Closer Client Relationships Drive Greater Growth and Satisfaction

According to FPA, financial planners who engage in “know your client” behaviors gain deeper personal fulfillment from many more of their client relationships.

The level of interpersonal knowledge financial planners have about their clients directly correlates to their potential for success, according to a new “Know Your Client” survey report.

The Financial Planning Association created the survey report in collaboration with Capital Preferences and T. Rowe Price, seeking to identify and promote the behaviors and techniques financial planning professionals can leverage to learn more about their clients. The report suggests some 80 behaviors that advisers may implement to boost their interpersonal relationships with clients. 

According to the survey report, helpful “know your client” behaviors range from speaking broadly about client’s life goals to promoting frank discussions about how clients view their family dynamics and relationships. The survey report says financial planners who engage in these behaviors gain deep personal fulfillment from 60% more of their client relationships. At the same time, this group of advisers sees substantially higher referrals and growth, to the degree of enjoying 56% higher client willingness to recommend and 72% higher net client growth rate.

FPA says planners who actively identify misalignment between what clients say and what their behaviors show—and constructively resolve those gaps with their clients—report higher success on a variety of metrics. Notably, the survey found that planners who pinpointed this disconnect had almost triple the client growth rate compared to those who did not and double the referral rate.

Other findings show “know your client” financial planners spend more time directly engaging their primary clients’ partners and adult children, and they are 40% more likely to discuss aging-related lifestyle transitions and cognitive decline with their clients and their families.

“This study clearly redefines what it means to ‘know your client’ and how understanding their behaviors is highly correlated with solidifying strong, lasting client relationships built on a foundation of understanding and trust,” said 2018 FPA President Frank Paré.