Celebrities are always on stage. Ditto for members of the British royal family. Someone is always watching everything they say, how they are dressed and how they treat other people. This is also true to some extent for financial advisors. You might say something you consider witty or simply plain speaking. Your client might take it the wrong way. As the expression goes, “you can’t put the toothpaste back into the tube.” There is also the risk your client is recording the conversation. What words should never be said?
1. That’s why you pay me the big bucks. I know this from firsthand experience. Yes, I actually said that to a client in an unguarded moment. The look I was given and the dramatic pause signaled “I can’t believe you actually said that!”
Why: Clients often think fees are high, especially when they hear about commission free trading elsewhere. They assume 100% of what they pay in fees goes to you. They don’t realize you only receive a portion. In their mind, your statement confirms they are overpaying.
Instead: You may have made a good call or recommendation, but give the credit to your client. “Thank you for taking my advice.”
2. You bought what? (followed by laughter). We were at dinner at a charity event. Someone across the table was telling me about their investments, specifically one that did not work out. I actually said those words! For some reason, I never got their account.
Why: No one wants to feel they made a stupid mistake. They do not want to be the target of laughter in public, even if only one person is laughing.
Instead: Keep a serious look on, asking “Tell me more…”
3. I can ignore that call. They aren’t important. You are meeting with a prospect or client. Your phone rings. You see who is calling and dismiss answering the call. Perhaps you are trying to show this person theirs is an important meeting and should not be interrupted. They do not see it that way.
Why: Other expressions you might have called out to your assistant include “Get rid of them” and “What do they want now?” Your prospect or client wonders if their call will get the same treatment when they are not around.
Instead: Ask your assistant to take a message. Mention you are helping a client, broadly mentioning the activity (setting up a retirement plan). You will call them back after your meeting. Your assistant likely mentions your activity, subtly advertising the range of your services. Your prospect or client knows the meeting is not being interrupted, but you will give the caller attention later.
4. It’s only money. Don’t say “Easy come, easy go” either. “It is only a paper loss” should be avoided too. When monthly statements come out, clients see how much damage has been done in a down month. It’s been said the stock market goes up like an escalator, down like an elevator. Clients feel the pain of losses more than they enjoy gains.
Why: When you lightly dismiss their losses, they see you more like a friendly croupier at a casino instead of a financial professional committed to helping them achieve their goals. They feel you are dismissive, because they feel the losses are very real.
Instead: You have also suffered losses too, but you don’t need to be specific. This is a good time to mention why you have faith in the future.
5. We have no idea what the stock market will do next. Years ago, I actually heard someone say: “It could go up. It could go down. It could go sideways and fool us all.” It might be true no one can accurately predict the future on a consistent basis, but your research department has an opinion on what the future holds and which sectors will benefit.
Why: People work with large financial services firms for many reasons. Personal service is one, but the benefits from an award winning research department are another. When a client asks: “what do you think the stock market will do” they are often asking “What does your firm think the stock market will do.”
Instead: Immediately start talking about your firm’s analysis of the market’s recent performance and what they see for the economy and markets moving forward.
6. It’s firm policy. This expression might come out when fees have increased or clients are told they cannot do something. This expression detaches you from the firm when the client feels you are a representative of the firm that should be arguing their case.
Why: Your client probably wants a logical explanation why this change has been made. You are ducking the question and responsibility.
Instead: See this from the client’s perspective. If fees went up because the firm installed a new technology platform, how does the client benefit. If it is a personal issue, meet with your manager, present the client’s case and bring the decision back to them. The client will know you at least tried to represent their interests.
7. It’s my way or the highway. The expression brings a smile to your face because it illiterates. If you have young children and have tried the “because I said so” approach, you know how that works out. Are you prepared to lose this client if they do not comply?
Why: The client might not understand why things need to be done a certain way. They need an explanation. You might follow an investment procedure including recommending certain stocks, mutual funds or ETFs. If you work with only a few, it is easier to stay on top of them. If your future client only wants to trade options, you might not be the right advisor for them.
Instead: Explain your process. Your new client needs to “buy into” your approach, but they need compelling reasons.
8. I want all your money. This might be your ultimate goal, but it is unlikely the prospect will sever all ties they have to other firms and advisors until they are comfortable with you. If you voice this requirement, you are giving them an ultimatum. If the choice is all or none, you might get none.
Why: Prospects might have existing relationships with other advisors. They have some money coming available and can transfer over funds without disrupting existing relationships. They probably want to “try you out” for a while, determining if you deliver the level of service you talk about.
Instead: Asking for money is both an art and a science. You need enough new assets to “show what you can do” yet not ask for too much, creating a situation that would disrupt other relationships. The prospect might be unwilling to do that.
9. You would not believe some of the nut jobs I get as clients. Working with the public requires “people skills.” There are all sorts of personalities out there. Ideally you build up a clientele of nice people, clients who trust you and you can relate to easily. By speaking disparagingly about other clients, you put people on edge.
Why: Your prospect or client might think you classify them as a “nut job” too, but do not say it to their face. They think you talk about them when their back is turned.
Instead: Position confidentiality as a client benefit. You don’t talk about your clients. This means the “nut jobs” comment never comes up.
10. If you leave, there is no coming back. Sometimes advisors lose clients. If you tell them the door is firmly closed, you have upped the stakes. This can turn a client departure into an adversarial situation.
Why: You don’t want your client to imagine a fault and sue you. You don’t want them to be receptive to their new advisor’s 20/20 hindsight, explaining why you should have anticipated the market decline. You want to part on good terms.
Instead: A New York advisor shared a great approach. Call the departed client a few weeks later to confirm “everything” worked out as they hoped. The grass on the other side might not have been as green as they hoped. They might be reluctant to admit leaving was a mistake, but you are meeting them halfway.
We need to be careful what we say. Many people have long memories.
Bryce Sanders is president of Perceptive Business Solutions. He provides high-net-worth clients with acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor,” is available on Amazon.