+1.416.689.7882 support@jimruta.com

There is one key change you have to make if you want to learn from these challenging times. It’s not particularly new but it is now particularly important. “Written engagement is not optional.”

Actually, written engagement has been a regulatory and contractual requirement for some time. But, is it happening?

I did some informal research recently. I asked my last fifteen audiences this year, totalling more than 1,000 advisors in Canada and the US, this question, “What is the first step in the traditional six-step, financial planning process?”

Would you believe that only one person out of 1,000 spoke up with the right answer? Only one young woman could come up with “Establish the Engagement in Writing”. Just one. I was so impressed because I was some ten talks into the series that I had to ask how she knew. “I wrote my exam yesterday,” she said.

Despite that, I’m hopeful others knew. Still only one right answer came up among many others – “Set goals, gather facts, set priorities, organize information…” All good, but not the first step. For all the CE credits, designations and training today, I can’t believe that the very first step in the process remains a mystery to so many.

A follow-up question discovered that maybe only as few as 20% of advisors actually have a written engagement anywhere in their process at all. It’s more than a mystery, it’s not happening.

The reason engagement is especially critical today is that clients are searching for advisors they can trust today more than ever. Integrity is their number one criteria for an advisor. Getting the deal straight before they have to make a decision gives them more comfort and confidence. Communication builds trust. Written engagement helps make that happen.

And, I don’t just mean handing over a form letter written by some lawyer somewhere and hoping the prospect will read it. They will not. Read it with them as part of your initial interview. They have to understand it if it’s to help anyone. Take advantage of your fiduciary obligations and make your relationship better.

If you are obliged to use a form letter, consider an additional “relationship engagement letter” that explains the “soft facts” of your new relationship. Email me, I have one.

And, don’t just plop one on the desk well into the process looking for a signature. That raises suspicion and eats away at trust.

Share This