For the last 18 or so months, much has been written about the new Department of Labor (DOL) “fiduciary standard” that will soon be required for those working with retirement accounts in the financial services industry. No longer will a financial advisor be able to make recommendations that are only “suitable,” but rather all advice must be in the client’s “best interests.” This fiduciary standard rule will require more transparency regarding fees, how investment advice is given, and additional documentation at every turn. For those of us with certain licenses and designations, most of these requirements have been a fact-of-life for some time. For others, this is uncharted territory that may be threatening.
Unlike some in the business, I see the new DOL rule as a gift. Now before you stop reading, let me explain. As I have detailed in my book, Cadence of Care, embarking on an advisor-client relationship requires a deeper understanding of the human experience and each client’s life story. The more we know about a client, his or her life experiences both positive and negative, the better we can help them and us discover how best to serve them.
A significant part of that investment in the relationship starts with us. What are we prepared to reveal about our life story? Who were the formative persons who shaped our values, biases, fears, and dreams? In what ways do the collision of these client and advisor stories shape what we hear and how we make planning recommendations going forward?
In this three-part series, I invite you to consider three gifts the DOL rule offers. First, we are given the gift of being distinctive in a sea of similarity. Advisors who embrace deeper discovery, asking harder questions, spending more time with clients where they live and work, investing energy in crafting customized strategies, and who act in the client’s best interests will never lack for business. Being distinctive does not mean being trendy, offering premium coffee blends during client visits, or playing spa music in the office. Those additions to a client experience may be your style. But, when the client has a death in the family, a visit with a genuine hug and expression of sympathy will go further than a mocha latte.
The same is true when it comes to learning the client’s life story. A review of someone’s bank and investment statements, a Social Security report, insurance policies held, real estate owned and related debt assumed may only give us 25% of a client’s life. People do not live in their statements nor find meaning in a mortgage. What makes an advisor distinctive has as many expressions as there are clients. For one, it may mean a periodic visit to a client’s business. For another, a call to a client’s aged mother. To a third, a hospital visit when the wife in a client couple relationship has surgery.
Advisors who distinguish themselves in relational ways not only communicate care, empathy, and life investment, but convey the most important message of all: you matter to me more than all the business I have or will ever do for or with you! Let the level of care you offer be your distinctive, remembered gift to those you serve. In Part 2, I will unpack how creating community transcends all other aspects of business. In the meantime, I’d love to know your thoughts about the new DOL standard.