Indecisiveness can be a formidable obstacle on the client’s path to financial success. Guiding clients through their uncertainty and helping them make confident decisions that align with their goals can be challenging. Shawn Tay, CFP, a three-year MDRT member from Singapore, shares more about the complexities of client indecisiveness and the techniques he uses to navigate such situations.

Based on Tay’s experience, a client’s indecision can often be attributed to three main reasons, namely:

The lack of prior knowledge or experience in making financial decisions
The fear of making a wrong decision
Trust issues toward their financial advisor, or the lack of trust in the financial services industry as a whole

He believes that as financial advisors, it is important to remember it is completely natural and expected for clients to experience such emotional roadblocks. He respects that every client’s decision-making process is different and views it as his role to handhold clients and guide them in navigating these roadblocks. To assure clients struggling with indecision, he advises the following:

1. Listen actively and ask more open-ended questions to fully understand the depth of their financial situation, their unique life circumstances and their personal reservations and concerns. While discussions of measurable goals are important, it is also important to listen out for their emotional motivations or roadblocks. This will demonstrate to the client that you are concerned not only about the situation and task at hand, but also about their needs and concerns as a unique individual.

2. Provide transparent education and guidance on financial concepts before making a recommendation. Communicating clear, easy-to-understand explanations of different financial products and services will help your client weigh the pros and cons of different options based on their individual goals and risk tolerance. Being transparent in your opinions and advice also builds trust in the client-advisor relationship.

3. Break down big decisions into smaller steps. When clients are overwhelmed by the complexity of making financial decisions, it can be helpful to break down decisions into smaller, more manageable steps. Focus on prioritizing the most important decisions first and provide clients with clear action steps to help them move forward. By taking a stepwise approach, your clients can gain confidence in their decisions and build momentum as they achieve small wins on their journey to reach their financial goals.

In a recent holistic personal financial planning session, Tay discovered multiple pressing concerns and needs expressed by his client. These included the addition of newborn children to the family, tight cash flow with high discretionary expenses, uncertainty about the investment portfolio and outdated insurance coverage. To address these various concerns can be overwhelming for clients, Tay outlined a strategic plan by listing down the action steps starting with the easiest or most important actions to be carried out. In this case, he started by relooking at his client’s investment portfolio and rebalancing the portfolio to address his revised risk tolerance (due to changes in life stage) before moving on to other priorities such as advising his client to reduce certain unnecessary discretionary expenses and set up a separate bank savings account for wealth preservation and accumulation. "By working together to identify your client's concerns and providing targeted support, we as advisors can help our clients make informed decisions that align with their individual values and priorities," he stresses.

He also notes that balancing a sense of urgency while respecting clients' decision-making process is a crucial factor in overcoming their indecisiveness. “It is essential to communicate to clients the importance of taking action when it comes to planning for the finances,” he emphasizes. “This helps clients understand the potential consequences of delaying important financial decisions and how it could impact their long-term financial goals. However, it is important to do so in a sensitive way that does not pressure or rush clients into making decisions before they are ready."

Another strategy Tay implements is providing clear and concise information while narrowing down the best possible routes for clients. “As much as information and choices are important, I try not to overwhelm the client with irrelevant or excessive information,” he explains. “If there are five possible routes for my client to take, I demonstrate my expertise and experience by considering their situation and narrow the choices down to the best two or three routes, which I will then present in greater detail. This eases some of the decision-making burden on my client.”

Tay recounts a recent experience he had with a client who had been deliberating between different life insurance plans. “After listening to my client’s preferences and concerns, I ruled out the selection of an investment-linked life insurance policy and proceeded to discuss the possibilities of term plans and traditional whole life plans instead. By analyzing his personal net worth and cashflow statements and identifying potential stress points in his personal financial statements, we decided the best approach for him was to pick up a low-cost term plan to address the need to cover a large liability for a known period of risk. By educating and guiding my client on the rationale behind the recommendation, we were able to swiftly decide on what was most suitable for him and speak to the logical and emotional motivations on why he should act now to protect his downside. Timely follow-ups on pre-determined dates eventually led to the decision making and close today,” he shares.

Tay concludes, “Ultimately, the key to balancing the need to provide clients with a sense of urgency around their financial goals with the need to respect their decision-making process is to approach each client as an individual.” By providing targeted support and personalized guidance, advisors can help clients make informed and disciplined decisions that will align with their goals and values.

Contact: MDRTeditorial@teamlewis.com

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Cracking the code of client indecisiveness