For an advisor who is rarely having conversations with clients about “simple” topics, extra steps should be taken to mitigate communication risks.
The mnemonic device C.A.R.E. can be a useful reminder for advisors about short-term situations that require increased attention. If a topic is Complex, Ambiguous, Rushed or Emotional, take extra time to ensure you and your client are on the same page with these three tips.
Before you meet with your client, run through your agenda. Do any of the topics you plan to discuss hit on the C.A.R.E. acronym? For example, market volatility can be a very complex and emotional conversation, so consider making a list of the points you need to address with your client, so that if the conversation gets derailed, you can bring it back and make sure you cover everything you need to.
During your conversation, always verify your client’s understanding of, and agreement with, what you’ve said. However, if you use a phrase like “Does that make sense?,” your client may interpret that as an insult to their intelligence—that they can’t make sense of what you’re saying. By rephrasing how you ask, you can make clients more comfortable when confirming their understanding. Try asking, “Am I explaining this clearly?” instead. If the client doesn’t understand, you’ve implied that it’s your fault, not theirs.
The biggest risk is when you and your client have come to an agreement, but each of you walks away from the conversation with a different idea of what that agreement is. To avoid this, summarize the conversation with your clients before you part ways. Highlight what your key take-aways were from the meeting, and ask your client to do the same. This allows you both to further work through any potential miscommunication and ensure you’re on the same page.
There are many things that can get in the way of communication, and therefore can hinder a solid advisor-client relationship. But if you take C.A.R.E. with these three simple tips, you may find you are able to avoid many of these hurdles and communicate more effectively.