One of my favorite quotes is, “The truth, the whole truth and nothing but the truth should not be three different things.” It is by Dianna Booher, author of What More Can I Say?

Consider how the following conversation I recently had with an advisor might help you more effectively use the truth to influence your clients to make better choices.

Bob: How was your Thanksgiving?

Bill: Good. And yours?

Bob: My Thanksgiving was really good, but the day after and since then has been very difficult.

Bill: What happened?

Bob: Friday after Thanksgiving, I found out that one of my clients, a 48-year-old and healthy mother of two young children, had a brain aneurism. She’ll be out of work for at least a year and who knows if she’ll ever be the same. That was hard. What made it even harder is the grilling I got from her mother about whether or not I had spoken to her daughter about disability and life insurance. When I told her I had, the grilling continued because she wanted to know if I had been forceful enough about how crucial it is for a working mother to have both of these insurances. I assured her mother that I had strongly advised her daughter to buy these insurances. But her daughter had refused to buy either disability or life insurance because she was superstitious that if she bought them that it would increase the odds of her becoming disabled or dying.

I feel like I did everything I could have done, Bill. What would you have said to her to get her to buy the coverage she really needed to protect herself and her family?

Bill: Yes, it’s challenging when a client is irrational. There’s no guarantee that anything will work all the time, and it sounds like you did a good job trying to convince her to do the right thing. In addition to what you did, I probably would have said something direct and candid like, “I simply can’t allow you to make decisions as important as this based on superstition. That’s fine for a 20-year-old whose brain is not fully developed and is hardwired to make bad decisions. But you’re 48 years old and have to recognize that the statistical probability of dying or becoming disabled is exactly the same with or without insurance. Having this insurance coverage is simply too important for you and your family. I have prepared the documents. Sign here.”

Bob: What if she still refused?

Bill: Yep, that’s a bit tricky. On the one hand, you can lead a horse to water, and adults have to be responsible for the consequences of their choices. That said, from my point of view, it’s a deal-breaker. The evidence that you are truly someone’s advisor is that they follow your advice, right? When someone chooses to not follow the advice, I view that as effectively being fired. Again, there isn’t an absolute right or wrong way to respond in this situation, but a direct, candid approach is usually the best path. Consider this: “We can’t do business together if you are not going to follow my advice. The reason you pay me is for objective advice about what’s best for you and your family. My greatest value to you is the fact that you get advice that is unburdened by emotion or false or limiting beliefs. Tens of thousands of ‘financial professionals’ and ‘wealth managers’ can write plans, sell you products and manage your money. What I do is bigger than that. My commitment to you is to actually hold you accountable to implement the advice because that’s the only way you get the benefit of my advice. If you are going to go against my advice, then you’re going to have to find another advisor … hopefully someone whose advice you will follow and not someone who will just tell you what you want to hear or present options and let you choose whether or not to act. What would you like to do?”

There’s a pretty good chance that most people have never been fired by their advisor because most advisors are so busy puckering up to keep their clients at all costs. So the conversation that follows will be interesting. Don’t be surprised if they do an about-face and implement your advice. I’m sort of a hard-ass on this subject. I believe that an advisor who does not have full conviction about their advice should find another career.

However, if that’s more courage than you can muster at this point, then at least do this: “I’m sorry that you are making a decision that is so blatantly bad for you and your family’s future. As a matter of business practice, my lawyers have prepared a binding legal disclaimer document that you’ll need to sign today. What it basically says is that I have given you specific advice that’s good for you and your family’s future and that you are choosing to ignore the advice. Your signature on this document releases me from any future claims by you or your family regarding this matter. Please sign here.”

For a few hundred dollars, your lawyer will draft this document for you. Your firm may already have a template you can use.
One of the hallmarks of our training and coaching is that we teach you to diplomatically, but directly and candidly, say what you really want to say to people to help them make better decisions about their futures. It seems so simple, right?

Then why don’t more “advisors” communicate more directly with their clients about what needs to be done so they increase the probability of achieving their goals and reduce the risk of events that could derail or delay goal achievement?

According to those of you who have shared your reasons with me, it’s because you are afraid of how your clients will react and, if they react badly, they will stop doing business with you. I suppose that’s a risk, but it’s a bigger risk in your mind than it is in reality.

Perhaps it would be better for your clients and your business if you were less afraid of the tough conversation with clients about what they need to do to increase the probability of achieving their goals and reducing the risk of events that could derail or delay goal achievement. And MUCH more afraid of the more difficult conversations with them and their family should you find yourselves at a place in the future where that bad decision has come back to haunt them, like the example above.

Would you rather have the difficult conversation with the 48-year-old mother about buying the right insurance? Or would you rather have the more difficult conversation with her mother? I agree with grandma. What she’s implying, correctly I believe, is that it’s your job to make sure your clients do what they need to do, not what they want to do, especially when they make irrational excuses for not doing what’s in their own best interest. And if you can’t get that job done, then maybe you shouldn’t be that person’s advisor. It’s a high bar, I know. What do you think? How do you think our industry would be perceived if we all operated at this standard?

It’s not a job requirement that your clients like you. It is a requirement that they trust you and that you ALWAYS tell them what they need to do to increase the probability of achieving their goals and reducing the risk of events that could derail or delay goal achievement. Especially when that’s difficult. Think of yourself like a Hall of Fame coach. Your goal is to help them get the best results, not be their best friend. Be friendly when friendly works. And be prepared to do whatever is necessary when it doesn’t.

You probably don’t ever want to wonder, as you lay your head on your pillow at night, whether your clients are exposed to risks because you lacked the courage to tell the hard truths so they make the best choices, no matter how difficult. Or whether you put your need to keep a client ahead of the client’s need to hear the truth from a professional advisor who cares about them achieving their goals and having adequate protection against the risks to achieving their goals.

Of course, not everyone can handle the truth. My advice is that you build your business with people who want an advisor who tells them the truths they need to hear, not what they want to hear.

A person who cannot handle the truth is definitely NOT an Ideal Client.

To learn more about how Bill and his team can help you be a more direct and candid communicator who helps clients make better decisions, schedule your Business Accelerator Meeting today. 858-558-3200 / www.billbachrach.com