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Lockie: the questions planners should be asking their clients

Good questions allow clients to really think about their financial futures and consider how they want their hard-earned income to be invested to achieve their goals

Lockie: the questions planners should be asking their clients

It drives me mad when a financial planner says a client’s objective is capital growth.

Capital growth is not a client objective; it is a means to an end to get the client where they want to be. I have never met a client yet whose ‘objective’ is solely capital growth.

They want growth to meet a defined objective, such as retiring at age 60 on a net income of £75,000 a year; an outcome that is qualified and quantified.

Meeting of minds

Since September 2018 I have been talking with New Model Adviser® about the quality of the questions financial planners ask their clients. NMA tested this at a roadshow event and the response was not great.

Questions such as: ‘why have you come to see me?’ or ‘what can I do for you?’ might be sensible openers, but I am looking deeper. You might have seen two articles I asked our certified financial planning (CFP) professionals – Carolyn Gowen, branch principal at London-based Bloomsbury Wealth  and Amyr Rocha-Lima, partner at London-based Holland Hahn & Wills  – to write for NMA on client questions. But even these are just scratching the surface.

Good quality questions lead to lots of good quality answers. They allow clients to really think about their financial futures and consider how they want their hard-earned income to be invested to achieve their goals.

On my travels around Europe and visiting various conferences and at meetings we have been discussing just this. I have also picked up great questions from the likes of American entrepreneur John J. Bowen Jr and finance author Moira Somers, along with CFP professionals from across the world.

By adding all these together, I have gathered a large library of good quality client questions. If you like them, I would like you to start using some of them. It might even prompt you to find better questions than these. I would love to hear them.

Values: what did you learn about money from your parents?

Goals: when you think about your money, what concerns, needs or feelings come to mind? What are your top accomplishments? What would you like them to be?

Relationships: what concerns you about either your health or the health of your family?

Assets: what were your best and worst financial decisions? What happened?

Advisers: do you have an accountant? How do you feel about the relationship?

Process: how important would it be to go through a methodical evaluation of the potential financial and lifestyle risks you face?

Interests: once you have retired, how are you going to fill the time once occupied by work to ensure you have a meaningful life? 

Top five

These are just a few good questions, but I have many more. How about the top questions that CFP professionals and financial planners ask around the world? These five appeared in the New York Times in an article by Ron Lieber in 2016:

1. What does the word ‘money’ conjure up for you?

2. How many adult children would you like to have to oversee your health and financial wellbeing when you retire?

3. Tell me about your financial situation when you first met your partner or spouse.

4. What are the most important things in your life?

5. What does the prospect of retirement look like to you?

Getting answers to these sorts of questions can help you understand deeply what your clients really want from life. My challenge to planners is: what great questions can you start to include in your conversations with clients? And who has better questions than these?

If you do have better questions then let’s hear them. Sharing these insights helps the whole financial planning profession.

Jacqueline Lockie is head of financial planning at the Chartered Institute for Securities & Investment

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