Clients often seek financial advice with the hope of receiving validation that their current approach is sufficient. They want reassurance that they are on the right track, even if their methods are suboptimal or lack a comprehensive long-term strategy. Their desire for validation stems from a fear of the unknown and anxiety around change.

Though this scenario is not uncommon, it is just one of the many potential reasons clients stall or are reluctant to give financial planners all the information needed for a holistic view of their financial lives.

Some call this “client inertia” because it is a phenomenon that plays out as a cycle of client resistance and inactivity over time.

Understanding the Root Causes of Client Inertia

A deep-rooted desire to maintain the status quo and a wide range of individual contexts and emotions are typically at the core of client inactivity. Changing established patterns and routines can be daunting, even when the potential benefits are evident.

Some clients may be reluctant to share complete information about their financial situation because doing so would expose potential shortcomings or areas that require adjustment. By concealing certain details, they can rationalize and justify their existing habits and practices, avoiding the discomfort of acknowledging the need for change.

Becoming familiar with the psychology behind client resistance can be a great place to start when faced with client inertia. Doing so also reminds financial planners that change tends to come in stages and hardly happens overnight.

Manifestations of Inertia During and After Onboarding

Client inertia can manifest in several ways during onboarding and soon thereafter in the fact-finding process. As the relationship may be new, clients may be more likely to limit the information they share, only providing what they consider essential despite requests for more comprehensive data.

However, client inertia is not solely about withholding information that could portray a full financial picture. After the fact-finding phase is complete and a tailored plan is presented, clients may resist implementing the recommended changes. Even with a thoughtful strategy, the inactivity that initially hindered information sharing can persist, making it challenging for clients to take the necessary next steps to achieve their long-term financial goals.

Strategies for Overcoming Client Resistance

To combat resistance, financial planners can employ strategies to help clients work through their fear and anxiety and to begin to trust. Building trust is a core strategy when alleviating a client’s concerns and helping them feel more comfortable.

Financial planners can build trust by focusing on empathy. Understand the client’s situation and how they see it. When clients feel understood and heard, defenses may come down. That can be a suitable time to highlight how advice may be less optimal without full transparency.

Partners in the Client’s Financial Journey

Here are some other specific actions financial planners can use to partner with clients who face overcoming inertia:

• Share the commitment: Jointly commit to collaborating on tasks and responsibilities to split the accountability between you and the client. Knowing you’re there for them each step of the way, clients may feel more empowered and motivated to follow through on the agreed-upon plan.

• Inspire them to use the portal: Lean into the value of a client portal by providing simple tasks like uploading bank statements or instructing them on how to bookmark the portal on their computer.

• Establish baby steps: If a client needs to put a certain amount of dollars per month into a plan and that feels difficult, start with a smaller amount and increase it over time.

• Recognize small wins: Celebrating small wins along the way can help make the process feel less daunting. Move quickly to the next step to maintain momentum.

• Create a custom sample client and client deliverables: Showcase your full capabilities in other areas, such as retirement planning, tax optimization, or estate strategies, by showing them sample client scenarios and outcomes.

• Customize portal views: When showing the client portal to the client, display the metrics and data that are most meaningful and motivating to that client.

• Remind clients of the benefits of reaching their goals: It is easy to lose sight of a goal that may be years away. Remind them what achieving the goal will feel like emotionally.

Reduce Friction When Gathering Information

Many clients find gathering financial documents and information tedious or intimidating. As a financial planner, it is essential to reduce the friction associated with this step in the relationship by examining every step and asking yourself, “What can I do to make that step easier?”

Here are some ways of helping reduce the friction when gathering information and documents from the client:

• Simplify the process: Test it yourself or with your team to ensure clients easily provide the necessary information.

• Use client portal technology to your advantage: Leverage the benefits of the client portal experience by using secure file-sharing platforms and document management systems to streamline the information-gathering process. Make it easier for clients to act by setting helpful custom defaults.

• Offer bite-sized instructions: Some clients may struggle with gathering the right documents because they did not know the name of the document or where to find it. Be proactive in offering small bits of information in the right place and at the right time.

Fear Is Not Nearly as Motivational as You May Think

Some planners may cautiously appeal to a client’s sense of fear to nudge them beyond their comfort zone, but they must avoid damaging trust by doing it carefully. Planners should be certain that what they say is true, meant to inspire, and will not accidentally push a client further away. It is often better to focus on your expertise and create a supportive environment for clients to overcome inertia gradually than to try to shock them into acting.

Fear is not an effective long-term motivational tool. Until a client is comfortable, a planner may see them struggle with delays, anxiety, and skepticism.

When Inertia Persists Despite Your Efforts

Even after employing empathetic language, showcasing deliverables, and trying different approaches, some clients will inevitably withhold information or resist change. It may manifest in their delaying opportunities to provide requested information or in subtler ways such as keeping assets held away.

In these situations, it is crucial to ensure you have exhausted all options before conceding. Reflect on whether the client relationship still benefits both parties, considering the value you can provide with the limited information available.

Ultimately, you must accept that overcoming client inertia is not always possible, regardless of your efforts. Maintain the perspective that despite these limitations, you still provide value through your expertise and guidance.

Client Inertia and its Solutions are Personal

Overcoming client inertia is not a one-size-fits-all endeavor; nor is it something a financial planner can do alone. It requires a multifaceted approach tailored to each client’s unique circumstances and client buy-in. However, by understanding the root causes of the inactivity and employing empathetic communication, advisors can create an environment of trust and transparency, encouraging clients to embrace change and take ownership of their financial futures.

Ultimately, overcoming client inertia is not just about achieving goals; it’s about fostering a lasting partnership built on trust, open communication, and a shared commitment to long-term financial well-being.

As you begin to see a client respond to your nudges, there are other focused strategies you can use to help break down their barriers and help them to act. For more insights, check out the article: Moving Clients to Action with Motivational Interviewing.

You may also be interested in...