Your doctor may advise you to avoid certain foods and do exercise to improve your health. Or your financial adviser may recommend that you take steps such as cutting your spending and paying off your debt, to improve your financial outlook.
So why, after approaching professionals for the benefit of their expertise – and paying for it – do we often not follow through on the advice we receive?
There are many reasons. We may struggle to overcome an addiction – to cigarettes, sweet foods, shopping or gambling. We may find it takes more effort or bigger changes to our lifestyle than we anticipated. Or, as is so often the case, it may simply be that our busy lives crowd out our good intentions and they fall by the wayside.
Dr Moira Somers, a psychologist, professor, author and executive coach based in Winnipeg, Canada, has studied this phenomenon in depth, and has had success in providing guidance to financial planners on what they can do differently to ensure that their advice “sticks”.
Her book, Advice that Sticks (Practical Inspiration Publishing), has become an international best-seller.
Somers believes that if you as a consumer are paying professional fees for advice, it is the obligation of the professional you consult not only to give you appropriate advice, but to ensure that you are heeding that advice and staying on track to reach the goals that have been set.
Her research has shown that whether advice sticks or not lies largely in the nature of the client-professional relationship. You need to be wholly comfortable about telling your adviser about your money (and related personal) issues, and the advice you receive must be easy to understand and within your capability to implement.
In a presentation to Certified Financial Planning professionals at the recent annual convention of the Financial Planning Institute in Sandton, Johannesburg, Somers said all advice is ultimately emotional in nature. It is helping people to see the value in following a course of action and then helping them to persist with their journey.
An adviser’s knowledge of his or her field is a given, she said. It’s how that knowledge is imparted and applied that separates a truly effective adviser from a merely competent one.
Somers says there are three strategies advisers can use to provide a more effective service to clients.
Strategy 1: Follow through
Advisers must follow through on the advice they give you, Somers says. They have just as big a role in ensuring a positive outcome as you do. There is a tendency among advisers to put the blame on the client if the client does not heed the advice given, she says. Therefore, it is necessary for advisory practices to cultivate a culture of empathy and for office workers to avoid criticising clients behind their backs.
There is more to the financial planning profession than having the required expertise. “The hidden part of the job description is helping clients to behave - standing between them and stupid,” Somers says.
Strategy 2: Avoid information overload
Somers says research has shown that the information advisers give their clients is often too much and too complex. Clients report “feeling stupid” in meetings. Don’t be taken in by an adviser trying to impress you by using financial jargon you don’t understand.
“The average doctor learns 13 000 new terms in medical school. Financial professionals are probably not far behind,” she says. Advisers must simplify their language, minimise the jargon, and provide one-page summaries of complex documents.
“It is not a licence to become vague or slippery, but documents can be written in plain English that people can understand.”
When the information is too much and too complex, you can drive clients into the hands of charlatans, who really know how to connect, Somers warned advisers.
Strategy 3. Assess clients’ readiness to act on advice
Somers says your adviser should assess how ready you are to act on the advice given to you, not assume it. Her research has found that only about 20% of clients are truly ready to engage “right now”, and one must accept that the base rate of adherence generally is low.
She says it may take a few minutes of an advice session, but a readiness assessment is worth that time: it can prevent wasted effort and discouragement, and preserve a positive client-professional relationship. Such an assessment would involve questioning you on how you would feel about taking certain steps and your confidence in accomplishing them. Such steps need to be comfortably doable and bring immediate relief, not just chase long-term goals.
Somers says your adviser should be working to your agenda, not dictating to you and pushing you to comply with his or her recommendations. Ambivalence is an important part of the dialogue, she says.