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The Six-Step Approach to Soft-Sell Planning

We’ve all walked into a car dealership and been hassled to buy that car we don’t need or walked into a department store and been told we must buy certain items without our needs ever being considered.

The days of the “hard-core close” type of salesman has for the most part, had his day. This is especially true in the financial services industry as increased regulation and scrutiny have been placed upon those of us giving advice on individuals’ retirement accounts. Although many may see this type of increased responsibility as an impediment to a successful practice, a slight shift in perception can change that viewpoint.

With today’s ever-increasing presence of robo-advisors, the plethora of financial information available on the internet, and the ease of use of different electronic platforms to purchase financial products, the question of “Why work with an advisor at all?” has entered into many investors’ minds.

Because of this, a more consumer-driven approach continues to evolve. This approach highlights the true benefits of holistic planning. This shift in the sales process for financial service professionals has been transitioning away from the product-driven approach to a needs-based approach, which is well warranted. If we don’t understand the individuality of each client and put their financial needs and desires at the forefront of the planning process, someone else will. 

Taking on change is never an easy process, but it’s necessary for continued growth. Advisors who understand this, continuously develop their skills so their practice can flourish. Although there are many different approaches you can use, there is a fundamental process that should be at the core of every advisor’s business model for a successful practice. By using this process, growth can be captured through multiple channels which include both renewal and referrals. Below, we will break down the steps involved in the acquisition process using a thorough needs-based approach to ensure your clients’ ultimate satisfaction.


Step 1: Establishing the Relationship

This step is perhaps one of the most important steps in the process. It is here when you first sit down with a prospective client, let them know about your capabilities and philosophy, identify the services you will provide, determine the responsibilities, and disclose important information including compensation, conflicts of interest and material facts. The benefit of this openness to the client is that it builds trust and rapport in the relationship, along with identifying any roadblocks you may incur along the way.

Another major advantage of initiating the meeting with this step is that the advisor can disqualify clients. One thing most advisors struggle with is the idea that they must serve any client who comes along. When establishing relationships with prospects, it’s important that you do so for the right reasons.

Most financial planning objectives, such as retirement or estate planning, are meant to be long term. If you’re unable to picture a relationship with a client lasting for an extended duration, it is better to find out sooner than later. This will reduce and eliminate potential headaches and problems down the road, and help you align yourself with clients who have a sense of reciprocity.


Step 2: Data Gathering

After the relationship has been established, the advisor now shifts the meeting towards a fact finding and data gathering session. During this step, it’s important to be as thorough and detail oriented as possible by using multiple communication methods.

Interviewing and active listening techniques are crucial in obtaining a deep understanding of the client’s goals and objectives, which are not always black and white. The use of both quantitative and qualitative client information is necessary to make sure we have a complete picture of a client’s financial situation, so we can properly address strengths and weaknesses.


Step 3: Analyze and Develop

After the initial client meetings have concluded, it is time to sift through the information you have gathered so you can formulate a plan for the client. Obviously, the amount of work you do in Step 2 can make all the difference.

By having a prioritized list of the client’s goals, current balance sheets, cash flow statements and other pertinent information, you can successfully evaluate and determine how likely the client is to accomplish the goals they have in their current situation. From there, you can make the potential recommendations to strengthen the chance of financial success. It is important to document any assumptions used such as inflation, life expectancy and assumed interest rates so you can easily communicate them to the client. 


Step 4: Communicate Recommendations

The next step of the process focuses around helping clients understand their current position, along with steps that can be taken to strengthen the likelihood of achieving their financial objectives. Here we will disclose the assumptions that were used along with the interdependence of each recommendation. Clients must understand the impact of not implementing specific parts in the plan.

For example, if you recommend a client purchase long-term care insurance to protect their assets in case of a chronic illness, their retirement funds could be easily exhausted from the inability to perform two of the six activities of daily living if they fail to implement the coverage.

Being objective is important as it continues to influence an open and honest relationship between client and advisor. This confidence that is built can be a tremendous benefit as it will continue to establish you as a trusted advisor — as opposed to a “product pusher” — in the eyes of your clients.

One of the most important aspects of this step is to verify the client understands what is being presented. Creating a financial plan can expend a lot of time and resources, and it will all be for nothing if the message is lost in translation.


Step 5: Implementation

You’ve successfully shown the value of the services you provide to your client. You’ve demonstrated competence and ability to help that client achieve financial independence. It is now time to take the action necessary to execute the appropriate recommendations.

Determining which responsibilities fall on which party is a great start. If, for instance, a life insurance policy is to be used for estate liquidity needs, explaining the steps the client will need to undertake is imperative. By educating the client on the different intricacies of the life insurance application, explaining the underwriting process and informing them of specific insurance processes will help facilitate the execution of the recommendations.

It is also crucial for an advisor to let the client know whether there are limitations of the advisor’s expertise. If an outside party is needed, having the appropriate contact information and potentially sitting in on the meeting can make the difference of whether or not the plan will be put into effect.


Step 6: Monitor Plan

As mentioned previously, these planning relationships, once established, are meant to be long term. There are multiple benefits that come from systematic reviews. The recurring contact you make with clients encourages the relationship to grow.

Life situations also can be very dynamic. Scheduling periodic reviews with the client throughout the duration of the plan can ensure the greatest possibility of success. Having the client understand that communication responsibility falls on them as well is of critical importance.  As certain life-changing events occur, they can create the need for revisions to the plan.

As the financial services industry continues to evolve, it’s important we make the changes necessary to go along with it. There are plenty of tools available to help you improve the process by which you conduct business.

The days of product pushing and cookie cutter mentality are in the rear view, so we can now move forward to a more holistic and complete approach. This process brings tremendous benefits to your practice.

Understanding that each prospect and client is different and unique is a perfect place to start. Using a systematic approach will help to maximize your time and resources, which will in turn promote increased productivity to your practice. The trust and rapport that is made will help promote long-lasting, reciprocal and prosperous relationships that will last a lifetime.



Joe Schweiger, CFP, is a field support professional with LifePro Financial Services, San Diego. Joe may be contacted at [email protected] .

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