Originally posted at fa-mag.com by Mitch Anthony, February 1, 2023.
Advisors are usually encouraged to talk to their clients about their goals, to ask questions like, “Where would you like to be in five years?”
But how much richer would the conversation be if we asked them instead, “Where have you been in the last five years?”
The past is known. The future is unknown. Do you want to begin trying to build relationships on the vague and formless, or is it better to begin building on the known, the experienced and the objective, complete with lessons learned?
Once you see the importance of asking people about their histories, you’ll develop an insatiable appetite for knowing. Your clients’ pasts explain almost everything about them: who they really are, how they grew up and how they built the lives they have.
So, exactly what stories do we want to hear? What pieces of information are most important to gather as we become financial biographers?
Before we answer this question, let’s talk about putting people’s lives in context.
We have been misguided about how the mind works, and that has impaired our discovery processes. A mind doesn’t naturally operate by seeking logic or filling in data fields. Instead, we have association mechanisms made available by our neurons and the connections among them, known as synapses. Scientific American has said that there are some 100 billion neurons in the brain that make some 100 trillion connections!
Put it another way: When physicist Brian Greene was asked why he was so much better than his peers at communicating, he answered: “If I’m relying on mathematical symbols, I don’t feel like I have the true heart of the science. When it comes to communicating with the public, I take those mental pictures I’ve developed, strip away the math and wrap them in a story.”
When you evoke ideas in your clients, their minds immediately find links to other experiences, observations, memories and associations made available by our brains and neurons.
Financial services is similar. The true science of what you do is not found in the math but rather in telling it, the way Greene does, through your clients’ stories. Although there are many paths you can take here to tell their tales, there are a few you don’t want to miss, including the defining events of their lives and their experiences with money.
When you are talking about their history, here are three questions you can ask them to find their roots:
1. What was your first job?
2. What kind of work did your parents do?
3. What were the events you would describe as defining moments in your life?
The beauty of the history dialogue is that participants are thankful for the disclosure it allows, and also that you, their advisor, want to understand what they’re all about. There is so little we can get from somebody’s name, age, profession, job title and net worth. A short dialogue about their personal history reveals much more.
As they tell their stories, you will begin to see people’s powerful emotional “souvenirs.” They will likely tell you about their humble beginnings (“Look from what and where I came”); their pride of achievement (“Look at what I’ve accomplished”); and the lessons they’ve learned (“Look at how I’ve grown along the way.”)
The first question you’ll want to ask your clients is what their first job was. I once asked someone what kind of work he did as a kid. At age 10, he said, he began selling Christmas trees door to door. Then he realized he could follow up with Christmas accessories and later Christmas cards. His business was humming along every holiday season until he ran into inventory problems—his supplier couldn’t keep up with him! This young entrepreneur had a mind for business at a young age and understood inefficiency when he saw it. Such information can be useful to you.
When you ask clients this question, they’ll tell you tales of shoveling snow, dishwashing or waiting tables. People that grew up in rural settings will talk about getting up at 5 a.m. to do chores. Others will talk about helping out in the family business or mowing lawns.
You’re not just gaining information by asking this question. By asking them about their youth, your clients can review their early resume and the humble beginnings from which they may have sprouted.
What Did Their Parents Do?
I once asked somebody this question and they replied, “My dad was a teacher and my mother stayed at home to raise us; somehow they supported 12 children. To this day, I don’t have a clue how they held it all together on a teacher’s salary. I have the ultimate respect for my parents for what they did and how little they had to work with. I can’t imagine someone being able to do that today.”
Another man told me that his father, a radio journalist, supported a family of seven on a very thin budget. The father had become resourceful and learned to fend for himself after he and his mother were abandoned by his own father. Those lessons were passed down, first to the man I met and then to his children.
As you can see, such questions lead you into the economic periphery of your clients’ lives. No matter how financially successful they are now, people are emotionally anchored to the economic experiences they had growing up, and will volunteer whether they grew up “poor” or “decidedly middle class” or “pretty comfortable.” When they talk about their parents, they show you the fabric out of which their money values were cut.
Now ask clients what events in their lives were the defining moments, which is a key to understanding their motivations.
You will likely hear amazing stories, both about losses and windfalls. One man told me about a fire that burned down his parents’ house when he was a young man. Another spoke about his father losing his family farm. One woman told me that her husband had died on their honeymoon after a drunk driver hit them.
Others told me about how they inherited land or immigrated to the United States.
It might be an isolated event or may be a significant period of history that the person lived through. Whether it is a traumatic event, a change in fortune, a loss, or a survival story, these recollections are shaping your clients’ lives—defining who they are and what they become. Few stories are as important for you as you are building relationships with them.
And the advisor who asks these questions most likely has a client for life.