How do I incorporate expectations, compensation, and how we get paid into the Financial Road Map Interview™ conversation with a new client? Should I be covering this information before the Financial Road Map Interview™, or if not, when?
This happens during the Commitment to Hire Conversation™. They ask you questions about the boundaries of the relationship, which you answer honestly. If you have things to communicate about your boundaries you can do this then. Specifically to your point, by the time you get to the Commitment to Hire Conversation™ and offer to be hired you won’t have to verbalize your expectations about clients being honest. You will know by now if they are honest. If it’s not obvious you will not offer to be hired.
Should we prepare a list or outline of our Deliverables Team to show to people in the event they ask a question during the Commitment to Hire Conversation™, or just outline it verbally to them?
Outlining your ability to describe your Deliverables Team articulately is important. Having a printed listing of your Deliverables Team, describing their skill and experience is fine.
When you review the outline of your Deliverables Team in the Commitment to Hire Conversation™, is this done in response to a specific question a client may ask?
Yes. Restate the part telling exactly what they get. Remember, these are memorized words that you have said many, many, many times. It’s the first time for them. Sometimes people need to hear them more than once to get it. That’s why it’s so important for you to record, so you can listen to yourself to be sure you clearly articulate and go at a pace that is effective for the first time listener not for you who’s said it 100 times. Remember, your Deliverables Team isn’t so much discussed as they are incorporated into the implementation of the plan’s action items. For example, if there are action items related to estate planning you schedule the meeting with the estate lawyer. Building the Deliverables Team and the processes that surround this a very important element for you to deliver on the Values-Based Financial Planning™ promise.
During the Financial Road Map Interview™ when I’m telling the client exactly what they’re going to get in the way of a financial plan, the script talks about the four areas but never mentions their goals that we just spent time and energy identifying and then emotionally tying to them. Is it just assumed that the goals will be planned? Seems like I should say we’ll give you a plan for meeting your goals, which is of course, what we do.
The goals are referenced in the script. Page 54 of Module 2. You may find it easier to print the script from the document CD.
In the Commitment to Hire™ script you say, "Would you like to hire us to create this plan for you?" I'm assuming that, as a solo practitioner with one administrative assistant, I'd say, "Would like to hire me" not "us." Or is there a reason to say "us"?
There’s no such thing as a Trusted Advisor “solo practitioner.” You can’t possibly deliver on the promise you made during the Commitment to Hire Conversation™ by yourself. The “we” includes the Subject Matter Experts who comprise your Deliverables Team and are going to provide the actual advice to you about insurance, taxes, asset management, estate planning, and so on. It’s the people who help you write the plan, or use the software to write the plan, and the back office people who make everything happen from account transfers to underwriting.
During my first meeting with existing clients, I have a short Old World New World™ discussion. After asking them if they have any questions, I move into the Financial Road Map®. A number of clients, however, during Commitment to Hire Conversation™, still have significant questions related to the Old World. In fact, they clearly trust me more and are more willing to ask the "hard questions." How should I handle this?
It’s perfectly acceptable for clients to ask the “hard questions” during Commitment to Hire Conversation™. If the clients have questions that need to be answered before they hire you, you want them to ask those questions before they hire you. If they do hire you after having their “hard questions” are answered, they are much more likely to actually implement at the Implementation Meeting. Their questions are also a very important opportunity for you to gain more insights about them so you can make a good decision as to whether or not you want to be hired.
There are many forms that my clients must fill out. They are not something that can be done in the "let's take a few moments to make that happen" section. I need to prepare the paperwork and it takes more than a few moments.
What I like to do is have the clients come back in to do the paperwork and go over any other information in the questionnaires I need. Then, after that, I will complete the plan and have the clients back in to go over that plan.
NO!!! It is not client- centered to schedule another entire meeting. Once the clients are in the office and want to hire you, complete the paperwork then and then proceed with Commitment to Implement. Here’s my advice: 1. Review these “forms” and decide how much of that information they actually need to be present to complete. Our experience is that much of what needs to be completed can be transferred from the documents they brought with them for the meeting. Don’t make them write their Social Security Number and address on 3 different forms. That’s very irritating and poor client service. Hiring you is supposed to save them time, not waste it with paperwork. 2. After a thorough review by you and your administrative team members to streamline the process, decide how much time you need to schedule the meeting, including the Financial Road Map Interview™, and completing the documents necessary to hire you. Schedule your meetings for that length of time. If you don’t choose to...
In the Financial Road Map Interview™ script there is no area where the fees are discussed. Fees are obviously an important part of a client’s decision making, when should this be mentioned during the Financial Road Map Interview™? Is there a specific way this should be projected to the client?
This is covered in Commitment to Hire. Have you watched the DVD of the Financial Road Map Interview™?
During our Commitment to Hire™ and Commitment to Implement Conversations™, the clients expresses their concern that, “we not go too fast.” They agreed to all the money, but, that does not mean all the money RIGHT NOW (Or even the day we are scheduled to begin implementation).
We are talking here about the entirety of their life's work, their health and the rest of their lives, their savings, investments, home, their children and grandchildren's future - and they are justifiably cautious about making a global decision -
Trust - but verify. It is only prudent and wise financial planning!
Are top advisors taking All The Money on that first implementation day? How does THAT happen?
The main reason that it’s not happening for you is because you don’t believe it’s a good idea for them to move everything to you. Therefore, you are telegraphing that in your way of being. And, YES, many advisors have their clients agree to move EVERYTHING to them during Commitment to Hire™ and Commitment to Implement™ and the clients actually follow through during the Implementation Meeting™. The question is, “is it better for the client to move everything so one advisor is the orchestra conductor?” And the answer is yes. Why? Consolidate. Coordinate. Simplify.
I recently had a client say that she did want to hire me, but as she'd just paid a large legal bill and was in need of financial advice to create income from her assets she was unable to pay my usual up front $3000 fee right away. What do you recommend I do to test or create her commitment to follow through with payment and implementation such that I could confidently proceed to create her plan?
As her financial advisor where would you recommend she draw the money from to pay you? If she really couldn’t afford to pay you, you would not have offered to be hired. Instead, you would have said, “After reviewing your financial situation I don’t believe you can afford a Financial Advisor, or you can’t afford for me to be your Financial Advisor. My advice for you going forward is…” and you would either refer her to a Do-It-Yourself website / process or to a less expensive Financial Advisor. However, if you have completed her Financial Road Map® and offered to be hired, then you must know the facts about her financial situation. Knowing those facts, you would say something like, “As your Financial Advisor my advice is that you pay your Financial Advisors fee from…” The options are checking account, savings account, money market account, etc. If she is already not following your advice from the very beginning this is not the way to begin a good client / Financial Advisor...
When doing Financial Road Maps® for existing clients, I know they are not going to be going forward when I get to the Commitment to Hire™ because I know what they have in assets. Is it important to still proceed as if I didn’t know? And, should I be doing Financial Road Maps® on these people.
First of all, one of the common experiences of advisors getting started with Values-Based Financial Planning™ and doing Financial Road Maps® is that they discover clients have money elsewhere that could make them Ideal Clients, so do yourself a favor and do not assume you have all their money or even know where all their money is. Have them come to the Financial Road Map Interview™ appointment, with both spouses, and bring all of their financial documents. There is a clear pause between All The Money Conversation™ and Commitment to Hire Conversation™. If you do not want to be hired, do not offer to be hired. Just tell the truth about why you don’t believe you should be their Financial Advisor and give them advice about what do next. It could be a referral to another advisor or guidance to connect with quality Do-It-Yourself resources. Not everyone is supposed to be working with you and not everybody is supposed to be working with a Financial Advisor at all. Please click the...
What is the course of action if the Ideal Client agrees to move forward after the Commitment to Hire Conversation, but does not carry a check-book (very few people these days do)? Are documents accepted? Is the follow-up meeting planned? Work started? Etc.?
When you schedule the appointment ask them to bring their checkbook. If they don’t bring it, just have them mail one.
Under my current model, there are different means of compensation, depending upon the deliverable (I.e., planning fee, % of AUM, insurance commission, other). It seems that the planning fee would logically be part of the Commitment to Hire. When would the other pieces be brought into the discussion?
It is. Almost every time you offer to be hired they will ask how much you charge. Just tell them. It tends to unfold very similarly to how it unfolded with Robin and Larry on the DVD in Mastery Series #1.
I have been advised that there is a psychology that comes into play when a client pays for services (They are much more invested in the process if they pay for the service, no matter how little/much). If the payment does not take place until implementation [%AUM], does this minimize their commitment to the process? (Your experience here, please).
What if there is no formal agreement to sign until implementation and the transfer of assets? What affect does this have? Do you have something that can be used? I am trying to find a "workaround" to the Financial Planning Agreement of my RIA, while still being compliant.
I am not so concerned about the psychology of the situation. I just think it’s good business to get paid when you get hired. If you are able, with your current licensing and / or registration, to collect a fee during the Commitment to Hire conversation of the Financial Road Map® interview then do that. If not, do whatever works within the parameters of the law / regulators for you. We don’t have “work-around.”
I have been running a "quarterback" model business for the last few years so hiring me to do what I’ve already been doing BUT much better shouldn’t even be questioned. However, most clients I have on a AUM fee, discretionary agreement. I'd like to present a new "flat fee" discretionary agreement, with formalizing me as the Trusted Advisor. Do you have an outline of items recommended in the agreement or examples I can give my attorney to create one for me. AND should I use the Commitment to Hire part of the Financial Road Map® meeting to have them sign to commit?
We're not lawyers, so we avoid giving legal advice. My general advice is that your agreement should clearly indicate the amount of the fee and what they get. Your agreement should be signed by the client during Commitment to Hire and everything related to being hired should be completed before Commitment to Implement.
I am new to Values-Based Financial Planning™ and under my organization I do not yet have a Deliverables Team. We are in the process of creating it but it may be months to a year down the road as an organization. How do I build a plan in the meantime that will create or show how my quoted fee or desired fee of $5000 per year is paid or able to be paid by the client?
I appreciate that you are already thinking about being a better Financial Advisor who delivers more value to your clients. Well done! The short answer is that you do the best you can with what you have. Rome wasn't built in a day, as the saying goes. It takes one to two years to build a Deliverables Team of best-in-class Subject Matter Experts who can help you deliver on the full Values-Based Financial Planning™ Value Proposition. Your main objective during the evaluation phase of working with us is to do as many Financial Road Maps® as possible so that some of your existing clients do more business with you and your prospective clients hire you more quickly and do more business with you than they did when you did not use the Financial Road Map®. This produces two results: 1. It generates the money you will need invest in the Committed Advisor Program (CAP). You should have a $30,000 - $50,000 Return On Investment by the time you attend your first Academy in San Diego. 2. You...
I am new to Values-Based Financial Planning™ and under my organization I do not yet have a Deliverables Team. We are in the process of creating it but it may be months to a year down the road as an organization. How do I build a plan in the meantime that will create or show how my quoted fee or desired fee of $5000 per year is paid or able to be paid by the client?
I appreciate that you are already thinking about being a better Financial Advisor who delivers more value to your clients. Well done! The short answer is that you do the best you can with what you have. Rome wasn't built in a day, as the saying goes. It takes one to two years to build a Deliverables Team of best-in-class Subject Matter Experts who can help you deliver on the full Values-Based Financial Planning™ Value Proposition. Your main objective during the evaluation phase of working with us is to do as many Financial Road Maps® as possible so that some of your existing clients do more business with you and your prospective clients hire you more quickly and do more business with you than they did when you did not use the Financial Road Map®. This produces two results: 1. It generates the money you will need invest in the Committed Advisor Program (CAP). You should have a $30,000 - $50,000 Return On Investment by the time you attend your first Academy in San Diego. 2. You...
I really need some simple language to explain the following issues. We are charging a flat fee of $9,870 per annum, plus all the Deliverables, which will add up to a total of a minimum of another $10,000. Do I, for example, just state the total will be say $22,000 per annum, or do I just suggest our fee does not include the things you buy to advance progress towards their goals.
Yes: $22,000 / year is your fee. Quote it, with confidence.
I have been following the script with Commitment to Hire Conversation ™ and detailing them exactly what they will get. We had a Follow-Up Meeting the other day with a client where we do a Risk Profile (legal requirement) and they were asking further questions around money management etc. Although they knew they were getting a plan they didn’t realize we handled everything (i.e. professional money management) and they said if they realized we did so much they would have been far keener to go ahead. Should we also have a list of client deliverables to show them?
This is covered when you follow the Commitment to Hire Conversation™ script telling them, among other things, that you will tell them how to allocate their assets so they have the highest probability of achieving their goals when you summarize the for quadrants in the lower left of the Financial Road Map®. No, I would not have a complete list of Deliverables, but you might refer to the Deliverables Team illustration to be able to explain, GENERALLY, what key experts are used to help them get their entire financial house in order.
Prior to hiring Bachrach & Associates, Inc., I had already created several of the deliverables on an annual basis for clients. I have been charging between $500 and $1,000 for this type of planning in addition to AUM wrap fees. Can you help me gain clarity and perhaps some verbiage on why a current client should pay 2x-3x times what they are used to?
At this point you may not be able to justify why they should pay more money. As you continue on your Values-Based Financial Planning™ journey, however, you will be learning about a level of client experience, client service, and value delivered that will easily justify a higher, maybe significantly higher, fee. Whether a client chooses to come to your New World and pay the higher fee for the greater value is for you to work out with your clients. The clients who come into the New World will be your base from which you build your entire Ideal Client Community, by referral only. On the other hand, you may already be charging too low of a fee for the value you provide. In which case, the language might sound like, "After doing some serious numbers crunching in my business it has become clear to me that I've been charging much too low of a fee for the service and value that I have been providing. As such, we will be right-sizing our fee to $ / , effective . Do you have any questions...
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