11 Financial Planning Questions to Ask Clients
Asking the right questions can facilitate a more holistic conversation between financial planners and their clients. Open, honest communication is crucial to building trust and creating a financial plan that will have the greatest impact. By focusing on the client as a person and not solely on the numbers, you can reach financial goals more easily. The best way for clients to understand and adopt the financial planning process is to discuss in terms that are important to them and speak their language.
If you do a Google search on what financial planners should ask clients versus what clients should ask financial planners, you’ll find nearly six times less material. This doesn’t minimize the importance of what planners should ask clients in any way.
In fact, the planner/client dynamic is a relationship, which means it is a two-way process. And in order for it to be successful for both parties, the planner needs to ask the right questions.
I am a Certified Financial Planner ® practitioner, who has both asked client questions and has been asked questions from a financial planner as a client. I can appreciate the emotional aspect that arises from either side and realize the importance of acknowledging it.
Successful financial advisors or planners do not focus solely on questions like “What will be your monthly living expenses in retirement?” Conversations need to be more nuanced, with respect for each client’s feelings toward and experiences with money.
These emotions come into full force for some clients when there is extreme stock market volatility, such as the market reactions to the COVID-19 pandemic.
The following are 11 questions financial planners should consider when speaking to clients.
Understanding a client’s relationship with money will help inform decisions about his or her finances and evoke a deeper, potentially more constructive relationship between you and the client.
Are You Currently Seeing a Financial Planner or Have You Seen One in the Past?
The goal here is to learn what clients valued about their previous relationship with a financial planner and what aspects of that relationship could have been improved.
Ask open-ended questions, such as, “If you don’t mind me asking, can you share any experiences you have had with a financial planner?” This will get the client talking and allow you the opportunity to ask what they liked most about the relationship.
Can You Describe Emotions You Had About Money When You Were Growing Up?
My personal views about finances were mostly shaped by my mother. She is a retired banker, and my brother and I couldn’t leave the kitchen table in middle and high school until we balanced each of our checkbooks. Whereas my husband immigrated here from Pakistan in high school at 16, and because of all the major life changes as a teenager, his parents bought things for him like a high-end stereo system even when they were struggling financially.
What Is Your Preferred Method of Communication?
Knowing whether a client communicates primarily via email, phone call or text message can shed some light on how the client operates on a daily basis and how personable they would like the relationship to be.
To better gauge clients’ needs, you’ll need to learn about their lifestyle and the things or people that are most important to them.
What Keeps You Up at Night?
Do You Have an Accountant, Attorney or Insurance Professional?
The answer to this question could indicate if the client is a do-it-yourselfer or delegates responsibilities.
What Are the Top 5 Financial Planning Topics that Are Most Important to You?
Examples of answers I’ve received include legacy, budgeting, retirement planning and college savings.
What Are Your Passions and Hobbies?
Find out if your clients like to travel, paint or volunteer in their children’s classrooms (even virtually). Some hobbies can be more expensive than others and require more of a client’s budget.
Who Are the Most Important People in Your Life?
It’s important to know who matters most to your clients, so you can help them plan to leave money for one or more beneficiaries if that is a goal. It also helps you understand whether the client has either an emotional or financial support system in their network.
What Causes Are Important to You?
Knowledge of a client’s involvement in volunteer work, hobbies and causes close to his or her heart is invaluable when forging a bond with a client. When you asks this question and really listen to the answer, the client feels valued, and you gain crucial insight that bolsters your ability to refine the financial plan accordingly.
Retirement is a big part of one’s financial picture, and it’s never too early to start planning for it. You’ll need to understand your clients’ expectations for after they retire.
What Do You Do for a Living?
Knowing how your clients make money will provide insight into their financial stability as well as their overall well-being.
Will You Continue This Line of Work in Retirement or Do You Envision a Second Career?
Seek to understand whether clients want to work during retirement to stay social and active or because they are concerned they’ll run out of money.
How Do You Picture Yourself in Retirement?
Visions for retirement are as unique as the clients themselves. You will need to understand each client’s personalized retirement lifestyle in order to properly plan for their financial security.