Building a Trusting Relationship

Mitch Anthony

As an advisor, if you know little to nothing about what is happening or will be happening in the life of your client, then the trust level of that client is hinged exclusively on your performance. In this scenario, as soon as performance dips, the trust level dips along with it. If, however, the trust level is built on your knowledge and understanding of that client––as well as investment performance––the fluctuation and temperament of trust is mitigated.

If performance is below par, your client may contemplate changing advisors. Consequently, your client is now faced with the prospect of working with someone who does not understand her life as well as you do. Trust is at the core of why a client is willing to give you access to any or all of her assets.

When seeking to build a trust-based relationship with clients, advisors would do well to analyze the questions they are asking clients in order to ascertain whether their inquiry process is designed to build trust. The following are four types of questions (each with an unique objective) that advisors can ask their clients:

1. Data questions. These are designed to gather information (e.g., most questions on a financial questionnaire, including the summary of assets and where invested).
2. Intuitive questions. These questions allow the advisor to read between the lines (e.g., “If you were to teach one financial lesson to your children or grandchildren, what would that lesson be?”). These are the questions that help you “hear” what your client is thinking but not saying.
3. Socratic questions. These are designed to stimulate necessary thought (e.g., “If you had the money, what would you do differently?”).
4. Biographical questions. These are designed to build understanding of the client’s life history and to strengthen the relationship between advisor and client (e.g., “Tell me about your life’s work” or “Tell me about your father. What kind of work did he do?”).

Trust is the irreplaceable cornerstone of a lasting relationship. If we look at trust-building as the goal, then all our processes should be contributing toward that goal––most significantly, the discovery process. Clients learn to trust us in part through the questions we ask about them.

Adapted from Your Clients for Life by Mitch Anthony (©2008 Mitch Anthony). Available at http://mitchanthony.com/BOOK_Clients_4_Life.html.

Mitch Anthony is the founder and president of Advisor Insights Inc. and The Financial Life Planning Institute, training companies serving advisors and the financial services industry. He is the author of several books for advisors including the StorySelling for Financial Advisors. Mitch’s newest book, The Cash in the Hat is available from Insights Press. (http://mitchanthony.com/BOOK_Cash_in_the_Hat.html).  Mitch Anthony is a contributing editor for Research magazine and his column “Financial Life Planning” appears in Financial Advisor magazine. He has been a named a “Mover & Shaker” by Financial Planning magazine and is frequently quoted by the media as an expert on financial life planning.

Contact him at mitch@mitchanthony.com.

© 2008 Mitch Anthony