All financial advisers have faced challenging client interactions at one time or another. Whether the financial advice hasn’t yielded the results the client was expecting or you’ve taken too long to get documents out, clients can get tricky from time to time.
Unreasonable clients can present a potential psychological hazard in the workplace that employers now have a legal duty to manage, under the Work Health and Safety Act.
The Wealth Designers senior financial adviser Dawn Thomas admits that clients have been tricky when they try and push for particularly aggressive investment strategies.
“As advisers, our philosophy is to achieve client goals with the least risk necessary, but some clients feel underwhelmed by what they perceive to be a conservative approach, even when their partner doesn’t share the same view,” Thomas tells Professional Planner.
In this case, she revisits their goals, explores what has changed and outlines the risks involved in a more aggressive strategy.
Other tricky situations are when one partner seeks advice, but the other feels overly confident about financial planning.
“This dynamic can create tension, especially if one partner belittles the other’s desire for support,” she says.
While involving both parties usually leads to better outcomes, there are times when it’s more practical to work with just one partner.
“Respecting their decision while offering tailored, meaningful advice often demonstrates the value of financial planning, even if the journey isn’t entirely smooth,” Thomas says.
Other times, clients can become agitated if they aren’t not fully engaged in the advice process, don’t understand something or you haven’t met their expectations. Identifying which of these is the issue is key, Fiducian financial adviser Renee Hush says.
To ensure clients are fully engaged, she starts each initial meeting by asking clients what brings them in to see her for. While this approach can send the meeting down a different path, going with your own agenda can mean the client isn’t fully engaged in the process.
“Taking the time at the initial meeting to let the client unload everything they want to know or address and working through this with them, allows them to unload specific issues and feel like they have some semblance of control in what a scary and overwhelming situation can be,” Hush says.
“Once they have done this, they tend to take a breath and relax and let you guide the meeting as required.”
No matter what the challenge might be, the best place to start is by expressing a little empathy for the situation, says Link Wealth Group managing director Steve Sloane.
A lot of the time, clients just want to know you’re on their side, and genuinely care about solving the problem. “Aim to be clear and straightforward, avoiding jargon or over-complicating things,” Sloane says.
“When clients fully understand what’s happening and why, it often helps calm their concerns.”
Next, guide the conversation toward what can be done next to address their concerns and reminding clients of the big picture is important.
“Show the client that there’s a clear plan in place not only reassures clients but also strengthens their confidence in the process,” Sloane says.
“In the end, these situations are an opportunity to build trust and build a stronger client relationship.”
Going back to the basics of seeking understand and then to be understood is a philosophy that works well for Hayes & Co Insurance financial adviser and risk specialist Trish Gregory.
When a client expresses frustration, has a complaint or has unrealistic expectations, she firstly recaps on the discussion leading up to the advice to see if she might have gone wrong.
Understand whether the client had an issue with the actual advice, the relationship with the adviser, the timeliness, the advice process, communication or something else is a good start.
“I ask open-ended questions and give them time to express themselves clearly so I can truly understand what the underlying cause of the challenge is,” Gregory says.
“I ask them detailed clarifying questions about the advice and the process to ensure there isn’t any gap in understanding which can often be the biggest issue.”
Most of the time when she is confronted by a challenging client, Gregory says the issue is they don’t fully understand “the why behind the what”.
“By taking the time to understand and then educate in a way that makes sense for them, we can have a better outcome,” Gregory says.
Other advisers fall back on their systems and procedures to avoid run-ins with clients. Pursue Wealth provisional financial adviser Alex Strempel says human complexities, like balancing blended families, small businesses, and infrequent cash flow can often present challenging client situations.
The firm runs an in-depth discovery process, organises regular meetings, creates a structured roadmap and celebrates wins, which helps avoid challenging client situations.