It was obvious they needed to either reduce their spending or sell some of their assets, or both. The Monte Carlo simulation demonstrated that their current course would have virtually no chance of success. Our initial discovery process did not reveal to them or to us why they were so reluctant to change their ways. The reality is, you cannot solve interior issues with exterior solutions.
Then, at one of our meetings, I shared some personal information about my money life-issues I had discovered at George Kinder's workshop. When they returned for our next session, they told me they decided to sell one of their homes and reduce their expenses by $50,000 a year. Their chances of success improved from 12% to 86%. When I asked what had made them change their minds and implement our recommendations, Richard answered, "At our last meeting when you shared your story with us, you became a human being.
Rita and I discussed our situation when we got home and decided that it was in our best interests to follow your recommendations."
We ask questions about our clients' histories and relationships with money. We do it to better understand their motives, values, issues and the potential constraints that may hinder their ability to achieve their goals. This is invaluable information as we develop lifetime plans for our clients. The unintended benefit of these questions and of sharing our lives is that it builds deep relationships and trust that would probably take years to develop otherwise. Some advisors ask their clients to write biographies. Others ask simple questions, like the one I asked of Dr. Chang. Regardless of how it is done, it is important to the work we do and the relationships we build to understand our clients' stories. And along the way, it helps if we share our stories with them.
You may not be able to predict what it takes to bond with your clients. I only know that doing so is essential if we are to be effective financial life planners. Listening to Dr. Chang and sharing my story with Richard and Rita helped me make such connections.