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Advisors Use More Visual Tools With Clients

If clients spend three to five minutes a day picturing themselves in retirement and writing down how they would feel in retirement, they become 25 percent more likely to boost their savings rate, said Ted Klontz, principal of Klontz Consulting Group, citing research by ING Financial. Klontz spoke on investor psychology at last month’s NAPFA conference in a presentation called “When Logic Leaves the Room, and What We Can Do About It.” He also said that if you pick an exact age and year for when a person will retire, they’ll be willing to wait 40 percent longer to spend their money, according to Shane Frederick, a marketing professor at Yale School of Management. Why? According to research conducted by Paul MacLean, former director of the Laboratory of the Brain and Behavior at the United States National Institute of Mental Health, the language of two-thirds of the brain is not abstract and rational; it’s tactile, emotional and visual.

Appealing to the visual, emotional part of clients’ brains can help clients better understand concepts surrounding money and better engage with their advisors, Klontz said. In fact, financial advisory firms and financial planners are increasingly using visual tools, including interactive games, drawings and video, to motivate and involve clients or attract new prospects. These tools often work better with clients than focusing on the quantitative aspects of planning or on selling a product, say advisors.

For example, United Capital, an RIA firm based in Newport Beach, Calif., recently rolled out its Honest Conversation Toolkit, a card game designed to help clients prioritize financial goals. Joe Duran, CEO of United Capital, said the firm began offering the toolkit because advisors wanted tools that would better integrate the client into the decision-making process. The intellectually-driven, mathematical tools are out there, but, “Almost all decisions when it comes to money are emotional.” The card game allows FAs to bring emotion into the equation.

Clients receive three sets of cards, categorized as fears, commitments and happiness. Within each of those categories, there are five areas of concern, and advisors have clients prioritize those. According to Duran, this allows each person to determine their money mindset that shapes their thinking. “The more they [clients] simplify and talk in simple terms, the more successful they’re going to be,” Duran said.

Jennifer Lazarus, a planner with Lazarus Financial Planning in Durham, N.C., uses a family genogram with some of her clients, which allows them to better understand the relationships that their family members have to money using drawing exercises. Lazarus said the exercise gets clients talking, and it allows her to learn things about her clients that she might never have heard had it not been for the exercise. After trying it out, she recalled a relatively new client saying, “I used to hate this money stuff, and now I’m actually enthusiastic about it.”

Stephanie Bruno, an advisor with Cascade Financial Management in Denver, started using a similar “family money tree” tool this year. She also uses what she calls a “money purpose map,” in which she takes financial and spending information about clients and plots it onto a visual map. The tool engages clients to think about the purpose of money, rather than the money itself. “They get people talking, and the more you get people talking, the more they’ll engage with the advisor and develop a relationship,” she said.

Carl Richards, a financial planner for Prasada Capital Management, has seen increased interest from advisors for his sketches on, and he’s now in the process of publishing a book of the drawings. Richards launched Behavior Gap about four years ago as a way of selling and distributing the sketches he was using with his clients, which are simple Sharpie drawings that use humor to illustrate concepts about money. His most famous one is a line graph that points to “greed/buy” at the top of the cycle and “fear/sell” at the bottom of the cycle, followed by, “repeat until broke!”

According to Richards, one advisor who was using the sketches told him that they had a big enough impact with a prospect that the person became a client.

Richards said advisors often get bogged down in language that clients don’t understand, and this type of visual can help break down that language barrier. “There is clearly a need to develop a new framework, a new language around money,” he said.

Communicating Through Video

Aside from drawings and games, some advisors are using video more to educate and communicate with clients. Tim Maurer, a financial planner and vice president at the Financial Consulate in Hunt Valley, Md., has recently put in place a more deliberate strategy for reaching an audience through videos on his website,

When the financial crisis hit in 2008, his firm started communicating more often with clients, and one client wrote back saying, “I’m a visual person,” Maurer recalled. So he started using video as a way to update clients.

Now, Maurer’s video strategy includes “90 Second Finance,” short video segments in which he uses a whiteboard to speak on a particular topic, such as life insurance or IRAs. The strategy also includes video features, a more drawn out video format that appeals to the senses, rather than the dollars and cents aspects of financial planning, he said. These videos, which use music and are more produced, use creativity to communicate deeper truths about financial planning. “We as financial advisors don’t understand that our clients don’t care about this financial planning stuff as nearly as much as we do,” he said.

Michael Wall, president of wealth management firm Wall Financial Group in Altoona, Pa., recently launched the “Annuity University,” a website featuring videos explaining complex annuity topics in simple terms. There’s a lot of confusion specifically around annuities, and these videos go deep enough that investors learn but not too deep that they don’t understand, Wall said. The videos talk about both the pros and cons of certain types of annuities.

Wall’s initial concern, however, was that people would think he just does annuities, so he plans to roll out a new site covering other types of investments, including mutual funds, ETFs, stocks and options. Wall said his clients also have more of a comfort level with him because they’ve seen him on video.

Selling Technologies, a company that helps advisors connect with clients on an emotional level using multi-media tools, has seen a 50 percent increase in volume and interest for its services this year, said Michael Mainardi, founder. Mainardi provides training for advisors in delivering an interactive presentation, which includes a short video on a certain topic and an interactive discussion on what the audience just saw. Clients and prospects then fill out a series of questions on the topic and are given a score. If they didn’t score well, the advisor offers to sit down with them and talk about how to fix the problem.

There can be a stigma that comes with selling a product, so this approach steers clear that, Mainardi said. “If you motivate someone emotionally and remove the product aspect, they’ll perceive you differently,” he said.

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