Are You Getting the Best Value from Your Wealth Adviser?

Eleanor Ng

Recently, I decided to sign up for a coaching program offered by SMU. It is a comprehensive course covering 4 modules where we are taught on the foundations of coaching leading to a Professional Certificate in Coaching. Module 1 was especially beneficial for me. I have learnt that to be an effective coach, I need to first be an active listener. Module 2 dived deeper into change management and building trusting relationships.

Why did I embark on this program? Do I really want to be a professional coach? No, at least not now. I did it because I believe that coaching is a good core life skill to develop. In many ways, coaching skills can be used in parenting, managing people or being a leader in various capacity. But for me, it is even more relevant as coaching skills can also be applied to wealth advisory.

How so?

Creating Awareness Through Self-Discovery

In Providend, our first meeting with clients is the Discovery Meeting. Before this meeting, clients are asked to complete a detailed document to consolidate their asset/liability position as well as their income/expenses. This information will later form part of the wealth plan to show their current net worth and cashflow situation. This is no different from what other financial institutions will do. What is different about us is that during the Discovery Meeting, beyond the quantitative information, we use coaching questions to encourage self-discovery of life purpose, values, and priorities. You see, we save and invest for the future but what we want our future to look like depends very much on our ‘’why’’ and not just the “what” and “how”. This has impact on the life choices we make and in turn influences our wealth decisions. That is why in Providend, we always say that in order to live a good life, first make a life decision before making wealth decisions.

As an example, for some retirees, owning a car may seem to be a luxury. Why need a car when you have all the time to travel around in public transportation? For one of my clients, he shared that he derives joy from ferrying his family around as this is an expression of his love through the time spent with them. In making provisions for his retirement, upgrading his car on a 5-yearly basis is factored in as one of his financial needs. This will take up 20% of his retirement lifestyle provisions. It may seem wasteful to others but not so for him as this wealth decision enabled his life goal.

In this regard, our wealth decisions really depend on the phase of life we are in because our purpose and life goals can change at different life stages. Some of these could be building experiences with our families or sending our children for an overseas education at the expense of delaying our retirement. Some financial decisions may not seem to be the best from a quantitative perspective but if it supports the clients’ life goal, they can still be good decisions.

Having clarity on the state of our life and wealth today will empower us to make smart financial decisions and take responsibility over the choices that we make. As a wealth adviser, I can use coaching techniques to help clients see these choices more clearly.

Motivating Clients to Act

Knowing what to do and doing it is very different. There is often a cost to delaying a decision, making too fast a decision, or even prolonging a wrong decision. This is especially so where financial matters are concerned. In our work with our clients, through good coaching questions, we try to help clients uncover the cause of this dichotomy between what needs to be and what is actually done. Discovery questions are asked to create awareness of what their money concerns are, life worries, relationship with money, habits and motivations amongst others. With these understandings, on an ongoing basis, we support our clients to make the best decisions for themselves which they may not otherwise make due to their past experiences. Through asking clarifying questions, we hold the space for our clients to think about these issues and be empowered to move forward.

One of my clients shared with me that she has a ‘poor man’ mentality which held her back from making finer lifestyle purchases although she could very well do so since she is earning a very good income. In her growing-up years, money was tight. She funded her own education through giving tuition. Her siblings would sometimes approach her to borrow money or she would be asked to help with certain family expenses. As such, she kept a very high level of cash with the strong desire to ‘help out’ should the family needed her support. Even though the last time this happened was more than 30 years ago, this experience has stayed with her till today. When she approached us, her concern was her fear of not being able to retire. Through discussions and coaching, she came to recognize the problem she has with her relationship with money. Through thorough analysis and working with Providend, she has since built up a healthy retirement nest egg through investment. She is also assured of her financial standing in support of her lifestyle goal. In fact, the analysis showed that she is in the position to retire now. With this insight, work to her is no more for income but rather to be mentally and socially engaged.

Preventing Our Clients from Making Wrong Decisions

A very important role that a wealth adviser does is to help our clients to stay invested. Every day, we are bombarded with news of the markets, opinions from economists and the like. We help our clients separate these news from what is helpful to what is unhelpful to their wealth plans. Although our firm provides regular communications on wealth management and investment to help our clients contextualize the issues at hand, nothing beats having a personal wealth adviser coach and assure our clients, especially in times of market turmoil. The most recent of such cases would be the sudden downturn in the markets because of the uncertainties caused by the COVID-19 pandemic. The coaching conversations has helped to keep clients stay invested and not make hasty decisions. For those of our clients who have put in more capital instead (and even those who have not), all of their portfolios have benefitted handsomely as the markets have more than recovered.

Many of our clients are also often prospected by financial institutions to buy products such as retirement income insurance, dividend yielding funds, structured products with leverage etc. All of them may sound very interesting with tempting propositions, but when clients check with us for an independent view, not only will we explain to them how these products work, their pros and cons, we will coach them into self-realising the trade-offs they have to make and whether they make sense in the context of their overall wealth plan.

Bouncing off Ideas and Regular Check-Ins

Having worked with our clients through the years, we have a close relationship with them. The regular conversations that we have about their families, work and their wealth plans put us in a privileged position to be able to support our clients through their life journeys. During the regular check-ins, our clients will update us on the things they are contemplating before they make any major financial decisions. Some of these can include upgrading their properties, early retirement, career changes etc. These conversations require us to deeply listen to their needs, aspirations and concerns. Sometimes, we may have to ask questions to help them clarify their thoughts so as to guide clients to ensure that their decisions are in alignment to their purpose and life goals.

Sometime ago, one of my clients wanted to retire early. The stress from working from home started to cause some health issues like heart palpitations, back aches etc. She feared not being adequately prepared to make that decision moneywise. While working with the client on possible changes in her lifestyle decisions, discussions on mental preparations and alternative options to full-time employment were also explored.

Who we are today is a sum of our experiences and the stories we tell ourselves. Understanding these experiences and stories, together with our life purpose and goals should provide the foundation on which our wealth plan is built upon. Providend incorporates coaching approach to our wealth advisory process to understand this context better before we build our clients’ plans. Doing this not only helps build deeper and lasting relationships with our clients, but it also supports them to make better wealth decisions.

This is an original article written by Eleanor Ng, Associate Director of Advisory Team at Providend, Singapore’s First Fee-Only Wealth Advisory Firm.

For more related resources, check out:
1. Let Your Financial Decisions Enable Your Life Decision
2. How to Know If You Are Financially Secure and Don’t Need a Job Anymore
3. My Reflection on the True Value of Estate & Legacy Planning

We do not charge a fee at the first consultation meeting. If you would like an honest second opinion on your current estate plan, investment portfolio, financial and/or retirement plan, make an appointment with us today.

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