What a Financial Advisor Might be Able to Learn from a Professional Educator
My husband Gary is a teacher in our local school system. He, along with his colleagues, was recently invited to an educational seminar focused on helping employees understand the various retirement plans the district offers. The session was about an hour long and attended by roughly 25 employees. It was led by the nice folks in Human Resources, who promptly turned over the more in-depth retirement planning discussion to the financial advisor managing the plan.
Gary came home that day looking a little weary, and handed me a few sheets of paper that were stapled together. “I think I need a professional to explain this to me,” he said. “Maybe you can help.”
I took a cursory glance, noticing the giant, complex line-graph on the front page, followed by a few pages that looked like a data dump of numbers spanning hundreds of rows and columns. The teeny-tiny font immediately required the reach of my reading glasses.
“A nice-enough, mid-50ish, suit-type guy,” is the way Gary described the advisor to me. “However, I really didn’t understand a word he said. I couldn’t follow him,” he admitted. “At first, I thought it was me, and I just don’t get it. But I talked to a few colleagues afterward and they didn’t either. I have no idea what this sheet is saying, and I don’t know what to do next,” he added as he pointed to the slightly crumpled hand-out.
The irony that my husband implied he needed help from a professional to understand the financial professional was not lost on me. Today, consumers are inundated with more information than ever before, and if they don’t understand it, they tune it out. Financial advisors who do not take the time to hone their communication skills -- simplifying complex topics, cutting out jargon and regularly checking in to ensure their clients’ understanding -- are in danger of losing clients and not growing their practices.
Perhaps what most struck me is that the exact audience the advisor was presenting to – classroom educators – is the same audience from whom advisors can take a communication lesson. When I think about strong communicators, some of the best I know are educators, and we as an industry should model some of their proven techniques:
- They synthesize large amounts of complex information into easy-to-understand, bite-size nuggets of information. They simplify the most complex information to capture the essence of a topic or concept, and make it relatable for the students, using examples and analogies.
- They make it interactive, regularly asking questions to engage students and encouraging students to offer their own points of view.
- They check in with their audience and tailor their lessons accordingly. Educators regularly pause, ask questions and ensure their students are following along. They are consistently scanning their audience for body language cues that imply whether students seem confused, bored or frustrated – and they adapt their lessons as needed to meet the needs of their students.
When I think about the retirement plan session Gary attended, I can’t help but wonder if the outcome would have been different had the advisor run through his presentation and asked for feedback from an educator first. Just as communication skills set the outstanding, memorable educator apart from the mediocre teacher, I believe that in today’s rapidly changing industry, the most successful advisors will be the ones who have spent the most time refining their communication skills.
Envestnet, Inc. (NYSE: ENV) is a leading provider of intelligent systems for wealth management and financial wellness. Envestnet’s unified technology enhances advisor productivity and strengthens the wealth management process. Envestnet empowers enterprises and advisors to more fully understand their clients and deliver better outcomes.
The opinions expressed herein reflect our judgment as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities, or investment advice or a recommended course of action in any given situation. Investment decisions should always be made based on the investor’s specific financial needs and objectives, goals, time horizon, and risk tolerance. Information obtained from third party resources are believed to be reliable but are not guaranteed. This paper may contain ‘forward- looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this paper is at the sole discretion of the reader.
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