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Can I be straight with you? What most financial planners claim about the importance of financial goals is totally wrong.
It’s overly simplified, it’s just a marketing-term, or interpreted the wrong way.
Over the last 17 years I have been in the industry, I’ve served hundreds of people, had 1,000+ client-conversations, and I’ve experienced firsthand the (un)importance of financial goals.
And a lot of stuff that planners say or write about financial goals … it just isn’t true.
The irony?
Financial goals matter
Ever read the bestseller “The 7 Habits of Highly Effective People” by Stephen Covey?
Well, you should know that if a book sells over 25 million copies in over 40 languages, it’s safe to say that people start talking – and in case of “The 7 Habits” – it seems like no one can stop talking, not even 20+ years since it first hit the self-help shelves at Barnes & Noble.
Here’s the book in one sentence:
"Think about what is most important to you and see if it is the center around which your life revolves. Don’t worry about efficiency. There is no use being “efficient” if what you are doing lacks meaning or an essential good."
Covey states that effectiveness trumps achievement every day of the week. Achievement is hollow unless what you achieve is actually worthwhile, both in terms of your highest aims and service to others.
That’s why goals are important, according to Covey. In fact, it’s habit #2: Begin with the end in mind.
“Beginning with the end in mind” is really about figuring out what you want.
And here’s the thing … most clients I talk to don’t know what they want. In fact, they don’t have a clue!
They don’t know what they want in life,
They don’t know what they want in work, and
They also don’t know what they want with their finance:
Guess who comes to rescue them?
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The Myth
The thing is that the vast majority 0f financial planners say, think or act in a way that implies most people DO know what they want.
They are under the (fatal) assumption that people actually have financial goals. That people come to their office because of it.
That they step in and say: “Mr. Financial Planner, can you help me realise my financial goals?”
Not so realistic, right?
The truth is that people do not have financial goals
It’s just a fairytale.
Yes, (financial) goals are important. But to whom?
Is it to your client, or to you?
Over the last 16 years I’ve discovered that about 97% of my clients don’t have financial goals. And if you don’t believe me, ask your own clients.
Just ask: “What’s your financial goal?”
In 9 out of 10 cases, you’ll get answers like this:
‘What do you mean?’
‘I don’t know’
‘To win the lottery next week, hahaha’
In reality of course, you’ll get the right answers, if you ask the right questions (I’ll get to that later on)
But the idea of everyone having financial goals is unrealistic.
The good news is, that it’s not so bad. You’ll learn how to deal with it.
The bad news is, that we (as an industry) spend millions of dollars on marketing “the financial goal concept”. You have probably seen it thousands of times (or you might use it yourself):
“We help you to achieve your financial goals”
And there’s a reason why financial planners believe that people have financial goals.
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Helping people to reach their financial goals is what we do for a living. That’s why our financial plan is so important. It’s the roadmap to the financial goal. It’s part of the journey to reach the financial goal.
The only problem?
People don’t want to reach their financial goal.
Because they simply don’t HAVE a financial goal.
That’s why it’s better to focus on the things your clients understand – instead of focusing on things they don’t.
That’s why it’s better to accept we have very little influence on our client’s lack of interest in financial goals. Why? Because they rarely want their thoughts to be influenced at all.
So I hear you think, what DOES work, Ronald?
I can relate.
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Here’s How You Engage People on Financial Goals
Imagine a mountain climber preparing to reach the top of Mount Everest.
He needs to gather the necessary gear, make preparations to prevent him from disaster, work out months before the event, make travel-arrangements, hire a sherpa, and (of course) actually climb the mountain.
Now, what do you think climbers love most? Is it reaching the short instant joy of reaching the top? Or is it the journey to the top?
Here’s Sir Edmund Hillary (the first man to climb Mount Everest):
In other words: he WANTS the excitement of the journey. He NEEDS the challenge.
The same thing goes for most of your clients: They WANT some excitement. They NEED the goal.
This is important. It’s not the goal they WANT, it’s the goal they NEED.
Now, unless your name is Steve Jobs, you aren’t capable of enthusing people to buy what they NEED. That’s why it’s way better to focus on what they WANT.
And there’s one thing your clients really WANT, something they truly, utterly cherish from the day they are born:
They want to feel good about themselves.
That’s right. There’s nothing more they care about than me, myself and I.
How to Make People Feel Good About Themselves by Talking about Their Funeral
Sounds crazy?
Well, just read what Stephen Covey had to say about this. It’s what he calls “the Funeral-Experience”.
Imagine your funeral three years from today. Picture all your friends and family who came to honor you, to express feelings of love and appreciation for your life. As you take a seat and wait for the services to begin, you look at the program in your hand. There are to be four speakers. The first is from your family, the second is one of your friends, the third is from your work and the fourth is from your community where you’ve been involved with. Now think deeply. What would you like each of these speakers to say about you and your life?
Why is this so powerful?
Because it makes you think about yourself in a way you haven’t thought about yourself before.
If you talk (seriously) to people about this visualization experience, you touch for a moment on some of their deep fundamental values. You establish brief contact with people’s inner guidance system.
And I’ve experienced it over and over again: this is what people really WANT!
They want you to make them think about themselves.
When you ask about their ‘destination’, their ‘dot on the horizon’, their ‘end’, they’ll be engaged with you like never before.
Why?
Because you make them think about their most important asset in life. And because of that, they might gain a different perspective about themselves.
This means you are:
You see, people are more in need of a vision or destination and a compass, and less in need of a roadmap. People often don’t know what the terrain ahead will be like, or what they will need to go through it. Much will depend on people’s judgment at the time. But an inner compass gives people direction.
So, how do you do that?
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The Top 5 Questions Your Clients Secretly Want You to Ask
Let me ask you a question first. What do you think is more powerful?
No need to explain, right?
That’s what the following questions are about. So that people understand why YOU are their friend in finances.
This is the question that works every single time. The beauty of this question is that people DON’T KNOW THE ANSWER.
They always think about the usual (return, risk, cost), but never about what’s really important in their lives. When using this question, you get to the heart of what they want. Both on a financial and personal level. Yet, people never think about this. They are engrossed in their day-to-day lives, and they lose sight of the forest for the trees.
Question #2: How do you want to be remembered?
This is the equivalent of “the funeral-experience”, but the easier-to-ask-version.
The question isn’t right for every conversation. I once asked it, and it didn’t resonate at all. I’ve learned that you SHOULD use this question when people say they – in some way – feel some regrets about their past. About decisions they made in the past, that they feel sorry for. For example: they say they worked too hard, and failed to spend more time with their children.
If the moment is right, and you ask this question, it creates a really powerful connection.
Question #3: For what in life do you feel most grateful?
Another one that people really WANT to answer, but never thought of before.
It’s actually about fulfillment. You must know that a sense of fulfillment is different from a feeling of accomplishment of happiness. Fulfillment comes from achieving your clients’ hopes and dreams. It reflects a state of completeness or wholeness. It’s when you have a sense of deep satisfaction.
When you ask your client what fulfills them, it opens the door to exploring something that is invariably very special to that person.
Question #4: Why do you want to do that?
“Why?” can be a terrible question if used at the wrong time and for the wrong issues. It can communicate underlying disapproval. It can sound critical, carping, and nagging. It can make your client feel bad about themselves.
“Why?” can also be a very powerful question. It can make your clients think more deeply about what they’re doing, and help them get to the heart of their issue.
I use this question very often in my financial planning service. When I’ve analyzed that my client needs a 0% return on his assets under management to reach his goals, but he still wants to take risks, I ask them: “Why do you want to do that, now that you know you can reach your goals with a 0%-return?”
Question #5: Is there something else you’d like to accomplish?
Almost everyone has an unfulfilled aspiration or dream, no matter where they are in their career or their life. Rarely, however, do others invite them to share it.
Anyone can carry on a conversation about plans, reports, and finances. Go deeper and create a powerful moment by asking this question.
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It’s Hard To Ask Intriguing Questions
Using these questions can be really scary at first.
I didn’t dare to ask them at the beginning of my career. As a typical left-brainer back then, it was totally out of my comfort-zone.
However, if you want to be meaningful to your clients, you can’t afford not to use them in your conversations.
Why?
Simply, because these questions are all about THEM (and not you).
Just don’t forget that people want you to:
It’s your job to remind your clients about what’s most important in their lives.
So, when you sell your financial planning service, meet your prospect for the first time, or have your next client meeting, don’t ask questions about finances.
Ask how they want to be remembered. Ask what they are most grateful for.
Ask questions about THEM.
(and they’ll happily consider their financial goals too)
Want to know how to use the "7 Habits" in your client-relationships, but don't have the time to read the whole book?
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Summary, tactics & copy-paste examples in less than 10 minutes