The Art of Guidance: Using The Right Tools

Dive into the critical role of financial advisors as guides, not heroes, in their clients’ stories. Discover the significance of identifying each client’s unique archetype and how this understanding is crucial in guiding them effectively. Learn about the various metaphorical tools that can be utilized to facilitate behavior change tailored to individual client needs. This episode provides invaluable insights into customizing financial advice to align with diverse client profiles for more impactful and positive outcomes.

Podcast Transcript

Reese Harper: [00:00:00] But let’s say we’re that and you were new experiences. You were. The global traveler could, which you are, and I’m your financial advisor. I gotta be really careful about how my tool set looks,

Carl Richards: Yeah.

Reese Harper: Carl’s not going to receive me very well if what I’m offering him. Looks more like a weapon.

Or a crowbar

Carl Richards: Or a

Reese Harper: a lock pick or a box,

Carl Richards: Yeah.

Reese Harper: but he’s probably gonna love something that looks a little bit more like a map or maybe a compass. I think Carl would like a compass.

Welcome to Ella mentality. This week, Reese and Carl are back in the studio to talk about the importance of becoming a financial guide for our clients. And the metaphorical tools that may be needed depending on the client that you’re working with. Stay tuned here, what tools you can use to guide clients toward better behavior change. And as always, if [00:01:00] you’d like to learn more about elements, go to get elements.com/demo, to schedule a time to meet with a member of our team.

Now. Let’s get onto the conversation with Reese and Carl.

Reese Harper: Carlito.

it’s been many moons. Literally you’ve been traveling the world and we haven’t hung out. I don’t think we’ve been in person since like a month.

I bought this box. Of cards

it’s called Storyteller Tactics. It’s been excellent trainer for me. To learn and one of the tactics that was very compelling to me was the hero and the guide

you’ve been doing a bunch of like media stuff lately. You’ve been doing a lot of PR work. You’ve been doing a lot of like shaping of storytelling. I want to just talk about this hero and guide story. Cause I feel like it’s so applicable to financial advisors in so many ways, . So can we just talk a little bit about that? Just to orient people to, even the thing we’re [00:02:00] talking about here, before we go deep, And I want to pick the part, pick a part of the story

Carl Richards: Yeah. So I, there’s a couple threads that provide context for the way I’ve approached it. And one is just that well, maybe the first one’s the most personal, it was probably like three or four years ago. I started realizing that I was no longer in the hero’s journey, the classic storytelling model.

I was no longer Luke Skywalker. And there was a whole period of like

Reese Harper: in your own career, in your own

Carl Richards: my own career, I was like, I’m no longer in, at least in parts of it and most of it actually and it’s, it happens naturally. I just reached out to some younger advisors who were like 30 in there, 35 to 40, like.

10 or 15 years younger than me and I’d called them the young Jedi’s just as a sort of joke This was a [00:03:00] hard realization for me because I always I mean I think we all want to be the hero in certain parts of our lives and my work had been very public And I thought, I was like, Oh, like I would show up at a speak engagement.

I was like, it’s about me, like that kind of thinking. And then I slowly started to realize like, it wasn’t either back then. It wasn’t, it was never about me. Maybe specifically, it was no longer about me. Like even at a speaking engagement, it was like, no, it’s much more about the audience. And then I started realizing, like, , I don’t want to be.

Luke Skywalker anymore and this, there’s a whole line of thing.

So I think there’s a lot there we could play around with in terms of the role of an advisor.

Reese Harper: So yeah let’s hit on, let’s just summarize what you shared to make sure it sinks in and we’re not just like pounding people with new information. What I’m hearing is get clear [00:04:00] first about who is the hero. Of their own story. The client

Carl Richards: Who’s the main character as

Reese Harper: main character here and I think we all agree with that.

It’s remarkably difficult sometimes for me as a financial advisor to not want to be the hero.

I often find myself wanting to be the hero of my client’s story and I have to remind myself that I’m just a guide. I’m

Carl Richards: Let me ask you real quick. How does it show up? Cause I think it’s easy to get confused about this.

Reese Harper: Yeah. I can just speak for myself and my own mistakes. I think I have very specific financial preferences. I think I have a really specific DNA and I project that sometimes onto the people I talk to. Sometimes I try to make my lessons, their lessons, and that could be really dangerous because I’m a different person that came from [00:05:00] a different place of privilege than Either less or more, than the person I’m talking to.

And I have different knowledge and different life experience and I’ve got different lessons that were applicable to those circumstances, both naturally as they just happened in my life and based on my values.

Normally my advice becomes remarkably similar to my own life advice. That I would have given myself, which isn’t always. What they need at the time. It’s not what the data would suggest. It’s not what their values would be inclined to choose. It’s what my experience was wanting for them. And I think that’s risky.

I thought we’d do a little bit of a values connection here, and then if the person comes to you with a really strong set of values towards. New experiences and change like my friend carl richards i’m sharing this example because i think it actually is quite applicable to you [00:06:00] carl as a client or a person that would want new experience what would i what would you want to be told if that really is your value what is what would you want to be told by the guide i’m just curious if you could imagine that for yourself.

Carl Richards: Now,

Reese Harper: someone, let’s say if you really do value new experiences with your money over all else, what are you hoping that guide provides you with?

Carl Richards: that’s a really good question and yeah, mainly because I’ve thought about it so much because

Reese Harper: yeah. And what if you value safety and security?

Carl Richards: yeah, see it’s really interesting cause we as a family are on the extreme end of not, of money and flow, like nobody would have told us that moving to New Zealand for four years was a reasonable idea. Nobody like [00:07:00] 99 financial planners out of a hundred would have said, that’s probably reckless.

Reese Harper: Yep.

Carl Richards: And it was worth

Reese Harper: it was.

Carl Richards: every single penny. And I would do it again. And my wife would do it again. And our kids would do it again. And we don’t know what that will mean 10 years from now. And so, but is it a job, we have a financial planner who’s really good at saying, I hear you and I just want to make sure you understand some of the trade offs and just for like 30 minutes together, let’s put on these like future looking trade off hats.

And then I want you to take them off and get back to the way you’re living right now. But I, and I’ve told every financial planner we’ve hired, which is just three over the years. I’ve told them that I don’t think they would ever get, I said, I hope that I would never fire you for being really direct with us, but I would definitely fire you if you didn’t, like we partially need a drill sergeant

Reese Harper: Yeah.

Carl Richards: to be really direct about the things that we, that The [00:08:00] trade offs that we’re making, I was going to use consequences of decisions, but just the trade offs that we’re making so that we can then make a decision.

And then once we make a decision, what the job of the financial planner is as long as you feel like you’re still on a winning team, I can see a point. And I’ve had this happen as a planner. I have said, I no longer want to play on this team. I, the decisions you’re making are, I don’t see a way that this works well, and I’m sure it will, but I don’t really want to be involved.

I’ve only had to do that once. may be a point in an advisor’s career where they have to be like, I’ve, we’ve tried, I’m just not the right voice. I’m not getting through. It doesn’t seem like things are getting better for you. We feel pretty good about our lives. So what I want is a planner who will say, I’ve heard you.

I’ve pushed around the edges. I’ve asked questions. Now you’ve, you guys have told me, I think I’ve heard you right. This is what you want to do. I’m going to help you build the best strategy to do that. And then when we get new information, maybe we’ll tweak and adjust. Does that make sense? Cause I’ve wondered about that.

If I really want somebody to [00:09:00] go, bro, this is a disaster. You can’t, you have to, I don’t

Reese Harper: yeah, I think that’s what’s tricky is if I like, let’s say my values as a financial advisor now start to creep up my values of safety and security and risk aversion. Let’s just say that happens to be me. I’m actually not safety and security and risk aversion, but it’s quite the opposite for me.

But let’s say we’re that and you were new experiences. You were. The global traveler could, which you are, and I’m your financial advisor. I gotta be really careful about how my tool set looks,

Carl Richards: Yeah.

Reese Harper: Carl’s not going to receive me very well if what I’m offering him. Looks more like a weapon.

Or a crowbar

Carl Richards: Or a

Reese Harper: a lock pick or a box,

Carl Richards: Yeah.

Reese Harper: but he’s probably gonna love something that [00:10:00] looks a little bit more like a map or maybe a compass. I think Carl would like a compass.

That’s what that mine would look like for

Carl Richards: an adventure

Reese Harper: because like, because what I’m going to do is I’m going to want to. There has to be some true North, right?

As a financial advisor, it can’t just be like, let Carl not know what’s going on. Like at some point true North. If he’s in New Zealand with 10 bucks left and he asked me for a hundred grand to put in a new hot tub and I’m like, sorry, you only have 10. I gotta be managing to something.

So compass, but like, I don’t think he’s looking for a way to get ahead. I don’t think he’s looking for things that look more like a paintbrush and a canvas and a compass and a map, but it’s definitely not like a weapon. It’s not armor. It’s not a padlock. Definitely not a lock pick or a crowbar.

So there’s just a lot of different tools that I think are our words [00:11:00] feel like to people. And I’m talking all of these tools are words I’m not even talking about products, and you can imagine what it would look like if I were talking about products. I’m just talking about words, and they matter.

If I tell Carl this is the right and wrong way, or this is the right and wrong way, it’s just not going to feel like validation at all. It’s going to feel like judgment. And then, when it does I have lost my opportunity to change Carl’s behavior towards a positive next local optimum because he’s not feeling accepted and validated.

He’s feeling like I bought a, I brought a crowbar to a compass party. That’s how it feels. So I thought I would share that with you. Cause for me, that last couple of weeks, Carl, it’s been, I’ve been thinking a lot about that concept and I knew you’d have some stuff to say. What’s your reaction?[00:12:00]

Carl Richards: Yeah. That you’re pointing to one of the reasons I think this craft is so beautiful is because it is like Tim Maurer, buddy, Tim Maurer says all the time, personal finance is more personal than it is finance. And so, yeah it’s, that’s exactly right. Like I. We, in dealing with clients, sometimes it’s really easy to dismiss like one spouse is like the dreamer.

They’re just uninterested because they don’t love your spreadsheets.

Reese Harper: Yeah.

Carl Richards: I think that’s like a really almost like stereotypical example of where this, keeping your values off client’s plans would hit. Like. Oh, they’re just not interested. Well, no, that’s just because you’re using a different set of language and tools than is helpful to that specific person.

Right. And so painting, somebody is disinterested because they view money [00:13:00] completely. This is interesting. I was in for the 50 fires podcast. I had chip gains on and chip and Joanna are very different. And chip, like he said to me, he knew from a very young age. That he felt drastically differently about money than anybody he knew.

And it wasn’t until college till he found somebody else that felt the same way. So the whole time he felt like he was doing it wrong. Like he was bad. Like there was some and nothing could be further from the truth. Cause he just, he was like, I just viewed money as easy come, easy go. It’s a tool to impact people.

So I’m just going to spend it on people. But he’s really glad that sometime Johanna came in and said, Hey, we got to have a little more discipline on this thing. So there’s this beautiful dance. I think that goes on. That’s really cool. That’s why I think being a financial planner is one of the best jobs in the world.

I think this metaphor that we’re starting, we started at the high level today talking about heroes and guides.

Reese Harper: We jumped down a [00:14:00] level now so you can see different people with different values need different tools in order to take the next step towards behavioral change. You can’t just, if the goal really is to help people feel better, to help them feel more present, to help them feel validated, safe, and actually have better results, better outcomes, we’re going to need to start giving them a tool set that helps address the values that they hold so dearly.

And that’s not always. The same for every client. So when we think about these tools, I just want you to think about software. I want you to think about reporting. I want you to think about the way you craft emails. I want you to think about the way you trade, how your investment philosophy could perhaps impact the story and the narrative that you’re going to share.

Maybe for one of you, active management is precisely. What you need because [00:15:00] your client is the radical change agent, the disruptor the person that wants to break the rules. If you’ve got a clientele like that, good luck telling them to just keep rebalancing with that S and P 500 index fund.

They’re not going to like that. And I don’t think that it’s worth fighting that battle over. I don’t care if active management doesn’t overperform or outperform. I care about the client’s savings rate. I care about time in market. I care about exposure to equities over time. Like these are the real issues.

And so your product selection, your marketing selection, your custodial choice, your software selection, everything needs to be oriented around this client who you have nailed. You understand them. Now, if they’re a traveler like Carl, if they’re a disruptive change agent, like the person I’m thinking of in my head, if they’re a person that [00:16:00] just value safety and security above all else, these are different consumers, they need different tools.

If you really want to change behavior, you can’t. I don’t think Carl, you can get there by just, Using the same hammer with every person there. It’s just not the same.

Carl Richards: Yeah. One thing I’ll just mention on that is there’s also nothing wrong with building the business where you define this is how I deal with people. And I only want people who feel this way. Given that you only need a hundred, given that you only need a hundred, but you should just be very clear with somebody who fits is outside of that.

You just simply say, I love you. You’re amazing. And it’s not a good fit. And it’s not you. It’s me. And I actually have a friend who’d be really good, but don’t take them on. And then there’s the other approach, which I think is equally valid of like being really good at adapting to different people’s styles and both are totally fine.

Just be clear about what you’re choosing. I was never good at the adapting thing. I just have too many fancy feelings. So I was like, no, I’m only taking on clients [00:17:00] this way. And I knew I only needed a hundred. So I, but both models are really valid, right?

Reese Harper: Yeah. And I know that we’ve been all over the board on this. I’m just going to insert the take compliment what you just said, Carlman insert like one connector line. Just to bring this analogy kind of full circle. I’m going to give you six tools to think about in your brain and that the essence of the difference between each of these tools. I’m not going to tell you what Nicole and I are going to unpack them completely.

We’re going to have to do that a future date. want you to think about the one I came up with was for Carl was compass. Think about what your communication might look like if you were using a compass as the metaphor for your service model to someone whose values were like Carl’s someone who valued new experiences and travel and exploration.

Another person this disruptive change agent we talked about just want to throw that I was like someone who’s is not just an anti status quo. They do like radical change. They want to disrupt things in there. That’s their energy level. [00:18:00] I want the tool I want you to think about for these people.

is a crowbar. I want you to think about how messy it is sometimes to do things that they want to have done, to get things done that are hard and that are difficult requests. Some clients like this are sometimes the occasional client that just wants to own TFLO for whatever wild reason they want to this week, or, they want to have a doubly shorted position against the U S treasury. I can’t tell you how many people I’ve had to interact with this frame of reference. And they have become great clients over time. Great clients. And I’ve had radically improved behavioral transformation that I’ve seen in their lives because I didn’t hand them a compass from the beginning. I gave them the crowbar and they, that’s what they wanted.

And I just think that in some cases you run the risk of. [00:19:00] Not helping someone when you try to force something into a situation where it’s not going to move them towards validation. If you validate first, I’m just speaking from experience, I think people are more likely to change than if you give them something you think they want and then hope they accept it.

Usually it’s better to give them what they want and then take the next step. In my experience, if you really believe that they should take a different step, if they really need to make a different step. So other items, books, think about your gift to certain people as a book, the type of person that might value a book.

What does a book represent? What kind of values comes out of a book? This is a story writing model that is a really intentional reason. This group has identified a book as a critical item. Padlocks. What do you think about padlocks as a, as one of your. Service model could look like canvases, just an empty canvas.[00:20:00]

And then I want you to think about it as a weapon, something to survive with. Right. These are interesting. And Carl I just want you to wrap up here, bring whatever you’d like to, but I like the idea of people. Considering themselves a guide, understanding the value of their customer, deciding how you want your service model to feel that matches up well with that archetype.

And then work on your messaging. Then work on your words, once, in that order. And I’ll let you wrap up, but I just really enjoyed this conversation, so thanks.

Carl Richards: No, really. I’d really love to say is amen. But one quick thought is just remember this too, as a practice, right? Like you can’t, just like you don’t expect your client, like you can’t expect clients can’t expect from you a perfectly drawn 30 year line. You can’t expect to know.

So practice, go try what you think. Like next time you in a client meeting, listen for what is it exactly this client would like, [00:21:00] what’s the appropriate tool. How do I make sure they’re front and center in their story, that this is their plan, not my plan. Like I’ll just practice and give yourself tons of grace in the practice because we all.

We’re all just stumbling through this together. This isn’t meant to be self help. It’s meant to be an adventure journal. So we’re all on the adventure together. So cheers. Thanks, Reese.

Reese Harper: That’s awesome, man. Thank you. You guys have a good one.

Thanks for listening. If you’d like to learn more about elements and how you can use it as a guiding tool for your clients. Go to get elements.com/demo to learn more. Cheers.

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