The personal side of financial planning

A reflection by Bruce Fleming CFP®, Private Wealth Management, and Financial Planner of the Year 2016.

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(L to R): Godfrey Nti (FPI CEO), Bruce Fleming, CFP® (2016 FPI Financial Planner of the Year), Adv. Sankie Morata, CFP® (FPI Chairperson) and Laura du Preez, the editor of Personal Finance.

The days of commission-driven product selling in the financial planning industry, where clients’ needs, wants and requirements were secondary, is thankfully something of the past.

Legislation has had something to do with it, but I feel professional financial planners and Certified Financial Planners (CFP®s) in particular put clients at the centre of all recommendations. All CFP®s are very well qualified and can give very good financial advice, but what sets good financial planners apart from exceptional financial planners is the personal attention the financial planner gives to his or her clients.

For a financial planner to be exceptional, he or she needs to have the technical expertise to ensure that the client’s financial plan will stand up to technical scrutiny, but more than that, to understand the client and what makes him or her happy or fearful.

I always use the analogy of building a house, if the foundations are strong, the house will never fall down.

Right from the beginning of their relationship with clients, financial planners need to understand what makes the client “tick”. For financial planners to do a comprehensive financial plan, clients need to share information with financial planners that they wouldn’t share with their family or friends, such as how much they earn, how much they spend, how much they save and what capital they have. This they do at a very early stage of the relationship with their financial planner. This is very personal information that takes a lot of trust from the client’s perspective right at the beginning. Financial planners, therefore, need to appreciate this.

Bruce Fleming CFP® – Private Wealth Management, and Financial Planner of the Year 2016

Once the financial planner has all the client’s financial information, it is vitally important that they get to know the client’s personal circumstances, such as how they are married, how many children they have, what the work schedule looks like and indeed what they enjoy doing in their downtime. This enables financial planners to get to know their clients on a personal level as well. This is the personal side of financial planning that will ensure a long-term relationship with clients. This will immediately elevate the relationship to another level as not only do you get to know the client on a business level, but you get to know them on a very personal level too.

I always use the analogy of building a house, if the foundations are strong, the house will never fall down.

The foundations of the relationship upfront will ensure a very strong personal relationship going forward and will help the financial planner in all future engagements with the client in terms of behavioural finance, which as far as a personal relationship with the client is concerned, becomes imperative.

Like building a house, you need to look after it. All future interactions with clients will be built on the relationship you build upfront. For the financial plan to remain on track, you need to harness the relationship. This means that if there are any changes in the client’s circumstances outside of any formal meetings, the client’s first port of call will be their financial planner.

Any concerns they may have in terms of behavioural finance means they will not make irrational decisions on their own but will contact their financial planner, who should by now have become more than just a financial planner, but also a financial coach.

For a financial planner to be exceptional, he or she needs to have the technical expertise to ensure that the client’s financial plan will stand up to technical scrutiny, but more than that, to understand the client and what makes him or her happy or fearful.

Winning Financial Planner of the Year 2016

The Financial Planner of the Year Award is not an easy award to win. You are judged by your industry colleagues on your financial planning processes, knowledge and most importantly how you treat your clients. This makes winning the award even more special. The award also elevates you in the eyes of the industry and the consumer as a whole.

If you are passionate about our industry and about financial planning it is definitely something I would recommend all qualified CFP® financial planners enter.

Article courtesy of Cover Publications.