d)
Learn to read gender, ethnic or cultural
differences correctly
• Nonverbal cues and eye contact
• Tone and volume of speech
• Rate of speech and delivery
• “Personal space,” proximity, touching
In the U.S. more eye contact is associated with
sincerity, self-confidence, friendliness and maturity;
less eye contact suggests a lack of confidence,
defensive, indifference, coldness, or immaturity.
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Client Communication

(cont’d)
Congruence
• Consistency between how something is said and
•
•
what is said
Pay attention to words and tone, paralanguage
and body language
Planners must assess the congruence or
consistency of their own as well as their client’s
communication.
Words ≠ “message”
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Client Communication

(cont’d)
Attending (attentiveness)
• Combination of verbal and nonverbal cues that
validate the speaker – a critical message – to say
“the speaker and topic are important”
• Maintain comfortable eye contact, comfortable
distance between speakers, relaxed but
comfortable posture with gestures used to
“punctuate” the message
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Client Communication
(cont’d)
When attending, do NOT:




ask questions that change the focus or context of the
speaker’s message
change the direction/topic of the conversation
interrupt the speaker
add new meaning or explanation to the speaker’s
message
Support the speaker with simple verbal confirmations
or restatement of the speaker’s word or phrase
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Messages to Clients

Messages beyond the explicit content of
the words are constantly being sent to
clients.

Effective planner-client interview is based
on three elements
(1) Privacy
(2) Comfort
(3) Control
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Messages to Clients:
(1) Privacy

The client
• Often unwilling to share confidential financial and
personal information in informal settings

The planner: Take time to design an office
environment that sends message of
• competence
• orderliness
• diligence
• professionalism
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Messages to Clients:
(2) Comfort

The client

The planner
• needs to feel comfortable
• needs to cultivate feeling of trust
• design office and interview sessions to maximize
comfort
What message does the office environment/appearance,
diplomas/certificates, refreshments, and staff send to a
client?
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Messages to Clients:
(3) Control

The client
• Does not want to feel manipulated, but expects
the planner to manage the information flow,
interview tempo, and overall client experience.

The planner
• Needs to create an atmosphere that makes the
•
planner-client interaction efficient and effective.
Two approaches: Authoritative relationship or an
open/consultative relationship
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Beyond Adjusting
the Physical Environment

Developing a personal communication
strategy is equally important
•

Why? Without one, you take a leap of faith your
personal and professional message will be
understood by the client.
Review the total communication effort
• Appearance
• Demeanor
• Seating position
• Eye contact
• Communication style
• Presentation of information
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Assessing Clients’ Information
Processing & Communication Styles

Clients and planners
• view the world differently
• typically assume their view is correct and shared
•
by others
who try to change the other’s view will have
difficulty!
Individuals do what is best for them using past experience
and knowledge as their guide – even if that experience
and knowledge does NOT apply to every situation!
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Experiential Maps & Heuristics

Experiential map
• Varies for every individual
• Explains and defines the world
•

around an individual
Is based, partially, on heuristics
Heuristic
• Is a cognitive shortcut used to
simplify difficult decisions
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Assessing Clients’ Information
Processing & Communication Styles

HOW do planners know clients’ preferred
methods?
• Verbal, nonverbal, and paralanguage cues

HOW do planners use the cues?
• Receive the signals
• Interpret the signals
• Tailor communication to the client
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Learning and Communication
Modes

Preferences vary by individual, although all
three are used

Three primary modes
•
•
•
Visual
Auditory
Kinesthetic
Hint: Consider information processing styles relative to
primary sensory inputs: eyes, ears, and physical
and emotional experiences.
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Three Primary Modes
1. Visual
2. Auditory
3. Kinesthetic
Rely on what they
Rely on reactions or
hear
actions (emotional or
physical)
Prefer: watching
Prefer: talking to
Prefer: involvement
others complete a
task
planner vs. reading
the plan
in learning process
Examples: figures,
Examples:
Examples: mental
PowerPoint, reading
& taking notes,
organized &
sequenced
presentations
lectures &
interactive
discussions,
question & answer
sessions
imagery, interaction
with computer
applications
Rely on their eyes
Information/Communication Style
Comparisons
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Information/Communication Style
Comparisons (cont’d)

Remember: Everyone is an individual with a

Listen for your client’s clues – Exhibit 3.2

The goal is to have your message heard &
understood. If the approach doesn’t work:
• a preferred style
• a more effective style, or
• no preference in style
• try another approach
• try combining approaches
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Information/Communication Style
Comparisons (cont’d)

Why is style so important?
• Richer understanding for planner and client
• “Revision” or broadening of maps/heuristics or
•
acceptance of the consequences
Expansion of knowledge and options –
empowerment!
Use direct and indirect exchanges to communicate in all 3
modes and get your message heard!
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A Basic Tool Box for
Planner-Client Communication

Why?
• Communication skills initiate, build, foster,
maintain and enrich relationships
• Communication skills make the relationship
more interesting, less predictable, and more
open to action and change
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A Basic Tool Box for
Planner-Client Communication

What are the basic tools?
• Listening
• Clarification
• Use of Questions
• Use of Silence
• Putting it all together
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Listening
“I’m
listening…”
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Listening: Ratio #1
• Ratio of 4:1
• Two ears, two eyes,
one mouth
• Use this ratio to guide
communication
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Listening: Ratio #2
• Hearing ≠ listening
• Speaking & listening ranges =
125 – 400 words p/minute
• Thinking ranges = 1,000 to
3,000 words p/minute
• Boredom drowns spoken
words
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Active Listening
• Ears, face, body, mind, and heart
• Total engagement – spoken and
emotional messages
• Learned skill
• discipline
• self-control
• Know when to shift to and from
empathetic listening
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Listening:
The Client & The Planner
Client

Seeks help when
emotion(s) are
present
• anger
• anxiety
• fear
• disappointment
• enthusiasm
Planner

Does not always
need to agree

Does need to
communicate
understanding,
interest,
acceptance, and
empathy
Communication Cues of
Emotional Distress
Clue
Indicator of Emotional Stress
 Higher than Normal Pitch
Tone of Voice
 Raised
Volume of Voice
Rate of Speech
Facial Expression
Body Gestures









Very Low
Faster than Normal
Slower than Normal
Frown
Pierced Lips
Tears
Arms Folded Across Chest
Use of Index Finger to Point at Advisor
Covering of Face with Hands
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Clarification
ARE YOU really
listening?
ARE YOU really
taking an
active role?
Four strategies:
1. Restatement
2. Paraphrase
3. Summarize
4. Mirroring
Clarification: Four Strategies
1. Restatement
•
•
Restate main
thought in
condensed or more
direct method – use
the speaker’s words
WHY?
•
Benefits the client
and the planner
2. Paraphrase
•
•
Use your own words
to restate the basic
message in concise
simple statement
WHY?
•
Used to clarify mixed
or double messages
from client
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Clarification: Four Strategies
(cont’d)
3. Summarize
•
•
Focuses on main ideas & integrates into
cohesive reflection of a discussion
WHY?
•
•
•
•
Planner can summarize client’s comments
or client can summarize major issues
Useful in beginning or end of meetings
Indicates movement or progress
Useful to identify tasks/responsibilities
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Clarification: Four Strategies
(cont’d)
4. Mirroring
•
•
Reflecting, or matching, the verbal and
nonverbal communication of the client
WHY?
•
•
•
Enhances communication
Communicates that the planner is listening!
Use care not to be too overt
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Clarification: Four Strategies
(cont’d)
Use the strategies = accomplish goals
• Develop personal but professional relationship
• Foster mutual trust
• Support continued exploration
• Expands knowledge of maps, heuristics, emotions
• Establish feedback
• Encourage continuation of discussions
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Using Questions

How do you ask questions?

Excessive use hurts relationships

Questions to avoid
• CAREFULLY
• No apparent answer
• Insulting
• Only solicit answers that clients think
you want to hear
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Using Questions:
Two Types of Probing Questions

Similarities

Differences
• Helpful when seeking information
• Start with interrogatives (e.g., who and what)
• Level one probe
• Obtains factual information from client
• Level two probe
• Delves deeper into client’s knowledge
and attitudes
• Use caution with “Why” questions
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Silence

Silence can be golden, but it
makes some uncomfortable

The benefits?
• Helps clients to continue processing &
•
discussing difficult topics
Encourages clients to provide more details and
to resolve issues
Allows the planner to notice nonverbal cues
•
• Allows the planner time to think
Foster silence with non-verbal messages
Putting the Tools Together

According to Rattiner, for effective
communication:
•
•
•
Have a positive attitude and look for the positive – client
strengths not weaknesses!
Establish rapport – be genuine, caring and empathetic
Tune into needs and goals – listen for spoken and
unspoken messages
But it’s always a good idea to
just “shut up” and listen
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Ongoing Planner-Client
Communication

Two Other Important Communication Skills to
Master
• Handling client resistance and objections
• Practice active listening, clarification, questioning
and silence
• Learn to “close the deal”
• Marketing
• Prospecting
• Servicing
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Resistance & Objections:
“Closing the Deal” + Trust

Practice good communication and follow-up
• Listen and use paraphrasing and summarizing to
•
•
•
•
isolate each reservations – 1 at a time!
Listen for maps and emotions – not just facts –
and counter with empathy, not more facts!
Explore and balance objections with the
importance of the goal
Look for compromise to address the goal
Be patient and keep the lines of communication
open
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Marketing

Prospecting
• Increased visibility, name recognition and client
awareness of services

Servicing (relationship marketing)
• Periodic communication to nurture/expand
existing relationships
Both should solicit action by the recipient!
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Tools for Marketing

Drip marketing

Direct marketing

Indirect marketing
• Continuous flow used for prospecting and servicing
• “Personal touch” meant just for you
• Formal or generalist perspective for widespread
appeal
See Exhibit 3.4 for Marketing Strategies
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Summary

Technician vs. counselor vs. “closer” –
communication enhances the planner’s roles

Mastering fundamental communication skills is
critical to trust-based, enhanced client
relationships

Attention to information processing and
communication style effects all aspects of client
interaction, including marketing
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