The first step in the financial planning process is collecting customer data.

By Ryan George, Marketing Director at Docupace

Onboarding new clients is a notoriously expensive and time-consuming process for financial advisors, but it’s necessary for a successful relationship. Here’s how to make sure you’re gathering the right information and using it as effectively as possible.

Investors want a personal perspective on their finances

As consumers navigate an ever-expanding array of customizable retail products, they seek the same finely personalized attention in professional services. And that goes for financial planning – 68% of Americans say a personalized financial plan would be an extremely or very important factor in determining whether or not they would sign with a particular advisor.

Part of this change is generational. A baby boomer who has little or no debt and plans to plan for retirement and inheritance will naturally have different goals than a millennial who came of age during the financial crisis of 2008. And even within of a subset of younger investors, gender can make a difference in wealth management strategies: Millennial women are twice as likely as their mothers earn more money than their domestic partners.

Because highly personalized advice is so critical to the success of any financial plan, the Certified Financial Planner Board of Standards lists duty of care, defined as “acting[ing] with the care, skill, prudence and diligence that a prudent professional would exercise in light of the client’s objectives, risk tolerance, objectives and financial and personal circumstances” as an essential part of the fiduciary duty. This bond between the client and the adviser is the foundation of all future action and must be treated with the attention it deserves.

The most vital customer information is not always quantitative

Although young investors are more comfortable discussing money than their elders, financial matters still demand a great deal of empathy and tact from advisors as they tackle a mountain of information. Sifting through income, expenses, dependents, retirement, and all the quantitative characteristics of a client’s financial situation requires a significant investment of time and energy at the outset of the relationship.

And the information financial advisors need isn’t just about dollars and cents – the CFP Handbook outlines several qualitative factors to consider, including:

  • Health
  • Life expectancy
  • family circumstances
  • Values
  • attitudes
  • Expectations
  • Earning potential
  • Risk tolerance
  • Objectives, needs and priorities
  • Current course of action

Information like this can’t be squeezed into a chart or calculator, but it’s just as necessary to make smart financial planning decisions. The foundation of a successful relationship depends on an advisor’s skillful understanding of what matters most to each client.

Plus, on a more human level, gathering this information early on will lead to stronger advisor-client relationships later on. Advisors can nurture their clients by communicating timely inquiries and congratulations when previously reported events occur. Knowing that an older client has just welcomed their first grandchild, for example, or that a younger client has recently completed their first semester of college opens up critical conversations about financial planning updates. .

Keeping track of so much granular information for each client on an advisor’s list can seem like a daunting task, and it’s a lot bigger (and more important) than scribbled sticky notes or quick phone reminders. can handle. Collecting disparate information in a centralized system makes it easy to stay on top of client milestones, as well as quickly recognize when additional or updated information is needed.

Collect customer information digitally with PreciseFP

During recent webinar Discussing client engagement, PreciseFP Founder and President Don Whalen, CFP®, pointed out that most advisors don’t turn to client-facing tools to increase their productivity — but when it comes to to collect customer information is exactly what they need.

PreciseFP’s FactFinder tool allows advisors to create fully customizable client questionnaires, starting with an extensive library of templates, so they can focus on exactly what they need to know to build the best financial plan possible. And, in addition to gathering the right information and omitting what doesn’t apply, FactFinder allows the advisor to showcase their strengths and demonstrate a superior level of customer service.

“I would say it’s somewhat offensive to send a generic questionnaire to a recent college grad and to send the same questionnaire to a retired couple,” Whalen says. “The needs are very different.

Plus, instead of doing laborious paperwork or entering data themselves, advisors can digitally send out an intake questionnaire for clients to complete. “We like to say your client does the data entry for you, Whalen jokes. Once returned, PreciseFP automatically flags incomplete fields or items that need more attention, saving advisors valuable review time for only the most critical parts of the process.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Louisa R. Loomis