Most financial planners sell advice. Because people are willing to pay for it. It’s as simple as that.
This system worked in the old world. Because there was no alternative.
Fortunately, we now live in the age of DIY.
Do It Yourself.
Fortunately, because now, people have the (free) online tools to create their own, new financial planning experience. Which ignites innovation in our profession.
Is this a threat for your financial planning business? Yes, it can be.
Yet, there is an alternative.
You spend less than 10 hours per year with your client – and 8756 without. So does your client experiences your fee as “OK” while there is a free or low-cost-alternative available?
What if the financial planner stops selling advice? And starts selling empowerment?
Imagine if the financial planner – acting as a consultant – prescribing all of the online tools for his clients so that they’ll become the most empowered CEO of their own financial health.
Does it work?
You might think, does this work? It depends.
The financial services industry doesn’t like changes. Because changing means admitting that what you did in the past could be done better.
It also means that people might not like your new ideas. Therefore it’s hard to persuade this group to join you in your new financial planning business.
Instead, you’ll find more fertile ground among seekers, among people who desire the feeling they get when they’re part of a vibrant, growing community, but who are still looking for that feeling.
I’m not talking about disaffected outsiders. Loners who work hard not to affiliate.
I’m talking about people at the fringes, individuals who might jump from one thing to another with less fear, and people who are fed up with the status quo.
They are waiting for things to change.
Do you think that people like to see a change in the financial services industry?
If so, you might want to know what the financial planner has to do to change things. Here are 3 thoughts:
Stop managing, start leading
Managing is about manipulating resources to get a known job done. Burger King franchises hires managers. They know exactly what they need to deliver and they are given resources to do it at low cost. Managers manage a process they’ve seen before, and they react to the outside world, striving to make that process as fast and as cheap as possible.
As the word says, wealth management is managing.
The alternative is leading. So, how about wealth-leading?
Leadership is about creating change that you believe in.
Leaders have followers. Managers have employees.
Managers make widgets. Leaders make change.
Change is frightening, and to many people who would be leaders, it seems more of a threat than a promise. That’s too bad, because the future belongs to our leaders, regardless of where they work or what they do.
Stop advising, start listening
What most people want from their financial planner is something that’s rare to find these days: an expert who listens.
Why is it so hard to find (financial) experts who listen?
Because most experts are eager to tell their clients what they know.
Telling what you know is a poor strategy when your competitor is Mr. Google. Because he knows a lot more than you do.
Stop selling, start empowering
No one expects that the financial planner rings the client’s doorbell or call on their birthday. It wasn’t feasible. But now, the cost of interaction has plummeted. Everyone can thank someone by texting “thnx” from their smartphone between meetings, or send an @reply on Twitter. All at minimal cost.
This means that every planner must recognize that client service and building relationships is now their primary business. That’s why content creation becomes imperative, the initial engagement. When you are transparent and engaging, people will be grateful.
People are grateful because the planner empowers them to use the best online solutions or products with his content.
He shows them the way. He guides.
First with a (free) financial plan. And then with clear and powerful instructions to the low-cost-online-solutions.
But what if you have a question?
No problem, just contact the financial planner. You can call him at each time. Because people pay the financial planner for guidance, empowerment and real value. By a monthly or annual payment.
There is a catch. The financial planner must always work to deliver real value to his clients. Because otherwise the client will wander off and leave eventually.
What if selling empowerment not only means creating great value for a better world, but also ignites a new businessmodel in our financial planning profession? Would that be innovation?
Empowerment – not advice – may very well be the best solution in the new world.
Are you afraid to change?
Do you think that empowerment won’t sell?
Then take a look at the next 11 reasons why people rather do it themselves than hiring a personal financial planner. Or shoud I say a financial empowerer:
I feel secure in putting my hard-earned life savings in a mailbox and sending them to total strangers
I prefer the service I receive from faceless clerks or a computer screen
I have plenty of time to think of what’s really important in my life and how I want to feel
I prefer being thought of as a computer entry rather than a person
I feel online companies that sell to a mass market care about me and understand my specific financial goals
I have nerves of steel. I don’t need a second opinion
I trust my online advisor immediately. I prefer to hand over my assets with two clicks
I am not willing to pay for professional services. In addition to making my own financial plan, I also diagnose and treat my own medical problems, represent myself in legal matters, and file my own taxes
I don’t like probing questions. They make me think too much about what really matters to me
The best solution is the cheapest solution
The best solution is the fastest solution
If you’re not afraid to change, you might want to answer this question:
How are you empowering your clients?
Please, leave your answer here below in the comment field. Thank you very much.
Together we can make financial planning matter.
Loved the I am not willing to pay for professional services line, I also diagnose my medical. some really thought provoking stuff.