New meaning of risk v return emerging?

In the old days of financial planning a few of the ‘rock stars’ headlining the conferences relating ‘how to be great’ were natural rapport builders. Their reputation and presentations stank of personality traits and habits to ‘get clients to like you’ and then they’ll buy from you.

Back then, the industry called these people “hunters”.


The thought of a client being ‘hunted’, caught and dragged back to a team of eager, waiting ‘farmers’ lacks a fair degree of professional substance. The term just doesn’t cut it these days.

Or does it?  

When markets were doing the industry’s running and even the dud products were hot, the ‘risk’ v ‘return’ was a no-brainer (remember back in 2007 when the median balanced superannuation fund return was 15.65%? – the industry was busier than the ASIC commissioner).

Unfortunately this rapport building DNA is still deeply entrenched within our industry.

In our coaching with financial advisers we spend a lot of time “de-rapport building” our clients to get them ready for the new ‘risk v return’ world.

Rapport is important, but it doesn’t always lead to trust.

On the other hand trust always leads to a level of rapport.

How do you build that trust?

Do for the client what the client should do for themselves, if they knew everything you knew.

Even when the advice will challenge them, even when the approach will confront them, even the on-going advice relationship will attempt to change years of their bad financial behaviours, even when the advice is ‘boring’ compared to the sexy new trends.

Anyone can give ‘easy’ advice particularly in ‘easy’ ‘soft’ markets.

Like all relationships, long-term advice relationships aren’t built on ‘easy’ conversations, but ‘tough’ conversations.

The only reason you’ll build great on-going advice relationships because EVERYTHING you advise, EVERY year is only for one clear, authentic reason.

To help your clients better achieve the outcomes they aspire to.

That will mean you have to at times ‘risk’ the on-going relationship (and the ‘return’ they and you will earn) and challenge them when you believe there are better ways, better directions, better behaviours to best achieve the outcomes meaningful for them.

There’s a new meaning to ‘risk’ versus ‘return’.

Is your firm ready for it?

What do you think?

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