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Completing the Picture With Client-Centered Planning

Use these five steps to strengthen and grow your practice beyond just a numbers game.

By Maggie Leyes

Imagine a 1,000-piece jigsaw puzzle spread out before you on your desk. You’re getting ready to put it together. Which is the most important piece to begin with?

If you answered a corner piece, you’d be wrong. The correct answer is the cover.

This is the analogy that Mitch Anthony, founder of Minneapolis-based Financial Life Planning Institute and author of Your Clients for Life, gives to illustrate how most advisors are working—with just the pieces. “If you don’t understand the big picture,” Anthony says, “you don’t understand anything. Until you understand who your client is, where they came from, how they got here, what they’re facing today, you don’t really understand the context of what you’re doing.”

This is the concept behind client-centered planning. Think about it: What major decisions in your own life—who to wed, when to start a family, where to buy a house, what business to go into—were made with just the facts: statistics, pros and cons, the financials? Heart and soul go into those life-altering decisions, which also have the largest financial impact on your life. So, shouldn’t a sound financial plan combine those elements, too: money as well as heart and soul?

A resounding yes comes from Barbara Culver, CLU, ChFC, CFP, of Resonate Inc., coauthor of Getting to the Heart of the Matter. Financial advisors have been taught to create financial plans to care for the physical, she says. And that is no longer enough. For some time this Cincinnati AIFA member had noticed that her clients spent the majority of their time in her office talking about personal goals and feelings related to money rather than the actual money itself. Products and portfolios were taking a back seat to values and dreams. Clients, she saw, wanted to talk about what was important to them in life. “I realized that we should be talking about this by design, not default,” she says.

“Until you understand who your client is, where they came from, how they got here, what they're facing today, you don't really understand the context of what you're doing.”
—Mitch Anthony

So Culver’s planning now involves what she calls above-the-line planning and below-the-line planning. Below-the-line planning includes the more traditional aspects such as products, strategies and techniques. Above-the-line planning includes the person’s values, beliefs and life experiences. “It is impossible to make wise decisions about below-the-line items unless we are including above-the-line items that have contributed to what it is they are now trying to accomplish by coming to see me,” she says.

What it is
You may have had these clients sitting before you: the wealthy widow living like a pauper; the retiree who is financially set, but thinks retirement is not all it’s cracked up to be; the middle-aged couple who could never get it together to save for their children’s college education. These people arrived where they are in their financial lives not only because of money, but also because of how they grew up, matured—or didn’t, and what messages they received about money.

“We all are made up of many different facets, not only financial and physical, but emotional and psychological and spiritual as well, and all those facets are inextricably melded to make us who we are,” says Teresa Cherry, CPA, CFP, CM&A, of The Family Wealth Collective in Chicago. An advisor using client-centered planning attempts to take all those facets into account and create a plan that not only addresses them, but also uses them to the client’s advantage.

Anthony gives it a visual spin: See yourself as a personal financial concierge or chief financial officer in your client’s life. “It would be incumbent on me if I were your chief financial officer to know what’s going on in your world because everything that’s happening in your life, every change, every concern, every opportunity, every challenge has financial issues attached to it,” he says. “And what I can do is help you examine those financial issues and then make recommendations strategically on what we might do, on what products, services and process we might employ to help you through that. But I can’t do that without being attached to the larger context that drives that—and that larger context is your life.”

What it's not
“It’s become fashionable [for advisors] to say their methodology is client-centered. But what’s really the difference between client-centered planning and needs-based selling?” asks Bill Bachrach of Bachrach & Associates, who left advising to make a career out of helping other advisors move toward client-centered planning through his Values-Based Selling methodology. Many advisors, he says, think they’re doing client-centered planning: “They will tell you, ‘We focus on the clients; we focus on the client’s needs; we find out what their goals are; we find out what their dreams are.’ Well, that’s nothing new. That’s been done for a long, long time. So have we just changed the title or are we doing something different?” Instead, client-centered planning begins with the here and now—what got the client to this point in his financial life.

“Asking people what their goals are is just one piece of that context,” says Anthony, “and that’s really not true context because that’s going forward, and you don’t know what’s going to happen tomorrow. Context is based in reality, what’s happening now. That’s the real question.”

That does not negate the importance of addressing a client’s goals and dreams, but to have true client-centered planning, you need a truthful, honest process that identifies where the client is—and why, and where he wishes to go—and why. Only then can you create a written plan that addresses all those areas—financial and nonfinancial—in a format that the client feels comfortable implementing. So let’s take a look at the major steps of moving to a true client-centered practice.

1. Build a resource team.
Are you hesitant to do this more comprehensive planning because you feel you will be stepping out of your area of expertise? That’s the case with many advisors. Because this type of planning deals with “soft,” unquantifiable ideas and issues, you need to call in reinforcements.

You may already be referring your clients to other specialists, such as accountants and lawyers, but with client-centered planning, you also need to expand your team of experts to include nontraditional as well as nonfinancial specialists. This will allow you to address your client’s needs without stepping into territory that makes you uncomfortable.

“I don’t try to do it all,” says Culver. “Advisors need to do what brings them the greatest fulfillment—doing whatever aspect of the process that is their gift. They need to identify their gift and skill set, and then surround themselves with teammates who fill in missing parts.”

For Culver that means professionals such as psychologists, clergy, eldercare specialists and hospice professionals. She also doesn’t restrict her network to locals; she searches around the country to find “virtual” team members. That way, she offers “the best skill sets required to meet the client’s agenda.”

Cherry, who specializes in wealthy, family-business owners, doesn’t go quite that far, and tends to be “more quantitative.” She calls in a team of professionals such as management consultants, valuation experts, estate-planning attorneys, CPAs and money managers at the beginning of the process (albeit after the client signs on and goes through the initial meetings). This way, she is able to provide a united set of recommendations to the client, while eliminating two negatives. On many occasions with traditional planning, says Cherry, a client is left ferrying messages among professionals, who may not know each other, thereby risking information—perhaps important information—getting lost in the translation. Also, if each professional is giving individual recommendations to the client, there is often overlap and information that “falls through the cracks.”

2. Develop a clear client profile—and stick to it.
Advisors at the top of their game already practice this step—understanding its inherent importance to their success. But with client-centered planning, it becomes even more critical. According to Bachrach, you must adhere to a strict client profile, which is based not only on financial factors, but also on personality. “You can’t allow difficult clients, no matter how wealthy, to distract you from serving the rest of your clientele,” he says.


This also lets you winnow your clientele. Being truly client-centered means having a smaller clientele. Bachrach, a member of NAIFA-San Diego, puts the number between 75 and 125, although that number can rise to 200 with the proper support staff and systems in place. “Do the math,” he says. “There is no way you can personally assist each client if you have hundreds or even thousands of clients on your books.”

Cherry uses her initial meeting with clients to not only find out more about them, but to size them up and see if they are the type of people she would like to work with. This, of course, goes on silently, behind the scenes. “If I’m not comfortable, I can pass. It is very important for any advisor to think about his ideal client profile and only work with those they are comfortable with,” she confirms.

Remember, you are not always the one doing the choosing. Clients will also self-select out of this type of planning. Culver uses the initial meeting to have prospects vet her as well. In addition, she sends them off with instructions to do an ethical will, with questions to help them get started. This further weeds out prospects who may not be right or ready for the process. While many advisors are loath to reject a prospect, Culver sees it in a different way. “I only want to work with people that want to work with me. If any client chooses to leave, that’s the right thing,” she says.


Here is a sampling of questions Barbara Culver, CLU, ChFC, CFP, uses to help clients open up about the “softer” issues surrounding their finances.

  • What is the purpose of money in your life?
    Is money an excuse for doing something in your life?
  • Is it an excuse for not doing something in your life?
    What are some of the highest uses of your time or talent?
  • What lessons have you learned from not having it?
    What are your family’s assets?
  • Where do you want your family to be in 50 years?
    What are the universal principles that hold your family together?

3. Ask a new set of questions.
This in no way implies you should set aside the factfinder you use to get all the necessary financial data from your client. Instead, you need to add to that different questions that expand your understanding of the circumstances surrounding the client’s financial situation. Your questions need to elicit not only financial facts, but who your client is as a person: how he grew up, his attitudes toward money, what his current concerns are, what his dreams are.

These new questions need to be open-ended to make the prospect think about how money influences life decisions, and how those decisions influence money. Anthony suggests questions such as, “What’s happening in your life right now that could have an impact on your financial future?” or “What are your biggest concerns right now?” And Culver suggests, “What is the most important life lesson you have learned that you want to share with your children (or grandchildren)?” (See box)

4. Work with both hard and soft information.
We hear a lot about right brain/left brain. But what does that really mean, and is it important? The left brain does the analysis, the math; it sorts out and makes sense of the “hard,” quantitative data. This is where you, as an advisor, excel, and is probably why you chose this field. Decisions, however, are made with the right brain, says Anthony, the intuitive side, which determines if trust has been established in the relationship. It is also the side that connects with the “soft,” qualitative, values-based issues. You need to address and work with both those sides in client-centered planning.

Before even starting on the formal plan, Cherry structures what she calls an implementation list. With it she finds out the most important issue that needs to be addressed. “Sometimes it’s personal; sometimes it’s business; often, it’s interwoven,” she says. By this point she has “gone through mountains of documents, gathered lots and lots of numbers, and gotten the hard-core facts of where they really stand.” That’s when she schedules another meeting to ask questions and figure out where the “holes” are in their financial situation. This is also the time she asks clients to put together an ethical will or value statement that describes what they want to do with their wealth beyond purely financial goals.

When you are working with wealthy or older clients, what you want to do, says Culver, is have them “define and describe what they want to preserve for their family beyond their ‘stuff.’ Ask them to think about what will anchor their family, no matter what befalls them in the future.” This is where you really start to connect with clients. While passing money on to their children and grandchildren is important, older clients want to pass along their values-based legacy, not just their financial legacy.

5. Design the plan and follow through.
This is where your technical prowess comes in. This is the part you know about—what you went into business to do. But you are not home free. Just because you think you know about this part doesn’t mean you are doing it correctly, warns Bachrach, who authored Values-Based Selling. “Asset allocation is not client-centered planning. Taking care of a client’s insurance needs is not client-centered planning. That’s a partial plan,” he says. “To truly be a client-centered financial planner, you need to create a written plan for your client.”

He has a second warning for you as well: Client-centered planning does not mean the client is always right. It’s the difference between accountability and service. “In a service culture, the customer is always right. In an accountability culture, the client is told the truth—whether that’s what they want to hear or not,” he says. “That’s a big thing, because a lot of people think that if it’s client-centered, the client is always right; you give the client what they want. That’s OK in a department store, but if your client wants you to show them a certain product—an insurance product or investment program—and it’s not the right thing for them, then it is your job to say, ‘That’s not the right thing for you.’”

And his third lesson: It’s not about the fee. You can charge a fee to create the plan or get paid on its implementation—either is fine. The critical issue is that you get buy-in from the prospect: commitment to the plan. You need to say to your client, “There is no point in me being engaged by you to write a plan you are not going to implement. Are you serious about implementing the plan? You don’t get value from an unimplemented plan.” That, he says, is your bottom line for your prospects.

For resources on the topic, including the books, classes and programs offered by those covered in this article, go to Client Centered Resources.


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