Consumer OutcomeCLARITY
Practitioner approachIn order to plan we need something to plan for.Establishing needs and objectives is nothing new, but under this outcome, objectives must be based on human outcomes rather than financial ones.Personal to our client and not generic.Specific, measurable, assignable, realistic and time bound.Examples could be …Investing cash to maintain its value against inflation might be something a client wants to do but why? To invest cash to provide a pot of money to bridge a shortfall between pension income and expenditure gives us a ‘smart’ objective when we add numbers and a timeframe.Or, a client wanting a pension review will simply get a product comparison unless it’s established why they have a pension in the first place.Establishing a ‘smart’ objective brings CLARITY over what the client is trying to achieve and helps us align client and planner behind the same goal.This can be quite a challenge for clients as many will not yet have thought about giving purpose to their money.Practitioner skillCoaching“I’m much clearer about my personal ambitions”
Consumer OutcomeCONNECTION
Practitioner approachOnce we have CLARITY, something to plan for, we need to know what resources are available to our client to help them achieve their plan.The good old fact finding exercise but slightly different.Perhaps focus on what we don’t know yet. This could include:“I now understand my current financial position”
- Assets
- Liabilities
- Cash
- Pensions
- Investments
- Income and expenditure
- Wills
- Power of Attorney
- Gifts / Trusts
- Attitude to Risk
- Future legacies
- And more …
Consumer OutcomeCHOICE
Practitioner approachOnce we have established what our client is looking to achieve and the resources they have available to them, we can model various scenarios which will result in us having a plan to work towards.Cashflow modelling can be a useful tool to obtain information from a client not yet divulged. For some clients, seeing their future brought to life through the modelling of various scenarios creates engagement and opens up conversations.It gives a clear vision of the future and choice over things such as retirement, standard of living, buckets lists …It’s also important to challenge your clients about certain scenarios … can things be done better, sooner, can quality of life be improved.Possible examples …A client may wish to retire at 60 on an income of £30,000 per annum. Can they retire at 58? If they work until 62, can they retire on £35,000?A client may have a wish list of experiences they are not sure they can afford. Including these experiences in the model can potentially make them a reality. We know a lot of clients need permission to spend money.This outcome gives the client CHOICE that can significantly enhance their life.Practitioner skillCashflow and scenario modelling“I have evidence to choose what I do next”
Consumer OutcomeCONTROL
Practitioner approachOnce a plan has been agreed, the next outcome is to improve the client’s chances of success.If we consider CONNECTION above, are all the resources available to the client in a good place to give the client a good chance of achieving their plan? What can we do to help the client improve their chances of success?This all helps to position the financial advice that we recommend.An example could be …If we believe a client should transfer their pension, without a link to a wider plan, we are just providing a product comparison.If linked to a plan, our advice changes to … ‘in order to improve the client’s chances of success, we recommend they do a, b and c. The link to the plan gives advice meaning.If we expand the concept of improving a client’s chances of success out to all the resources identified earlier, we give ourselves a list of advice that we believe should be implemented for every client.This precision also helps the client feel in CONTROL of their plan knowing everything is in the right place.Practitioner skillRegulated financial advice“I am now in control of achieving my ambitions”
Consumer OutcomeCONFIDENCE
Practitioner approachRegularly reviewing the plan is an essential part of advice. It is the long term relationship that we build with our clients that gives them CONFIDENCE that they are on track to achieve their ambitions.The review re-visits CLARITY, CONNECTION, CHOICE and CONTROL. Is the client still on track with the long term plan or has it changed? Does the client still have the same resource to achieve the plan?Once we know this we can use modelling to further improve the client’s chances of success.Practitioner skillRelationship skills to look after a client for life“My plan can evolve with my circumstances”