Your clients' most important data is not found on their balance sheets.

    How do you feel about sitting down and filling out loan applications? Financial forms? Applications of any sort? It is a mundane, repetitious, and dreary routine that most people would bypass if they could. Below the surface of the task of filling out the forms lie the emotional objections of revealing private information, being defined by numbers and the possibility of not being considered important enough.
    As a part of his consulting work in the industry, Mitch is often asked to look at the information-gathering forms used by many of the major firms in the industry. What he often finds was best characterized by his friend Scott West who said, "It's like participating in a Bataan Death March of numbers." The fact that some refer to the information-gathering process as "probing" ought to tell us enough. A conversational euphemism that conjures up the image of a latex glove ought to suffice in telling us that maybe the process isn't all that pleasant for the client.
    Mitch once received a call from a firm who had redesigned all their discovery forms and wanted him to critique them for how they might resonate with the client. They sent all their forms to Mitch on a Friday and scheduled a conference call for Monday morning.
    In all their forms Mitch found approximately 100 questions--95 of which were quantitative in nature: What do you have? How much? How long? Where is it? What are your account numbers? The first question that could be characterized as qualitative was, "Which of the following five is your goal?" and gave options like putting a child through college, retirement and buying a second home.
    When the Monday morning call came, Mitch informed them of their ratio of quantitative and qualitative inquiry and then complimented them on their sociological research or clairvoyance--or whatever it was that enabled them to reduce every American's goals to a list of five. He also shared with them the emotional feedback that the imbalance of quantitative inquiry in the process made him feel "like a safety deposit box to which you are trying to find the combination."
    And these inquiry forms were the "new and improved versions" that this firm was using. We can't imagine how much fun the client had with the previous version. To be fair we will concede that the statistical information gathered is important, but our assertion is that it is peripheral in importance when compared to the qualitative information that defines the context of who the client is and what is important to him or her.

Shortchanged By Numbers
    Just as we wouldn't commence a client interview with, "How are you and how much do you have?" neither should we progress into numbers gathering until the proper emotional context has been established for the work we will do.
    There is only so much that the numbers can tell us. They speak only to the material side of the equation. When the popular physicist Brian Greene was asked why he was such a good communicator (unlike his peers), he said, "I don't feel like I understand what I'm doing unless I can form a mental picture of what's going on. If I'm relying on mathematical symbols, I don't feel like I've got the true heart of the science. When it comes to communicating with the public, I take those mental pictures I've developed, strip away the math, and wrap them in a story."
    The true science of financial advice is in the story the client tells. This science is best performed by curious individuals and not by printed applications.
    We must remember that there is a story behind every number you gather, and in many cases, a very important story. We once heard an accountant give a presentation about the fact that he one day realized that there was an important story behind every fact and number on 1040-tax form. Those who harvest those stories will be in better stead with the client because, in the client's mind, the number is not nearly as important as the work and love and sacrifice that produced it.
    Numbers and facts tell us what clients have. They do not tell us how hard they worked, what they had to sacrifice, who has and will benefit, who inspired the dream, hardships overcome, pain and joy in the journey, partnerships formed and broken, amazing breaks and bad fortune navigated in gathering the assets those numbers represent. Behind every success story is a genealogy of events and relationships, one leading into the other, that come together to form incredibly unique biographies. Your job, first and foremost--in respect to the price each client has paid--is to uncover as much of that biographical genealogy as possible.

To The Heart Of The Matter
    Too often the discovery work we do fails to get to the heart of what is really important to the client and what their money really represents. It is virtually impossible to discover these issues by asking only quantitative questions. It takes a dialogue, not a questionnaire, to uncover what means the most to your clients. Of course, you can approach planning like a financial advisor who once told Roy that he "pretty much knows" his clients' goals before they walk into his office. They all want to retire, educate their children, take care of their families in the event of death or disability, save income and estate taxes, etc. His job, he said, is to quantify them; in other words, convert everything to numbers. This approach, we presume, would assume that people with similar assets, ages, and families would get the same "cookie cutter" advice. Perhaps this is the financial planning profession's answer to treating people as if they were numbers!
    Rick Kahler, who practices in Rapid City, South Dakota, tells a story about one of the mistakes he made several years ago before he implemented a discovery process that uncovered the "interior" (qualitative) issues his clients have. At that time he assumed (as many planners do) that the goal of estate planning was to save taxes and reduce probate costs. So he gathered the quantitative data and recommended a solution that was driven purely by numbers-designed to minimize taxes. His client didn't act on his recommendations and, in fact, never returned, until several years later when she learned from a friend that Rick had changed his approach. She confessed to him that the reason she decided to end their relationship was because all he talked about was saving taxes and never bothered to ask her what was really important to her.
    One of Roy's clients, when being interviewed by a financial magazine doing a story about placing trust in financial advisors, was asked what questions a person should ask a planner before hiring one. His answer, "It's not the questions you ask them that matter, it's the questions they ask you."  In explaining his answer he said that other advisors he spoke to confirmed with their questions that they were most interested in his money. Roy, on the other hand, asked questions that demonstrated that he was interested in him and his unique goals.
    A sampling of some of the questions that Roy asks before collecting quantitative data are:
        Tell me about your family when you were growing up.
        What messages about money did you receive from your parents?
        What financial values and/or discussions with your parents continue to affect you today?
        What is your first memory about money?
        When has money caused you pain?
        Describe a joyful memory about money.
        Describe your work history.
        What were some of the financial decisions you made in the past that you regret?
        What were some of the best financial decisions that you have made?
    What are your major beliefs about money?
    What does independence mean to you?
        How do you want to be remembered?
        What part does philanthropy and charitable giving play in your value system?
        How do you feel about passing assets to heirs?
    What would be a desired outcome over the course of these initial meetings?
    During our review three years from now, what will need to have happened between now and then for you to feel that this was one of the best decisions you have ever made?
    Building this kind of a dialogue early in the process will demonstrate to your clients that you are genuinely interested in understanding who they are and helping them align their values with their decisions about money. And when they are asked to gather quantitative data, it will be in the context of fulfilling their dreams and goals. It is when these numbers are not given a living, breathing context that the process of gathering becomes a death march instead of the joyride that discovery can and should be.
    It's really as simple as acknowledging that the human being sitting before you is best measured, not by a story of numbers, but by the number of stories they have to tell.

Roy Diliberto is chairman and founder of RTD Financial Advisors Inc. in Philadelphia. Mitch Anthony is the author of Your Clients For Life, The New Retirementality and the forthcoming Your Clients Story and is a regular keynote speaker at industry events.