Before Allie King and her husband, Jeremy, launched their independent advisory firm, Mountain Sky Wealth Management, in May, she worked at AIG Retirement Services (now Corebridge Financial), advising individuals and groups. When she started there about six years ago, she would knock herself out preparing for meetings with clients she hadn’t met before, poring over notes from previous advisors at the firm and creating a strict agenda. Then a mentor took her aside and gave her some advice: She had to chill out—and stop talking so much. “I learned to ask clients about their families and their lives—and to just listen,” says King.
A lot of advisors like to jump in and offer advice. They want to seem smart and they have a lot of knowledge to share, so sitting back and listening deeply to their clients—their wishes, preferences and fears—doesn’t always come naturally. It might even sound a bit on the touchy-feely side. But, the fact is, knowing how to listen is one of the most important, if not the most important, interpersonal skills advisors can have. Feeling that an advisor didn’t pay attention to what they really want is a common reason for clients to leave, typically quitting without ever explaining why.
“[Effective listening] is an essential professional skill,” says Michelle Barry, president of independent broker/dealer Grove Point Financial. “It’s critical if you want your clients to trust you.”
The Power of a Pause
Brimming with what they think are good ideas and smart strategies, many advisors’ first impulse is to commandeer the discussion with a client. One useful technique in such cases is the power of a simple pause. That means, after asking a question, letting the client answer and then not responding to those remarks right away. Instead, wait a few seconds. The client most likely will fill in the silence by talking more. “Don’t be afraid of a little silence,” says Barry.
Take Vaughn Kellerman, an advisor at HCM Wealth Advisors in Cincinnati. About three years ago, when he first started working directly with clients while at a different firm, Kellerman decided to look for advice about communication skills. Then he heard on a podcast for financial advisors about how to use silence. “I learned to count to 10 in my head when the client finishes a thought,” he says; although, according to Kellerman, he often wouldn’t even get that far, because clients tended to rush to fill the gap before he got there. He accomplished a dual benefit: Clients discussed a topic in more depth than they might have otherwise and Kellerman was able to highlight his attentiveness.
Many such listening techniques fall under the general rubric of “active listening.” That methodology, developed decades ago, aims to help people understand what others are saying, from the speakers’ point of view—and convey they’re doing so. Some of the key steps are not interrupting, paying attention to nonverbal cues and avoiding the appearance of being judgmental. Less obvious ones include paraphrasing what clients just said, so they feel heard, and asking open-ended questions, to encourage a more in-depth response.
Another starting point is to record conversations with clients, with their permission, of course. When, about three years ago, Joanne Burke, a CPA with her own tax practice, formed Birch Street Financial Advisors in Vienna, Va., she was brimming over with ideas about how to do holistic financial planning. A year and a half later, she started taking classes from Money Quotient, a program that teaches financial advisors practical lessons for building client relationships and navigating client conversations. There, she was encouraged to record her client conversations, so she could gauge just how much she was speaking versus listening. “I learned I was speaking a lot more than I should have been,” she says. Those recording provided a useful way to assess her progress.
Similarly, Kellerman decided to record conversations when he was starting out. His first goal was to assess whether he was wording his questions clearly. But that evolved into listening to clients, to make sure he hadn’t missed anything important. It led to some important discussions. Kellerman points to one recording of a husband and wife during a discussion of retirement planning, and he realized they’d made several offhand remarks about whether they could afford to send their high school–age daughter to college. Next time they met, he brought it up, and that led to their forming a college savings plan. “The tactic was a huge help to me,” he says.
Now Kellerman usually records conversations with clients only during the first meeting or two. “I feel I know enough that I don’t have to do it all the time,” he says.
Pushing for More and Listening to Everyone
There are times when advisors listen attentively, but their clients simply don’t provide enough information. A few years ago, while working as a lead advisor at the H Group, an advisory firm in Salem, Ore., Brenna Baucum realized that, with some clients, she was covering the same issues at every meeting.
To address this problem, she took a class where she learned about how to get clients to explore more deeply the reasons for their spending and investing preferences. One recent example was a man who was overly conservative with his money, refusing even to plan an affordable vacation. No matter how thoroughly Baucum ran the numbers, discussed the results and listened to the client’s questions, he wouldn’t budge.
Drawing on her newfound techniques, she asked him about what the financial situation was like while he was a child. In response, he recalled a hardscrabble background where the family struggled to keep their restaurant in business. “With tears in his eyes, he told me he couldn’t believe he now had this much money and didn’t know how to be a good steward of it,” says Baucum, who formed her own Salem, Ore.–based firm, Collective Wealth Planning, in December. Two weeks later, the client called back to talk about withdrawing money to pay for a vacation.
Remember to include everyone at the table, drawing out and listening to all family members. That‘s true for conversations with couples, as well as meetings with partners or children. Making sure everyone feels heard helps build a bond with the whole family and establishes the advisor as an empathetic person. “You don’t know who the real decision-maker is or whether one child is insulted because you didn’t make eye contact during a meeting,” says Barry.
Living in the digital, always-on age adds a new complexity. Continual interruptions from text messages, emails and IMs make attentive listening harder than ever. In fact, some people suspect that those continual distractions are contributing to an overall decline in advisors’ listening skills. “There’s a very timely reason why people may not be listening as effectively as they could be,” says Barry. “We’re so used to multitasking.” She suggests not only putting phones away during meetings but also being particularly careful during Zoom meetings, when the temptation can be especially strong to steal a look at messages and emails. Clients are likely to notice.