An honest answer, please.

Your client receives a healthy lump sum, followed by scheduled million-dollar payments for the next five years. Daily, you see large distributions. There’s always a story. “My parents need to move. My brother wants a car. I had to take in my niece. My friend lost her job.” You see what others are doing to your client, but it doesn’t stop. Frank discussions ensue, landing on deaf ears. “If you continue to spend at this rate, you will run out of money.”

Are there times when your human psyche and personal emotions carry more weight than subjective and rational thought? What do you really want to say to your client? Are your calls avoided? Have you elevated yourself from advisor to a stream of unwelcomed consciousness? How about the client who provides a small part of his large estate to a second spouse just to placate his children who squander money? Instantly, do you reason unfairness?

The ways that we naturally and instinctively categorize people, filter information, ration our attention, rely on cultural norms and default to rehearsed ways of thinking all relate to our biases and our own familiarities. My objective in writing about this subject is to think and reflect on my own actions as a planner and in this process explore ways to improve awareness. I see my role not only as an advisor, but also as an advisor-student constantly learning by systematically reflecting on my own practices and hopefully producing a narrative of such reflection that conveys consciousness for others. I invite you to reflect on your own practices.

In some ways, I feel like this exercise is slightly related to principles of mediation: believing in our professional selves whom we know best while being unbiased advisor-mediators who avoid inserting our own judgments or directions. To circumvent injecting bias:

The advisor-mediator should not come to the meeting or discussion with any predetermined goals or judgments. You must be objective, even though you are keenly aware of your own biases. One principle of mediation is that your client knows best. Regardless of what you as a planner see from your viewpoint, you are the outsider and cannot ever truly know the client’s viewpoint and experience. They are the experts on their own needs and objectives.

The most effective advisor-mediator follows the client’s story and develops a deep understanding of the issues that arise from this respectful interaction. Learn to create environments that allow for a great deal of exchange within the discussion, in lieu of lecturing. Take the time to identify their needs without making assumptions and thinking you intuitively know what they want. Beware of becoming so preoccupied with knowing the answer that you forget to hear the question. Dictating at the expense of listening limits your ability to understand the issues thoroughly. They are soliciting your advice, after all, so it is important that your counsel is provided with as much information as possible.

It is not true that advice receivers and advice givers are hierarchal in nature. Remove statuses and level the playing field; only then can truth and trust prevail. Unbiased planning involves behaving in as neutral a fashion as possible. It involves being aware of the power in the dynamics of the relationship. It involves helping the client give his or her perspectives without requiring an approval or confirmation from you in the process. It involves asking open-ended questions that don’t steer your client in a way that might appear to endorse a particular response. It involves modeling your meetings after conversations between two trusting parties.

Establish And Maintain Credibility
To further complicate matters, clients may come to you with preconceived notions. They have been listening to a friend’s advice and possibly an overabundance of unfiltered market predictors. It’s imperative to remember that they are listening to your advice based upon your credibility and their belief in you. They must have confidence in the facts that:

• You are more knowledgeable about the subject matter than they are.
• Your advice is not geared toward popularity or a “yes-man” mentality, but one of concern for their best interest in that point of time within their financial life cycle.
• You are trustworthy, which encourages faith in your decision-making.
• Your role is that of an educator, encouraging them to think.
• You don’t change your message depending on the client, only the client’s needs.

In our industry, reliance relationships will only grow in importance as situations become more sophisticated and the need for specialization grows. It seems clear that conflicts of interest and resulting biases will only proliferate as those with expertise, or the appearance thereof, seek to exploit those advantages. Instead, try to:

• Stick with the facts, statistics or information that will enable informed decision-making.
• Maintain appropriate protocol and integrity by having built-in procedures of checks and balances to ensure the integrity of your recommendations.
• Set up diverse and cross-cultural advisory boards.
• Spend time getting to know and appreciate your client’s culturally diverse background.
• Avoid financial slang that may intimidate or demean the listener.

Lawyers, physicians, mental health workers, educators, financial planners—we all provide advice. The surgeon has a much better ability to determine how best to treat gallbladder pain than the patient, thus the patient reasonably relies on the surgeon for advice.

Encourage Implementation
It depends on each client, each patient and each student to make his or her own more or less rational decisions as to their own involvement in following through on the advice. The client, now the “decision-makee,” must rely upon her specialists who have developed expertise in understanding her specific situation. The economics of those advisory relationships then become the central questions for understanding roles played in our interactions.

“You can lead a horse to water but you can’t make it drink.” Or you can show clients a better way to manage their finances, but you can’t force them to follow through.

It’s true that clients may reject advice that’s different from what they themselves think. A recent survey authored by Sendhil Mullainathan, a Harvard professor and top behavioral economist, found that two-thirds of the people interested in meeting with a financial planner were likely to implement the advice “only if it conformed to their own ideas.” This explains why biases that undermine strategic decision-making often surface during the implementation phase of planning.

What is power but the ability to set a course of action and induce others to follow it, either by their own free will or by compulsion? Remember the advice-giver’s goal: to see that plans are followed through. Being seen to be swayed by indecision could cause one to lose status, and could prompt an implementer to question the recommendations.

What happens to our own attitudes toward clients when they don’t see the value in our advice and neglect to execute it? I liken this to using a book on healthy eating. You buy the book, read it and use the good advice that it contains to improve your dietary best practice. You do not implement the advice letter for letter, however, and chances are that you just don’t like some of the foods being recommended, or they’re not available locally. Just because you did not follow ALL the ideas contained in the book religiously does not mean that you didn’t gain value from your investment. Your client’s time table or sense of priority may not highly correlate with your agenda. Be patient, be kind, provide follow-up and friendly reminders. Make implementation so easy they don’t know they are doing it.

Lastly, walk in their shoes. Let’s face it. We’ve all been evaluated—performance reviews, industry ratings, medical checkups. What happens when you go off track? What happens when you don’t conform to the norm or expectation? What happens when you don’t follow the advice? Are you provided the guidance and education to make a sound and thoughtful decision on your own or are you simply judged based on adhering to or ignoring a recommendation?

Think about the situation and ask yourself what do you believe in, not as a planner but as a human being? Do you think it is possible to be totally unbiased about a circumstance, to have no opinions one way or the other? I conclude not.

But you can build a foundation of useful information gathered by using more “intuitive” methods such as conversations, observations and reflections. Clearly, the question of the connection between who I am and what I recommend is a multifaceted one, influenced by life circumstances, existing career and opportunity, as well as intellectual and philosophical orientation. To a degree, that’s acceptable because with experience comes knowledge—knowledge that can be shared, not forced. And with that, all prosper. 

Catherine M. Seeber, CFP, is a Principal and Senior Financial Advisor with Wescott Financial Advisory Group, with offices in Philadelphia, Boca Raton, Miami and San Francisco. She can be reached at (215) 979-1642 or via e-mail at