The role of a financial advisor extends far beyond number crunching and investment strategies.
At its core, the advisor-client relationship is built on a foundation of trust that transcends spreadsheets and market trends. In an era where financial decisions carry profound implications, establishing and nurturing this trust has become paramount.
In an interview with Action! magazine, Rob Crnkovic, co-founder of investments platform CapIntel, discussed how financial advisors can cultivate trust with clients.
Click on the video below to watch the full interview.
Transcript:
We've done a lot of end-user research and really tried to get to know the retail customer. And from the retail customer’s perspective, you want to get confidence for an advisor, [but] building confidence can be really difficult.
A prerequisite for confidence is trust and establishing trust with the retail client, which is always a challenge. Again, we went to the research – it was a lot of help from a lot of firms and talking to a lot of retail investors.
The biggest and easiest way to build trust is A) with personalization and B) with education. The ability to talk to somebody in the context of their outcomes or their goals, and really explain to them why you're suggesting certain strategies, goes a long, long way in building trust with folks.
We had a hypothesis that the investment proposal was massively valuable real estate – and it turned out again, from the research, that was correct.
Eighty-one percent of people believe that investment proposals are material in making a decision. The thing about business as usual with investment proposals, [the industry] sends a whole bunch of quantitative information – and quantitative information without context can be really difficult. The buying process actually is, you get that investment proposal, you go home, you show it to your husband, your wife or your partner, and then you come back. So it's got to live on its own.
As soon as you start to add personalization and qualitative information – explaining why you're suggesting certain strategies – trust scores go through the roof, and it encourages a really valuable conversation with the advisor that often leads to more confidence and more money moving.
Don't forget to educate your clients. Explain to them, teach them. They're really willing to learn and they really want to understand the process and be on that journey with advisors.
