I learned a valuable lesson from a colleague whose Mom had just retired. My friend, who is also a financial professional, held his Mom's hand throughout the entire retirement process. He ran the numbers for her, suggested investments, and ultimately helped her complete all the paperwork. A proud son, he felt good about his efforts and attention to details. A few weeks, later he got a call from her. His Mom was petrified. "Something's wrong," she said. "I haven't received the check you said I was going to get." Can you imagine? Her first retirement paycheck wasn't there, which made her immediately nervous about the decision to retire and about trusting the process. "You said I would get the money by the fifteenth," she lamented.
My colleague shook his head and said, "I had to step back and explain the behind-the-scenes process she wasn't familiar with. I had to retract my statement about getting her money on the fifteenth and explain that was the day the money began the journey to her account, which could take three to five days, depending on the day of the week and her bank's process for making funds available." He of course, took all that for granted. He could see the process in his head, but didn't relay the information clearly. I thanked him for the lesson learned as it was a great reminder of the significance of transitioning to retirement, and how people can go into shock if they misconstrue the unfolding process. With the recent increase in the prosecution of perpetrators of ponzi schemes and other client fraud, our industry and our personal reputations remain at risk until clients truly experience what we tell them is going to happen.
In the end, whether it's setting good expectations, or walking a client through various product or service tradeoffs, it boils down to finding new ways to add value to the client relationship. Advisors who help clients understand how and why they make decisions, as well as the current and future impact of those decisions, will not only build trust and loyalty among their clients but also help foster a new industry standard that extols a complete and personal relationship rather than just dollars and cents.
Robert Laura is the president of SYNEGOS Financial group, co-founder of RetirementProject.org, creator of the Laddered Dividend Portfolio, and author of Naked Retirement. He can be reached at 888-267-1138 or [email protected].