Sarah was concerned about her upcoming review meeting with existing clients, Adrian and Jane.
Still in her late-20s, being qualified for only eighteen months, working a small client base of ‘lower-end’ clients her firm had inherited from when they purchased a client base from a local retiring adviser, Sarah had little experience leading re-pricing conversations designed to increase fees for existing clients.
Her challenge was to effectively position the new minimum fees without reliance on any of the value and rapport that their former non-retired adviser may have provided.
Sarah was well-trained in the listening, probing, positioning, management and control skills to re-engage them as their principal adviser. She wanted to focus this meeting on discussions about what is of value to them, not only a review of circumstances.
Unfortunately, there was another problem from the meeting’s get-go.
Despite preparation and prior confirmations, only Adrian joined the Zoom call.
Jane was “too busy and not interested in how the superannuation is performing”.
Sarah suggested another time?
Adrian said Jane still won’t be available.
Sarah pressed forward, hoping Jane might reconsider.
The Re-Discovery Meeting
What Sarah uncovered with Adrian was extraordinary.
After a brief conversation about Adrian’s superannuation questions, the value discussions were deep into significant value.
While Sarah’s file notes were clear that their youngest child had a medical condition, the fine details were years old.
Adrian, 56, and Jane, 51, had been managing their 26-year-old son Stevie’s medical condition for years. But the situation was sadly deteriorating. Stevie now required permanent care—feeding, dressing, toileting—and would likely live with them indefinitely.
Adrian shared his distrust and disappointment with the constantly changing NDIS funding promises they have relied on to finance Stevie’s condition to date.
Adrian believed his former hopes of a retirement in his early 60s would now, at best, be in his early 70s.
Dreams of caravanning around Australia were unlikely, as they could not leave Stevie for too long or be too far away.
Adrian had significant worries about how to fund Stevie’s future accommodation needs, whether they could invest in a share-home arrangement, and what would happen if they needed to sell their family home for their own aged care.
On top of all this, Adrian also needed to support Stevie’s elder sister, as she would require assistance in establishing herself in the coming years.
When Sarah asked why Adrian had not shared his concerns with their previous (now retired) adviser, he responded, saying he never asked nor expected him to, as he was their superannuation adviser.
Post Re-Discovery
However, by the end of this advice meeting, Adrian felt exhilarated.
Sarah obviously did not provide any specific ‘right’ answers, but she believed he was 99% ready to include Jane in the discussions to align her hopes and concerns with his own. There were no guarantees, but there were clear steps to manage some better, if not all, desired outcomes.
Sarah made it clear there will probably be additional fees, but with no obligation unless both Adrian and Jane believe the advice is of value.
A day or two later, Adrian called to say thanks.
But no thanks.
Conversations with Jane after the meeting had concluded, they wouldn’t be paying any more money for advice.
They will keep their current arrangement and reconsider sometime in the future.
Sarah’s offer for her or one of the firm’s partners to speak with Jane directly was politely refused.
The Truth of Advice Value
Sarah’s experience illustrates a critical truth: value isn’t objective —it’s subjective.
While Sarah did a great job uncovering what is of value to Adrian and his complex financial needs, Jane’s lack of participation doomed a valuable renewed advice relationship.
Jane only heard a secondhand summary, which is never like being there. To her, it appeared their new adviser could be manufacturing problems to justify higher fees.
There are three key steps for valuable re-discovery meetings:
First, position the significance of understanding the subjective value of advice uniquely, methodically and consistently for all stakeholders. Subjective value cannot be presumed through retelling—it is best lived with a skilled advisory team in real-time.
Second, structure initial discovery and annual re-discovery conversations to build progressive revelation. Start conversations expecting to hear pressing concerns (e.g. costs, performance, questions), then systematically probe deeper into each client’s circumstances, fears, or aspirations that may require either money, advice or planning.
Third, position on-going advice relationship as one built upon a better day-to-day ‘path’ that aims to avoid the consequences of any inaction, rather than upon the performance of a particular ‘product’.
For advice teams, the choice is clear: invest in the team skills to drive consistent, methodical and specific discovery conversations with the key stakeholders within every client (i.e. couples).
While it is common for one member of a couple to be more interested in the couple’s finances, it is ridiculous to assume that only one member nails what is of unique value to each of them.
For existing clients, this does not need to be done yearly, but it must be consistent because subjective value – the driver of every client’s fee decision – can and will change.
What do you reckon?
Jim
Photo Credit: Shuterstock_244717456