Using Asset-Map in the Client-Discovery Process (David Leo, Advisor Perspectives)
[This article was originally published on Advisor Perspectives]
Advisory practices must “lead with advice”. The Asset-Map process and its toolset is a force for robust conversations that provides the basis for your advice. This is the essence of the process of working with prospects as well as with clients.
Whether your prospect and you are determining fit, gathering the information you need to develop a plan, determining what portfolios should look like, or understanding the prospect’s wants, needs, wounds, feelings, and emotions, these conversations are required to provide advice.
Financial Advisor Discovery Process & Questions
In previous articles and in my book, The Financial Advisor’s Success Manual, I outlined an approach to the discovery process. My approach calls for a three-meeting process:
Meeting #1 (Consultation): Build rapport and trust with a prospect.
Show you care about who they and their family are. The prospects should be speaking 80% of the time; you are listening and taking notes so that you can learn as much about the prospect as possible. This is not a presentation meeting. You are focused on asking and answering questions. You have no prescriptions, recommendations, or opinions until you fully understand the prospect.
Uncover their needs, wants, unfulfilled desires, and concerns.
Emotionally and economically qualify the prospect.
Create interest to get the prospect ready to select you as their financial advisor.
Meeting 1 is about the right brain, getting to know who the client really is, their values, beliefs, priorities, and hopes and dreams. Your goals are to have the prospect grow in their know, like, and trust of you and gain their commitment to the next meeting.
Meeting #2: Gain a complete understanding of the prospect’s current financial situation and experiences.
The goal is to uncover technical needs, review their goals, and continue to increase their level of trust and likability in you that was built in Meeting 1 so you are moving closer to a commitment to doing business together.
The objective of the data gathering here is to be able to develop a complete diagnostic on the prospect’s current situation by uncovering technical needs based on their desired lifestyles, now and in the future, and continue to increase their level of congruence so when the time to take action is here, they will say yes.
Meeting #3: Discuss your strategy and plan for the prospects and their family.
This is the game plan you are offering to gain commitment to implementation. Your plan assumes the sale as a prelude to the question, “Are they ready to start working together?” Your plan is general enough so the prospects cannot effectively implement it themselves, but specific enough to define the actions they need to take with you.
Show how you are going to help prospects achieve their goals.
Shape your presentation around the prospect’s communication, buying style, and personality.
Use emotional tie-ins and be prepared to handle objections so the prospect takes action with you because they are confident you have described a solid plan for their future financial well-being.
There should be an agenda, or, if you prefer, a “discovery meeting plan” for those meetings. Personalize and share that plan with the prospect not only to set expectations and show you are organized and structured, but more importantly, so they can add any topics they would like to discuss in addition to what your process is. Personalization and empathy are critical.
Financial Advisor Discovery Objectives
Keys to this process are creating a strong emotional connection with both partners through your questions and responses. A questionnaire is also a part of the process. The goal of each meeting is to get the prospects to agree to the next meeting. The goal of the third meeting is to convert the prospects to clients.
In an article, Active Listening, Peter M. Beaumont gave four reasons for why listening builds relationships:
We can gain information – If we listen, really listen; we can learn things about the person, their aspirations, their fears, their business, and what we may be able to help them with.
We build trust – When we give our full attention to people expressing thoughts and experiences that are important to them, they are likely to see us as a person who cares about them. This builds trust.
We increase our accuracy – When we listen properly, we have a better recollection of important facts and issues.
We build a relationship – When we listen properly to the other person’s point of view a real conversation can ensue. When this genuine exchange takes place, we naturally form a relationship.
As always, relationships are based on “know, like, and trust.” These are goals for everyone with whom we meet: prospect, client, friend, family member, colleague, etc. It has been said, “A person who is nice to you but rude to the waiter is not a nice person. (This is very important. Pay attention. It never fails.)”
Using Asset-Map in the Discovery Process
While I would adjust the three-meeting discovery process if you decide to use Asset-Map in your business, begin with the end in mind. The “end” in this case it is to convert the prospects to clients. We want to “report” the findings of our first two meetings by discussing our plan for the prospect’s financial well-being, for now and for the future. We’ll come back to meeting three later.
In meeting one, we’ll use a data-gathering approach to detail our starting Asset-Map for the prospect. The asset map will illustrate family makeup, income sources, types of family assets, and insurances for each spouse/partner. I suggest having a standard outline of what you would like to address in your third meeting when you present your findings, plan, and next steps, and seek agreement to work with you.
If you have had an initial telephone conversation with the prospect, you can prepare a starting Asset-Map with the limited information you know in advance of the meeting, e.g., family names, where the couple is employed, and some basic asset information they have volunteered.
In discovery, understand as much of their lives as you can, especially their emotions in all the areas you discuss.
Family members;
Their history;
Current working environments and other activities in which the couple or family members are involved;
Current lifestyle;
How they spend their time when not working, their likes and dislikes;
Their hopes and concerns for their future selves and their family members;
An overview of their financial situation and experiences; and
What their expectations are from their financial advisor.
Toward the end of the meeting, you should summarize your understanding of your discovery. After that, briefly review the process you have gone through and are going through to ensure common understanding and that there remains a solid connection between the prospects and yourself. Briefly outline your process and the types of services you provide your clients.
In all phases of this meeting, you will be seeking feedback to ensure your understanding of what the prospective clients are saying. Where appropriate, seek feedback on the process and services you discuss, always seeking emotional connection from both parties of a couple.
In meeting two, reestablish rapport and review your findings from the first meeting by presenting a partial Asset-Map. The Asset-Map will include all the information you have as appropriate and placeholders for information you will want to gather in this meeting.
From the above sample partially completed Asset-Map, we show:
All family members important to the prospects, dependents, family, and other professionals;
Where the principals are employed;
They are planning to send their three children to college; and
That they have a house in Cedar Rapids showing estimated value from Zillow.
At this point we do not have data on:
Incomes;
Assets;
Insurance coverage;
Debt;
Business interest; or
Other potential incomes or assets.
We do however have placeholder “tiles” for each piece of data we would like to gather so we can begin to develop a plan for the Johnson family.
We now have an agenda for meeting two. Once we have reestablished rapport and reviewed our findings from the first meeting, focusing heavily on their wants, needs, and wounds, we can move into more detailed financial data gathering. It is most important in every contact, and most important with this one to ensure we continue to bond and establish the know, like, and trust factors by focusing on the emotional aspects of their desires for their future financial well-being.
You can then use the Asset-Map and mark it up, tile by tile, so you can enter the data wherever you need it. You can cross out and add tiles as required manually for later input. If you prefer, you can do this online to show the flexibility and ease of use of Asset-Map. The conversational, working session is no longer an inquisition, it is an interactive, cooperative venture between your prospect and yourself. This is another opportunity to continue the bonding relationship that comes from working together that will continue through meeting three and beyond.
You already have an entry point for discussing some of the “beyonds”. For example, you know who the mothers of the principals are as well as their CPA and Trust and Estate Attorney. While we want to keep our eye on the prospects themselves, we already have some future potential prospects identified.
In meeting three, you will, as always, reestablish rapport and review your findings from the second meeting by presenting a more complete Asset-Map. The Asset-Map will include all the information you have as appropriate and perhaps a few placeholders for information you want to discuss further.
After your personal greeting and brief conversation, I suggest a quick review of the process you have been going through the last several weeks and today, just to reset and review. For example,
In our first meeting our goal was to get organized by understanding where you are right now in your lives, your current situation, how you got to where you are today, your story, and where you are trying to get in the future, what you want your future story to be.
We believe we understand your current lifestyle and the lifestyle you want to enjoy going forward. Though we’ll show you an updated picture of today’s environment, we want to know if you are comfortable with our discussions to date?
In our second meeting we focused on the numbers, that is, your current net worth and assets, liquid and non-liquid, income sources, and other financial elements so we could analyze your situation and future desires so we can develop a plan to help you move toward your desired future lifestyle.
We illustrated a draft based on initial data and gathered the necessary data to get a more detailed understanding of your financial situation. Did that reflect what you said?
In our meeting today, we will show you a more fully completed draft of your map, make any required changes, and discuss some initial findings. We will begin to discuss options. We understand these are point in time numbers and that’s why we regularly review the plan as part of our process.
In this review and report meeting we will address everything we discussed to date, validate our information, present a high-level plan and recommendations, and outline potential next steps to determine if you’d like to move forward with us as your advisor team.
With your agreement, we have properly defined your current and desired future lifestyle so we can put final recommendations in place and then begin to implement the plan.
Following a discussion and hopefully answering all your questions you will be able to decide to move ahead working with us. Assuming you do, we begin the detail work on our specific financial advice. Here are some of the items we will discuss and arrange:
Implementing, changing, or advising on any financial products or investments. This includes investments, asset allocation, portfolio construction, risk profiling, rebalancing, retirement plans, stocks, bonds, funds, trusts, tax implications, and anything that deals with the dollars that fund your desired life whether savings or spending.
Implementing, changing, or advising on protection needs, e.g., life, critical illness, medical, health, etc.
Arranging actions required to implement your legacy and estate plans.
Arranging actions required for managing taxes.
Following is a summary of the information you gathered to gain concurrence including:
Family – their most important relationships;
Life and family backgrounds, goals, hopes, interests, and concerns;
Financial values and current financial situation;
Desired client services;
Other advisors; and
Possibly a review of the prospect’s current portfolio and your thoughts if appropriate.
Summary Report
You may want to develop a template for a sample report as an “initial wealth management plan.” It would address the above in a written document for the prospect as a leave behind. It would address the meetings you have had, your findings, both in a list form and in Asset-Map form if appropriate.
If the advisor wants to go a step further and analyze the prospect’s current portfolio with respect to asset allocation, equity, and fixed income makeup, by geography, industry, etc. the plan would include illustrations. You might also include high-level key findings and a set of illustrations to outline your high-level portfolio recommendations and changes as well as an overview of how you do your work.
Finally, a template plan might include an appendix with a sample of your role and approach as the client’s personal chief financial officer, your wealth management approach, and your process. All the elements of the plan are part of what I share in my coaching work.
Since the focus should be on the prospect, not the advisor, the advisory philosophy and approaches are at the end of the plan. Hopefully, in your first meeting you have asked for a few minutes to discuss your process and the deliverables you provide your clients.
As a final note, the summary of your findings in list form in the sample plan may take 6 to 8 pages depending on how you display it and spacing characteristics. The point of Asset-Map is the same information is displayed in a single page that is digestible and all in context of the prospect’s entire financial life.
David Leo is Founder of Street Smart Research Group LLC. He is an author, speaker, coach, consultant, and trainer to financial professionals. David is an experienced business manager who works solely with Financial Advisors, Planners and firms who want to organize, structure & grow their businesses by attracting, servicing, and retaining affluent clients.
If you would like additional details or have any questions about his articles or an interest in coaching schedule a free 45 Minute Strategy Session @ https://calendly.com/davidileo or contact him @ David@CoachDavidLeo.com. Call 212-598-4229 (Office) or 917-379-1249 (Cell) and visit @ www.CoachDavidLeo.com.