Nearly 83 percent of clients and 84 percent of advisors agreed that it is vital for an advisor to understand a client's values and priorities – before they can give effective financial advice. It is this idea that underlies the trend called "Life Planning," or any kind of planning that focuses on the actual desires of the client.

Why are client values important to you? Values are actually subconscious power sources. So, think of values as the things in your client's mind that motivates her decisions and gives her energy so she can perform the activities necessary to bring her values to life. Knowing that, doesn't it make sense that you (as the advisor) would need to know what your best clients' values are?

It should be obvious from that research that in order to move your client relationships to a deeper level, you need to discover what their values are. There are three ways to learn that:

1. Ask. This is called the "criteria-elicitation question." There are a few variations of this question that have become popularized, but let's look at the structure of the question: "What's important to you about ________?" Fill in the blank with the appropriate situation. For example:
   1. "What's important to you about leaving a legacy?"
   2. "What's important to you about your children's college education?"
   3. "What's important to you about retirement income?"
   4. Note: money is rarely ever listed as a value.
2. Listen. In the course of a conversation, a person will express his/her values. Simply initiate a conversation about a specific topic, something of importance that the client wants to fund or save for. As he/she mentions values, just write them down. Or, encourage the client by asking, "Why is that important to you?" If you don't include the "to you," the client will give you a general and hypothetical answer, instead of a personal one.
3. Behaviors. Behaviors show you how the person acts out and brings his values to life. If a client claims a value but does not put it into action, then it's not really a value. Let's look at a few common values:
   1. Education. Most people list education as one of their top four values. If a client lists education but does not continue to learn, then education is not a real value.
   2. Retirement income. The Boomers are starting to retire, and will certainly need retirement income, but has it been a value to them leading up to retirement?
   3. Asset accumulation. This is a value to advisors, but rarely to clients. And, for retirees, isn't the income more important than continued focus on accumulation?

* If you need better listening skills, or better people-reading skills, please go to the bottom of this article and use the Feedback form to send me a personal note.

Negative Values vs Positive Values. The research conducted in the early 80s by Rodger Bailey at IBM found that approximately half the population looks to accomplish goals and the other half looks to avoid problems. So, think of goals as positive values and problems to avoid as negative values. If your client gives you an indication that something always bothers him, write that down. It means he has a value to avoid.

For example, what if he's very serious about not running out of money? That's a negative value. What if he is determined to have enough retirement income for the remainder of his life? That's a positive value. In your mind, they might be the same thing, just worded differently. Wrong!

People who look to accomplish goals tend to rephrase the language and put negative values into positive wording. Do not do that! Here's why:

1. It's presumptuous and arrogant. We've seen well-meaning people do this for many years. They simply do not understand what damage they're doing. We've seen that many people confuse goals and values. A goal is a target that needs to be phrased in the positive. A value is the power source that dives the person to achieve the goal. If I say that one of my values is to not run out of money. Then, my goal might be to start saving.
2. Simple damage control. You really don't know what the client means by any values he names. For example, Family is one of the top four values for Americans. What's your definition of a "Family"? Mom-dad-one child? Mom-dad-seven children? Mom-mom-no children? Dad-dad-extensive nieces and nephews? The surviving members of a military combat unit? When you parrot the client's values back to him in his exact language, you're doing damage control. It is not necessarily important that you completely understand that person's definition of that value – unless you're doing therapy or counseling with him.
3. Rephrasing a value changes the meaning completely. Realize that value, worth and importance are not in your mind; they're in the client's mind. The way the client phrases the value is exactly how you need to phrase it back to him. A value that's been rephrased has lost its energy source and cannot be used as a motivator. Thus, the related goals will likely never be accomplished.
4. Rephrasing a client's value gives the client reason to question your wisdom. That question acts like a catalyst and changes the relationship. That change equates to withdrawal of trust. It goes from trusting to doubting. And that is the precise point at which the credibility stops. When that happens, you can probably wave good-bye to any referrals from that person.

In Conclusion

Trust has been identified as paramount by just about everyone in this industry who ever wanted to move up and start to work with clients who have higher-net worth. Problem is, most authors and consultants can't define trust in practical terms and they can't tell you (in real-life practical terms) how to gain it with your clients.

Trust is typically placed on some kind of magical-spiritual pedestal. For all practical purposes, that renders it unobtainable. We think that's nonsense. The way we work is to find such ambiguities in the business world and make them clear. We know from years of study, research and experience with psychology that trust is simply a "weigh station" on the road to Credibility. It's a benchmark in the relationship-building process where you can assess the quality of your relationship. And, it's the result of a simple process.

Your Reward

If you've read this entire article, then you probably want to know more about how you can increase your Credibility. If that's right, do this: copy this paragraph and paste it into the Feedback form below, I will send you our Report "10 ways to Improve your Credibility." Be sure to include your contact information! What a great way to move into Spring!