HS 300 Financial Planning: Process and Environment

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HS 300 Financial Planning Process and Environment

• Chapter 2 Communicating Effectively With
  Clients

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Learning Objectives
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Learning Objectives

• 1. Explain the importance of communicating
  effectively with clients throughout the financial
  planning process.
• 2. Explain the three main types of structured
  communication used in financial planning.
• 3. Explain the importance of structuring
  communications, building rapport, and handling
  resistance in communicating with clients.

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Learning Objectives

• 4. Explain the attributes of an advisor that
  facilitate communicating with clients.
• Describe several basic communication principles.
• Explain the importance of attending and listening
  skills to communicating effectively with clients.
• 7. Describe several types of leading responses.
• 8. Compare the advantages and disadvantages of
  several types of questions used in financial
  planning.

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Discussion Break

• How conscious of body language are you in
  everyday conversations?
• Do you manage your own body language...
• with clients?
• with friends?
• with family?

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Interviewing
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Interviewing
Process of communicating with a predetermined and
specific purpose

• Directive interview
• Example Gathering client data by interviewing
  him or her

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Directive Interviewing

• Formal, structured
• Strengths
• Brevity
• Organization
• Weaknesses
• Inflexibility
• Losing the story for the facts

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Nondirective Interview

• Client controls pace and depth of response
• Strengths
• Flexibility
• Depth
• Easier to build client-advisor relationship
• Weaknesses
• Time consuming
• Easier to miss something

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Counseling and Advising
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Counseling

• Connotes an offer to help
• Less formal and structured than interviewing
• Promotes understanding of issues faced rather
  than solution to problem

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Financial Counseling Is NOT

• Marital counseling
• Legal advice
• Tax advice

Being empathetic and understanding is important
but client may need professional services you
dont provide
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Advising

• Provide specific guidance or suggestions
• Best used when advisor has professional knowledge
  that isnt readily transferable to client.
• Offer after relationship developed or client may
  not accept
• Does advice foster dependency?

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Communication Considerations
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Communication Considerations

• Structuring communications with clients
• Balance need for information against need to
  build relationship
• Dont waste client time gathering facts if
  available another way

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Communication Considerations

• Developing rapport with clients
• Mutual acceptance
• Alleviating concerns

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Social Styles
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Social Styles

• Driver
• Analytical
• Expressive
• Amiable

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Driver

• Action-oriented
• Likes to lead
• Control
• Tell versus ask

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Analytical

• Thinking-oriented
• Facts lead
• Builds to a decision based on information

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Expressive

• Intuition-oriented
• Emote, tell

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Amiable

• Relationship-oriented
• Emote, ask

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Effective Communication
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Communicating Effectively

• Listening skills
• As important as speaking skills
• Communications goals
• Keep in mind for
• Relationship/goals data
• Communications structure

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Resistance

• Continue communication and relationship building
  by
• Dealing with client resistance
• Recognizing client resistance
• Knowing sources of resistance

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Resistance

• Dealing with client resistance
• Recognize and categorize
• Keeps the communications flowing and relationship
  building

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Sources of Client Resistance

• Privacy issues
• Death/dying
• Marital discord
• Separation/divorce
• Disagreements over the children
• Empty nest issues
• Midlife crises

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Discussion Break

• How do you feel about TV ads for financial
  advisors where the advisor is shown as both
  trusted friend and advisor?
• If you like the imagery, why do you like it?
• If you dont like the image, what bothers you
  about it?

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Attributes of an Effective Advisor
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Attributes of an Effective Advisor

• Unconditional positive regard
• Like and respect have a circular effect
• Accurate empathy
• Identification without and empathy without
  transferring
• Genuineness
• Awareness of clients social style

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Attributes of an Effective Advisor

• Self-awareness of
• Limits and strengths
• Comfort zone, social style, avoidance strategies
• Need to control, need to fix, degree of openness
• Not using own values to frame clients decisions

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Attributes of an Effective Advisor

• Build on your strengths and work around your
  weaknesses
• Will give you more satisfied clients and a better
  practice
• Orientation to values
• Respect differences

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Communication Principles
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Basic Communication Principles

• Elements of nonverbal behaviors
• Attending and listening skills
• Active listening
• Questions
• Statements

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Elements of Nonverbal Behaviors

• Body language
• Positions
• Movements
• Gestures

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Elements of Nonverbal Behaviors

• Facial expressions
• Eye contact
• Voice

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Interpreting Nonverbal Behaviors

• Only clues or indicators
• Not infallible
• Two-way nonverbal communication
• Client and advisor

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Attending and Listening
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Physical Attending

• Square on
• Open posture
• Lean in
• Good eye contact
• Stay relaxed

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Active Listening

• Nonverbal communication plus
• Understanding responses
• Continuing
• Restatement of content
• Reflection of feeling

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Active ListeningResponses

• Clarifying response
• Facilitates clients self-understanding
• Attends to clients feelings
• Communicates advisors understanding
• Moves client toward clearer definition of problem

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Active ListeningResponses

• Summarization response
• Leading responses
• Explanatory
• Interpretive
• Reassuring
• Suggestive

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Questions
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Questions

• Open-ended versus closed-ended questions
• Leading questions
• Either/or
• True/false

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Questions

• Why questions
• Question bombardment

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Concluding Remarks

• Statements
• Advisor is responsible for what is said
• Questions
• Client is responsible for what is said

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Financial Planning in Action
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Chapter Two Review
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Chapter Two Review

• Interviewing, counseling, advising
• Structured versus unstructured communication
• Self-awareness
• Client awareness

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Chapter Two Review

• Nonverbal communication
• Active listening
• Steering your responses
• Asking appropriate questions
• Making appropriate statements