Financial advisors would make terrific novelists. Who knows better the inner workings, fears and dreams of people in the grips of life's major transitions? Who else has experienced humanity's highs and lows so intimately?
The stories advisors tell-some funny, many embarrassing-make a treasure trove of practical wisdom. Here are a few favorite, valuable tales.

Talking Too Much
"A formative experience for me, though I feel chagrined by it now, was my first client meeting," says John Graves, managing partner at the Renaissance Group, a financial advisory firm in Ventura, Calif.

Back in 1986, Graves and his new boss were paying a house call to a potential client when something went wrong. Every time the client began talking about his financial goals and concerns, Graves would jump in with suggestions. When his boss kicked him under the table, Graves misread the signal. "I thought he was just crossing his legs, so I moved over to get out of his way," he says now. "But I could not get out of my own way! I just couldn't keep my mouth shut."

Afterward, in the car, his boss turned to him and said, "'You idiot! You lost that deal! You have two ears and one mouth-use them accordingly.' And, of course, he was right," laments Graves. "The client, who would've been a six-figure account, never did call us again."

Clients Must Talk
The silver lining was that Graves learned an important lesson-the type that's never taught in schools, he notes. "You have to not only shut up but encourage clients to talk about their thoughts and feelings," he explains. Even now-26 years later-Graves sometimes has to consciously stop himself from spouting quick solutions before his clients are done talking. "I literally put my finger over my mouth to remind myself to be quiet," he says.

But as every advisor knows, not all clients are easily induced to open up. Some are shy, intimidated.

Mitchell Kauffman, managing director at the Pasadena- and Santa Barbara-based Kauffman Wealth Services, has noticed the problem of getting clients involved in their own financial matters-especially with clients from the entertainment industry. "They tend to have little interest in financial affairs," he says.

So Kauffman has developed a few useful techniques. First, he admits his shortcomings. To a musician client, for example, he might confess his own inability to distinguish Bach from Beethoven. "But what I'm really saying is, 'You are proficient in that area, while I have no affinity for it,' which tells the clients not to feel embarrassed and, I hope, empowers them to feel OK if financial matters aren't their area of expertise. After all, that's why they have me."

Learning To Say, 'I Don't Know'
Second, he's straightforward about his own limitations. "When I'm asked a complex question that I'm really not prepared to answer, it's important to admit that-to say 'I don't know, but I will get back to you,'" says Kauffman. "Clients seem to appreciate my honesty."

Kauffman has also learned not to go too fast. If he sees a client yawning, fidgeting or otherwise tuning out, he'll take it as a signal. "I'll stop and ask, 'Is that OK? Does it make sense to you?' I check in and make sure we're understanding each other," he says.

Other Personal Limitations
Yet sometimes an advisor's hard-to-admit limitations have less to do with knowledge than personal obligations.
Brittain Prigge, a director at Atlanta-based wealth-management firm Balentine, recalls a meeting with a nonprofit foundation's board of directors that went awry. "As we were walking into their fancy boardroom overlooking downtown Atlanta, my phone started buzzing," she recalls. "Naturally, I ignored it and began the meeting."

But her phone kept buzzing. She was the only woman in the room, and though she knew and respected the men-"seven high-powered attorneys," as Prigge describes them-she was self-conscious.

Suddenly, something clicked in her head. "I stopped the meeting, which was unprecedented, and checked my phone," she says. "My nanny had been rushed to the hospital, and my children were at a fire station waiting for me to pick them up. They were 3 and 5 at the time, and they were scared."

Tears welled up in her eyes. She announced she had to leave, and conscientiously shook every man's hand before walking out. "Not only did the men understand, but afterward they sent e-mails of concern about my family," Prigge says.

The lesson here is simply that, no matter how prepared you are, there are some things you can't help or control. Flexibility is crucial. And if something unexpected does occur, it's not the end of the world.

Encountering Accountants
But some conflicts are unavoidable. Jeff Gitterman, CEO of Gitterman & Associates Wealth Management in Iselin, N.J., has had many awkward encounters with his clients' accountants and attorneys. "Accountants and attorneys don't know everything," he insists. "I get into arguments with them all the time ... and I'm not argumentative."

For example, when a widowed client established a trust for her kids with funds she'd inherited from her late husband's Roth IRA, Gitterman found an error in the way her attorney and accountant had handled the transaction. The deceased husband had been over 70, he relates, and his wife was the sole beneficiary of the Roth. By law, a required minimum distribution should have been made before the funds were put into a trust.

"Who knows what the purpose behind it is, but that's the law," says Gitterman. "There were no taxes due, but she'd already gone one year without taking the RMD."

Gitterman brought the matter to the accountant's attention. By and by, the required amount was distributed retroactively. The client's attorney drew up papers for the IRS explaining the accidental oversight. All was well. "But there could have been a substantial penalty," says Gitterman.

To avoid unpleasantness, Gitterman is always careful to broach such matters delicately, "in a kind enough way that doesn't make the other guy look bad-especially because you could be wrong!" he acknowledges. "I'll call the attorney or accountant and say, 'I'm not really sure about this, you're the expert, but I read somewhere that Roth IRAs require a minimum distribution of deceased accounts. I'll forward the documentation I've found. Will you please let me know if I'm off base or not?'"

A reputable accountant or attorney will have to concede if you're right, he says. You could even gain a lifelong ally who refers more clients down the road. In effect, you burnish your reputation as a smart, honest team player who goes the extra mile.

Client Blunders
On the other hand, there are cases when it's too late. "One of our favorite clients had entered into a partnership with a builder to construct a house in Alaska," says Kevin Sanderford, a principal at Colorado West Investments, in Montrose, Colo. "The problem began when we realized that although the client's name was on all the mortgage docs, it wasn't on the [property] deed. ... So he had all the liabilities and none of the assets! ... The client ultimately took a loss of $140,000. He now passes ideas by us before he pulls the trigger."

Sanderford has little tolerance for reckless clients. "My biggest regret is trying to work with everyone," he muses. "We can't deliver great service unless we limit the number of clients we serve."

Taking A Stand
Withstanding conflicts is a running theme of many advisors' stories. In some cases, it's even a point of pride. For instance, Michael Pepe, senior vice president of investments at JHS Capital Advisors in Tampa, Fla., says that many of his favorite moments in his nearly 30-year career "are when I took a stand."

One morning in December 2010, his phone started ringing off the hook. Some expert on TV the night before had predicted municipal bonds were on the brink of widespread default. Pepe believed it was an irrational panic and told his clients to stay the course.

"I convinced them not to sell but to buy on the weakness," he recalls. In the end, Pepe was proved right. "We not only prevented our clients from getting caught in a panic," he says, "but took advantage of the opportunity."

Such independent-mindedness can yield surprising results, especially in unusual situations. Madaline Creehan, a principal at BAM Advisor Services in St. Louis, once helped a childless widow sort through years of financial documents-including unfiled tax returns. "She was very intelligent and accomplished, but knew nothing about her financial situation," says Creehan. "Her late husband had handled all that."

Creehan spent days going through boxes and scraps of paper, collaborating with accountants and attorneys, and ultimately gaining the client's full trust. Past-due obligations were paid, and a financial plan for the client's future was formulated. But the icing on the cake came when they discovered the IRS actually owed the client $50,000!

The moral of the story, says Creehan, is that, "especially for women, establishing a relationship can be the key. ... And if you become your client's indispensable strategic partner, you'll have a client for life-one who never hesitates to tell others about you."

Word Of Mouth
Indeed, you never know in what form word of mouth may arise or where it can lead. Ellis Liddell, president of ELE Wealth Management in Southfield, Mich., arrived in the Detroit suburb a decade ago with few clients but a lot to say.
Liddell ended up giving weekly financial literacy lessons on a popular local radio station. It proved a surprisingly effective marketing tool. "I didn't do it to get new clients," he says. "I just wanted to educate people."

Nevertheless, Liddell quickly found a population of affluent but largely uneducated manufacturing professionals who were hungry for his type of advice. "Many had managed to save money but had no retirement plan," he recalls. "Folks came to my office and said, 'Mr. Liddell, I never heard of a 401(k) before I heard you on the radio. I wish you had come along years ago!'"

Liddell ultimately amassed more than a thousand loyal clients.