As a psychologist, I work with people who in some ways are struggling with everyday living. In the process we sometimes discover that their emotional difficulties are related to their money beliefs and behaviors. In the past, these included gambling addictions, financial stress due to job loss, spending patterns, and parenting strategies among others. As a result, I frequently find myself on the emotional end of my client's money management dilemmas.

Similarly, financial professionals are also approached by their clients with personal issues. A recent survey of 1,374 financial planners (Payne, Dubofsky, & Sussman, 2010) found that 92% of responders spend about a quarter of client contact time discussing topics unrelated to money management. These included relationships, substance abuse, mental or physical health, spiritual beliefs, and others. Perhaps because money tends to be such an intimate subject that it is frequently a taboo even among family members, those comfortable sharing money matters with a financial advisor also feel that way about other deeply personal issues. It does not hurt that similarly to the psychotherapists, financial professionals, unlike family and friends, can also be seen as neutral outsiders.

Unfortunately, most financial planners and advisors are neither trained nor feel competent to delve into emotionally-laden topics. However, such situations present opportunities that can lead to high-quality relationships, resulting in client retention (Tohidinia & Haghighi, 2011). Fine tuning communication skills, learning ways of managing scenarios that impinge on the boundaries of competence, and negotiating the process of referring when more specialized help is indicated will help you to provide your clients with experience that could differentiate your firm from your competition.

Some of the strategies outlined below are no more than superb communication skills borrowed from the practice of psychology. While many of the elements should be very familiar to most financial professionals, other topics, such as replacing advice-giving with listening, could be counter-intuitive to those in advising positions. Yours and your clients' success will depend on the flexible application of these strategies in appropriate situations.

Ask open-ended questions.
The key to relationship gains lies in the interactive process itself. People rarely want advice, even when they appear to be asking for it. Most would like an opportunity to verbalize concerns in the presence of a supportive other. Prior to articulation, a stressful experience may only be vaguely understood. The process of translating it into language results in clarity about the issue at hand, thus allowing potential solutions to come into view. It is also likely that the individual has already considered every possible option and is on the fence regarding which way to go. Explaining the pros and cons of these options to another individual provides an opportunity to re-evaluate them once again.

To facilitate the decision process, start by asking open-ended questions. For example, "What are your concerns about your father?" would encourage more in-depth processing than a question requiring a "yes" or "no" answer. Just as importantly, it creates an opportunity to listen and to show that you care about your client's life. By reminding yourself that you do not have to have the answers allows you to grant the client space to process his or her concerns.

Suspend judgment. Good communication skills include listening without processing, analyzing, or preparing a response. Because humans have limited attentional capacity, the above cognitive processes result in a loss of at least some of the information being conveyed. Listeners are frequently concerned that they may forget what has been said. They also worry that they may not be prepared to respond at the appropriate time. However, a pause prior to reply actually signals that the listener gave the conveyed information careful consideration. Reflective listening, covered next, will help you to better hold on to what is being communicated.

Listen reflectively.
Reflection involves restating in your own words the speakers message and conveys interest, attention, and understanding. Let your client know you are engaged by asking clarifying questions or summarizing: "If I understand you correctly, you are concerned that giving financial control to your child would result in money being used for purposes you do not approve of." Such statements can also help you to retain information and create an opportunity for the client to further expand on concerns.

Utilize body language.
It is estimated that 60 to 65 percent of communication occurs on the non-verbal level (Hargie, 2011). Non-verbal messages can support or contradict the accompanying words and not paying attention to own or client's non-verbal communication can significantly reduce the chances of the interactions proceeding successfully. While non-verbal communication serves many functions, two of these are particularly relevant to the topic of relationship management. These include expressing emotions and interpersonal attitudes and are signaled by facial expressions, body movement, and gestures. These are also closely tied to the concept of emotional intelligence described below. Other non-verbal behaviors such as amount and loudness of speech, touch, and proximity, among others, can also convey social power and relative status and serve to reduce or increase your social distance to the client.

Communicate empathy. One of the most important non-verbal communication behaviors is empathy. To build and maintain relationships, it is crucial to engage the clients on emotional level and empathy is one way to accomplish this. It involves sharing, on affective but also logical level, subjective experience of another person. It means "stepping into another person's shoes" in an attempt to view events from his or her perspective. Congruence of your emotional expression and even posture with that of your client can communicate empathy. Unfortunately, these are not "techniques" that could be easily "faked". Years of evolution left humans highly attuned to others' emotional states (Rozelle, Druckman, & Baxter, 2006). True empathy could be particularly challenging for those who need to sharpen their Emotionally Intelligent behavior, which is covered below.

Work on improving your Emotionally Intelligent Behavior.
In the last two decades, Emotional Intelligence (EI) has been an exceedingly popular topic in a variety of literature. Partly aided by a very successful book by Daniel Goleman (1995), business world practitioners and researchers alike have, unfortunately, muddled this potentially useful concept by including in its definition all kinds of personality attributes. Many of these attributes, such as assertiveness, happiness, self-esteem, optimism, and others have little to do with true EI.

The concept of EI as another dimension of human intelligence was originally proposed by Salovey and Mayor in 1990. As such, in the words of David Wechsler (1944), it contributes to one's ability "to deal effectively with environment". Salovey and Mayor defined EI as the set of abilities that include perceiving emotions in oneself and others, using emotions to facilitate thought, understanding emotions, and utilizing emotions to achieve specific goals. Thusly defined, EI has been found to predict business outcome, effective interpersonal behavior, interpersonal sensitivity, as well as lack of many undesirable qualities (as reported by Mayer, Salovey, & Caruso, 2008).

To better understand the function of EI, consider the following example. A financial advisor is meeting with a couple that had a money-related argument on the way to the meeting. If the advisor is emotionally intelligent, he would perceive the emotions, possibly anger or frustration, expressed on the people's faces. He would also notice that he is starting to experience anxiety. Reflecting on his own reaction, he would reason that he is concerned about the effect their disagreement may have on his ability to conduct the meeting. Furthermore, he think that it may decrease the likelihood of the couple's ability to work on the financial plan he is about to propose. Armed with this information, the financial planner would comment on his observations and ask for the couple to clarify or validate his concerns. This would start the necessary dialog regarding the clients', possibly divergent, financial goals.

Work with a coach.
Executive coaches have been successfully used in the business world to assist individuals with improving their interpersonal effectiveness. No longer viewed as a tool to correct underperformance, it has become a way to help business leaders succeed. Some have estimated that it produces an average of nearly 6 times the return over the initial investment into coaching (MCGovern, Lindemann, Vergara, Murphy, Baker, & Warrenfeltz, 2001).

The executive coaching model can be easily applied to the financial services industry. A coaching approach can range anywhere from an informal consultation with the coach sitting in on the client meeting and all the way to a formal coaching engagement.
If you are considering working with a coach, look for one who is also a licensed psychologist. While the psychology license helps to establish a minimum level of expertise, graduate training in psychology provides the coach with a number of skills not typically possessed by professionals with business or other backgrounds. These include the skills of assessment, knowledge of human development and behavior, practices such as confidentiality that are dictated by the ethical standards of the profession, ability to impart behavioral change, awareness of own biases, and many others.

Know when to refer out. It is my recommendation to resist taking on a therapeutic role or pushing clients out of their comfort zone, as has been suggested elsewhere (Kinder & Galvan, 2007). The issue is the financial professional's readiness to handle all of client's potential disclosures and intense emotions and the damage that can result from advisor's recoil reaction. Even without the extra prompting, at some point you may realize that you are unable to be of assistance or that more help is needed. When making the decision to refer, I suggest relying on your gut reaction: if it feels like you are "over your head," you probably are.

Because many people maintain an overly-narrow view of psychological counseling, it is important to educate your clients about the type of assistance these services can offer. It may work to state that you maintain a network of professionals from other disciplines who consult you and your clients on matters where you may be lacking expertise. Since training and expertise of mental health providers varies, collect recommendations from friends, colleagues, and clients for professionals to add to your referral list. Consider including psychologists, clinical social workers, drug and alcohol counselors, psychiatrists, and spiritual leaders.

Although financial industry professionals are frequently challenged by clients who bring up sensitive personal issues, these encounters present opportunities for positively impacting clients' lives and forging high quality relationships . To further improve communication skills, better utilize emotional intelligence, and increase the range of behavioral repertoire for dealing with these situations consider utilizing the strategies describe above, attending related seminars, and working with a coach. The likely result would be a stronger bond with clients, higher client retention, and an improvement in the overall quality of life for you as well as the people you serve.

Nora Maidansky, Psy.D., is a licensed psychologist, the president and founder of The Human Aspect, LLC. For more information please visit or email her at

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