Engage Your Clients With Financial Planning

Helpful tips to aid your clients in working toward their financial goals

As a Financial Planning and Wealth Advisor, understanding the clients’ situation in the broadest context is very important. All advice given is in the best interest of the client. Understanding this allows us to help the client work toward achieving their personal and financial goals. Broadening the conversation around the issues that impact the clients’ goals helps us understand and predict client behaviors.

Here are some current talking points you can engage your clients with around Financial Planning along with a recommended action plan for next steps.

Inflation vs. Budget

The Consumer Price Index for All Urban Consumers (CPI-U) has been in territories we have not seen in a few years. The CPI-U is currently trending around 9.1, with Energy leading the way at 41.6. We all feel this squeeze on our budgets as the work commute gets more expensive and the grocery store run hits the “wow” factor. What can be done?

Now is the perfect time to review your clients’ budgets to look for savings! We all know where our money is coming from, but where is it going?

Tips to help your clients take control of their budgets:

30-day review of their accounts

  • Have them log-in and look at where they have been spending from their bank accounts and credit cards. Sure, the amount they spend on gas will be higher, but how about eating out and monthly subscriptions? Do they really need Netflix, Hulu, Sling, Disney+, Philo, HBO Max, Peacock, and Fubo TV?  How many free trials are they now paying for?

Have your clients pay themselves first

  • Have them set a savings goal and automate it. Instead of “I’ll save whatever is left over,” have them try saving first, and whatever is left over is their reward.
  • Have them consider taking advantage of Roth conversion opportunities now that IRA balances have lost value, due to market conditions.

Good Advice is Valuable

Paying a fee for asset management should not be looked at as an overall cost, but to the value the Advisor brings. Having a trusted Advisor to guide them through turbulent times will save them money in the long run. As we all know the adage, saving for retirement is not a sprint but a marathon to the finish. A study done by Vanguard (Vanguards Alpha Research Team, 2019) showed that consulting an Advisor adds about 3% in net return for clients. Providing a personal touch is the great differentiator to the online robot. 

Consulting with an Advisor allows them to leverage their expertise with navigating different markets. This in turn, gives the Advisor the opportunity to understand clients’ behaviors and expectations. (I cannot tell you how many times I have received a call from a client with an investment idea that (insert brother-in-law, co-worker, pool guy, landscaper, Boss, etc..) told them was a SURE THING. I am not saying the investment idea was a bad idea. The investment idea just may not be the best option for the client. Taking the idea out of the vacuum and looking at it from the lens of the clients’ specific goals, timeline, risk tolerance, and current portfolio is what is needed to determine the idea’s worth to the client exclusively. Does the client have to sell a position at a gain/loss to implement this new strategy/idea? That is what we are here for.) Clients may challenge their Advisors with an idea and how to implement it. It may be a good idea; it may not be the right time or the right risk.

For every action there is an infinite number of alternate histories based on different decisions. Clients have a path that they’ve traveled to get here. An Advisor has worked with and seen many other paths. This experience is very valuable.

Advisors now have many tools, assistance, access to experts, financial planning tools and experts, and the time to dedicate to our clients’ finances.

Interestingly enough, the study broke down the areas the most value comes from. It is not products. The main value is Behavioral Coaching, Asset Allocation (the main breakdown between stocks, bonds, and cash), and Spending Strategy. Yup, back to that budget.

By the way, rebalancing your portfolio back to your original allocation made up .26% additional return vs. a portfolio not rebalanced1. Go talk with your clients about rebalancing!

What is the Plan?

A well thought out plan is good. A well thought out plan written down is GOLD. A well thought out plan should have a few basic characteristics:

  1. Prioritized goals
  2. Timeline on actions and responsible parties
  3. Reasons for the actions and the behaviors the action will support
    • E.g., The emergency fund will support your clients’ goals of being able to pay off debt, so they can stop using the credit cards. They agree to save $500/month to the emergency fund (that we will set-up for you) until you reach $6,000, at which point we will accelerate their debt reduction and retirement savings.
  4. Topics for next meeting
    • At the next meeting we will discuss your Wills, Living Trusts, ILITS, POA’s and health care directives. Contact your attorney (or our referral) to start the process.
    • Legacy and charitable strategies
    • Estate planning

The written plan enables you to refer back to the clients’ agreed upon actions and timelines. It also sets up topics outside of the investment conversation. This is the great way to weave in the behavioral coaching, that adds so much value.

A quick word on Estate Planning. Estate planning does not have to be all ILITS, CRT’s, and advanced permanent life techniques. Everyone needs the basic Estate Plan. The basic Estate Plan clarifies how your clients’ assets and liabilities will be handled in case something would happen to them.  

Estate Basics:

  1. Get a will
    • Update their will if they have moved states
    • Update their will if life has changed (Children, grandchildren, marriage, retirement, etc.)
  2. Powers of Attorney
    • Make sure they are specific, durable and springing
  3. Health Care Directives
    • These are their healthcare wishes on the hard decisions their emotional family should not have to make
  4. Living Trust
    • This is a living document that they can put assets in and take out
    • They can be creative with this trust. The trust can be used for control, to incent certain behaviors, or give to charities
    • Add the trust as a beneficiary
  5. Review their beneficiaries on their accounts
    • Beneficiaries supersede wills and probate
    • Ex-partner still on that old 401K?

1.Vanguard calculations based on data from FactsSet.


Engage Your Clients Today!

These are just a few tips to help get conversations started with your clients on the importance of Financial Planning and how it can impact their short-term and long-term goals.

For more tips on Financial Planning or would like to schedule a consultation with me to see how I can best assist you with Financial Planning for your business, please email me at planning@lplatfrg.com

Rob Matricardi, CFP®, Head of Financial Planning

Rob Matricardi, CFP®, Head of Financial Planning

Broadening the conversation around the issues that impact the clients’ goals helps us understand and predict client behaviors.

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