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Who Is The Most Important Person To Read Your Reports?

I ask new members of staff a question.

“Who do you think is the most important person who will read our advice reports?”

They look at me strangely, smelling a trap. After a few moments they hesitantly go for the obvious answer.

“The client?”

I shake my head, perhaps a little sadly. Confused, they think on, then shrug their shoulders.

“It is,” I say, after a suitably dramatic pause, “the solicitor that the client might appoint in 5 years’ time to take legal action against us.”

If ever you feel like you can’t be bothered to properly write up your meeting notes, or are tempted to cut and paste the next report because it’s pretty much the same advice as the last one, read the case studies on this web site.

A large number of their ‘success’ stories seem to be people who say they didn’t understand the investment risk. A number of the case studies suggest that investments were encashed after a downturn in the market – which, of course, has the effect of crystallising the loss. The phrase “I told them I could not afford to lose this money” also comes up repeatedly, though none of the cases resulted in the client losing all their money (only some, and only because they cashed in).

Many of the claims seem to be against advisers at banks. One wonders whether this is because the advice from banks is more easily challenged or whether they are perceived to be a softer target, more likely to pay out.

I’m all for someone who has been sold something that was not appropriate to their circumstances to have access to redress. Wrongs must be righted.

It does mean, however that we have to write our reports not for the client to understand, but to protect ourselves from the likes of Goodwin Barrett.

This is unlikely to result in reports that are more client friendly – something that the FCA is very keen on (as are we, the adviser community, are we not?).

One solution to both issues is to include objectives in reports, using the clients own words. If we help clients to understand themselves better then we should uncover some deep motivations and maybe even dreams. As Eva suggests in her comment to my recent article on that subject, how many reports have you read which state “Your objective is to transfer all your pensions into a SIPP for us to manage.” That’s not an objective, that is your solution.

It’s a tricky balance trying to satisfy the (at times) conflicting demands of clients and the lawyers. The best method is to seek client motivations and repeat the words that the client used in the report, in quotation marks.

It would be nice to one day be able to say that the client is actually the most important person to read our reports.

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