Most people find talking about their personal finances difficult. That’s why interviewing a new client presents a challenge for both clients and advisors. But by asking the right questions — and getting honest answers — an advisor can provide appropriate financial advice.

The key to a successful client interview lies in creating an atmosphere of trust, says Robert O’Keefe, senior vice president of financial services at Investors Group Inc. in Winnipeg.

“People are reticent to disclose personal information until you’ve given them a good reason to do so,” he says. “When they understand that you are going to make them better off financially and that you really and truly care about them, they will open up the world to you.”

IG advisors are trained to ask a series of questions with the goal of creating a financial plan, he says.At the initial meeting, more time is spent interviewing and getting all the questions answered than on the diagnosis.

“By asking all the questions, I want the client to know that I am thorough in my analysis and that the only way I can provide a good solid financial plan is if I do my homework,” he says.

Before the client interview, Jim Rogers, chairman of Rogers Group Financial Advisors Ltd. in Vancouver, sends material to the client explaining the basics of financial advice and the services his firm provides.

BRING THREE DOCUMENTS

He also asks the client to bring three documents to the initial interview: a balance sheet showing what he or she owns and owes, an income statement and a detailed list of normal monthly expenses. He also asks the client to list three top financial concerns, in order of importance.

The three documents give the advisor a snapshot of the client’s financial situation, Roger says. Within a minute, the advisor can spot where a problem lies instead of wasting “face time” asking questions about numbers.

“In that meeting, I want to give the client an idea of how I can help — not just do an inventory of the situation,” he says.

Rogers has found that these four questions have proven valuable:

> If Today’s Meeting Is To Be A Successful One In Your Terms, What Has To Happen? The answer to this question helps the advisor understand the client’s expectations and whether the advisor can deliver. “If the expectations are not a fit, the advisor and client will not waste each other’s time,” Rogers says.

> What Financial Concerns Could Or Do Keep You Awake At Night? The answer will reveal the client’s anxieties, and on what you will have to focus in order to ease his or her worries.

> To Get The Value You Seek From Your Financial Advisor, What Services Must Be Provided? This is another way of determining the client’s expectations. “Experts have said the key to being a successful financial advisor is managing your client’s expectations,” Rogers says, “making sure you deliver what the client expects, and that the client understands what you can and should deliver.”

> What Needs To Happen To You Personally, Professionally And Financially For You To Have A Good Next Three Years? This is a powerful three-part question, which often yields interesting answers because it goes outside finances. “You’ll know how the client is going to measure success over the next three years,” Rogers says. It also shows that the advisor is interested in more than just the client’s financial life.

EXCHANGING CONFIDENTIAL DATA

Here are some more pointers from the experts on conducting a client interview:

> Make Sure The Client Feels Comfortable. “A true professional financial advisor is skilled at providing the kind of environment that allows for the exchange of confidential information,” O’Keefe says.

Try to maintain the tone of an informal conversation rather than a formal interview. Avoid financial jargon. Be patient and don’t rush the client. Make sure you won’t be interrupted during the meeting.

> Listen To The Client. Two-thirds of the time should be spent listening, according to Rogers. You can’t learn anything about your client if you are talking.

> Ask Open-Ended Questions. Avoid questions that can be answered with a simple “yes” or “no.” Instead of saying: “Do you plan on travelling when you retire?”; ask: “What are you most looking forward to in retirement?”

@page_break@> Don’t Do “Black Box” Selling. Don’t try to fit the client into a product on your shelf. Put the client first. Rogers says advisors often make the mistake of offering solutions before they have asked enough questions.

“After you have asked all your questions and figured out exactly what the client wants, then you can fit the client to the appropriate product,” he says. “If you don’t ask a series of comprehensive questions, there will probably be an ill-fitting solution.”

O’Keefe puts it this way: “Seek first to understand before you can be understood.” IE