How to Connect With (and Keep) Female Clients: Kathleen Kingsbury

September 18, 2014 at 10:02 AM

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Freud asked the question: "What do women want?"

Kathleen Burns Kingsbury, wealth psychology expert, has the answer — at least what women want from their financial advisors (it's what she calls a "pleasure boost."). Kingsbury knows what men want from their FAs, too.

Focusing on money personalities, she coaches advisors and other financial services professionals on how to retain clients and increase profitability.

Many FAs lack good communication techniques big-time; but Kingsbury, 48, founder of KBK Wealth Connection, can give them the scoop on how, when and what to say in building a strong, ongoing person-to-person connection.

A former psychotherapist in private practice for 15 years and before that a bank examiner commissioned with the Federal Deposit Insurance Corp., Kingsbury blended her two specialties and became a certified professional co-active coach (CPCC). In 2009, she launched KBK.

It was just after the worst part of the financial crisis. Clients were struggling with painful emotions about money and needed to talk. Kingsbury took the opportunity to help advisors connect with them on a deep level.

Ever since the meltdown, clients have expected more from their advisors when it comes to understanding their psychological needs about money, Kingsbury says.

Author of "How to Give Financial Advice to Couples: Essential Skills for Balancing High-Net-Worth Clients' Needs" (McGraw-Hill-2013), among other books, Kingsbury, who has a master's degree in psychology, is a faculty member of the Investment Management Consultants Association's Certified Private Wealth Advisor Program and teaches psychology in financial planning at Bentley University.

Among her clients are AXA Advisors, Commonwealth Financial Network, Merrill Lynch Wealth Management and TD Ameritrade Institutional; and she is a frequent speaker at industry events, such as the Million Dollar Round Table 2014.

ThinkAdvisor recently reached Kingsbury in her Easton, Massachusetts, office to talk about how advisors can not only reach clients but retain them.

ThinkAdvisor: What do men want from their FAs?

Kingsbury: On average, men want advisors to be experts and to "fix it." The advising world is tailored to be fix-it focused. That works great for a man who walks in and says, "I have a financial problem. I want you to fix it." The advisor fixes it, and everybody's happy.

What do women want from their advisors?

The No. 1 complaint I hear from women clients is that their advisor doesn't listen very well. Women want to talk about emotions more than men do. If a woman doesn't have a chance to talk about the [emotional side] of the fix-it process, it leaves her flat. Women tend to be more focused on connection.

This can be challenging when advisors are working with a male and female couple.

It's a dilemma: They have to balance his need to fix it and her need to talk about it.

What's the biggest mistake that FAs make in dialoguing with clients?

[Typically] they're more transaction-based than relationship-based in their selling. But I can empathize with the advisors: When you have a supervisor asking how much you've produced this week and measuring your success by productivity, it's very hard. If you invest more in the client relationship upfront, though, you'll tend to have very loyal clients. How can advisors improve connecting with clients?

What makes a producer a top producer is having good communication skills. Often advisors have a long agenda they want to get through; and instead of putting it aside and meeting the client where they're at — asking what's on their agenda — they go into their own list. They need to actively listen to clients and really understand where they're coming from.

Please elaborate.

A client may be thinking, "Can I take care of my mother financially if she gets ill?" or "How am I going to be able to afford to retire?" But often advisors are talking about return on investment and portfolio strategies. So there's a disconnect. Advisors are living in the world of investments and financial plans, whereas clients are living in real life.

How do you remove this barrier to effective communication?

Advisors tend to forget that clients don't live in the financial world and that they need to speak to them in plain English — not because clients aren't smart but because they don't live and breathe finance the way someone in the industry does. Advisors need to meet clients around the things that are happening in their lives and how they relate to their financial situation — what is considered the "soft side" of finance.

In other words, FAs need to be empathic.

Yes. They have to put themselves in the client's shoes: What are the emotional benefits of the service I'm providing and how can I talk more about the non-technical aspects? That will help me achieve my goal, which is developing a successful financial plan and strategy for the client.

You say that advisors need to employ active listening. What does that entail?

It's listening to understand — not listening to sell. A lot of sales programs teach how to listen in order to gather information to position yourself for a sale. That's not true active listening. Active listening involves asking open-ended questions, and then really paying attention to what the client has to say, often reflecting back what you've heard so that you make sure you understand. It's taking the time to interview clients almost as a journalist would so you can understand their perspective.

But isn't selling product an ultimate goal of most FAs?

The advisors who are most successful want to do well, of course; but at the same time, they're interested in having highly satisfied clients. Once you really go out of your way and show them you care, they're likely to refer more people to you, they're more loyal and they can tolerate the market's ups and downs because they have an ongoing relationship with you.

It makes sense that building loyalty helps to retain clients.

It does so if you can wow them.

What's "wowing them"?

Letting them know that you've thought about them and are interested in their lives above and beyond your professional relationship. It's almost like they're walking down the red carpet — making sure they know that they're special and important and that you care in an authentic way. If you're not authentic, then it's not going to work. You have to do it in a way that's true to who you are. Where does behavioral finance — how people interact with money and investments — come into play?

Behavioral science shows that often even well-educated investors act irrationally when strong feelings are triggered and emotions get the best of them. Therefore, they aren't going to make the best financial choices in the short run.

How can advisors help?

They need to understand some of the common errors that people make according to behavioral finance. The advisor's job and value is to be that rational person who can talk about feelings and help by working around [and with] them. They need to understand what's going on emotionally and then try to help the client stay the course. This is why financial advisors need financial advisors: because when it's your money, you can get overly emotional.

You've written about a physiological difference between the male brain and the female brain. If that's so, how does it affect investing?

The financial advisory field was created for men by men, so it's tilted toward the male gender. An advisor needs to consider two factors about what makes a woman, a woman and what makes a man, a man. One, the way we're hard-wired — the brain; the other is the way we're socialized.

What do neuroscientists say about the brain?

They've found that 99% of the brain is the same in the male and female. The 1% difference is that women are hardwired for connecting to other people. Men don't get the same pleasure boost from connecting. When women connect, their pleasure centers in the brain light up more than they do in the male brain.

How does that apply to the financial advisory scenario?

Sometimes advisors get frustrated with a woman client who comes in and wants to talk and tell stories, when all the advisor wants to do is get to their own agenda. But they need to keep in mind that that connection is giving the woman a pleasure boost and that they're better off appreciating it and building the relationship rather than trying to skip over it.

When, for instance, do advisors ignore women's need to connect?

When they're trying to talk about the technical aspects of retirement but aren't willing to lean in to the idea that maybe the woman is worried about being a bag lady, or if she gets sick first, who will take care of her husband. She's connecting money and emotions, and she wants to talk about it.

But many male advisors may feel funny about dealing with a woman's emotions because what they've been hired to do is invest money.

Here's an example of how connecting emotionally with female clients can help the advisor. Once, when I was giving a talk, a male advisor in the audience asked, "I have widowed female clients, and they often start to cry. How can I make them stop?" All the women and the sensitive male advisors kind of cracked up. But I realized he was coming from a really honest place. I explained that when women cry, in general it can be quite helpful and that if he really wants to help such a client, he needs to tolerate whatever he feels uncomfortable with and let her cry. Widows are frequently pressured by friends and relatives to switch to their own financial advisors. Where does that put the existing advisor?

In many cases they're at high risk of losing the account. You've probably heard that 70% of women fire the couple's financial advisor within one year of the death of their spouse. But if you invest the time upfront, you won't lose those clients during difficult family transitions. You have to lay the groundwork now, however.

Why do so many women change FAs after their husbands die?

A large part of it is because advisors aren't working with these women and building trusting relationships until their partners are ill or already deceased.

That's not planning ahead. What's a better way?

When you're doing an investment strategy for a couple, you need to meet with both people and develop a relationship with both. If you do that, when a family transition occurs, like a death, divorce or illness, you're in a much better position to retain that account.

Many women say that male advisors patronize them. That turns them off.

Most advisors are well intended. It's not like they're purposely trying to be biased against women. But they're so used to being in the old boys' club that they neglect or don't fully understand how some of what they say might [negatively] impact the female client. They need to be more aware and tread lightly.

To retain clients, is it a good idea to have a relationship with a couple's adult children, if there are any?

Yes, but the first step is to engage in a relationship with the significant other. It gives you an opportunity to talk about wealth transfer and what the couple wants for the future. Then you can to bring in the next generation to have those conversations. If you show how much you're able to help the parents, it helps retain the assets during difficult times.

When the FA is interfacing with a newly widowed woman, should a meeting be scheduled with the children as well?

It's really helpful to bring in one or all of the adult children because sometimes the widow — or widower — is emotionally overwhelmed. It also helps the advisor to get to know the kids better and therefore retain the assets. It's a win-win all around.

Why is there such a big need for coaching FAs in communication techniques?

[Firms'] training programs are very technically focused. Advisors don't receive enough training and coaching on the non-technical aspects to learn how to effectively communicate and understand what people want from the relationship.

But by this time, haven't firms realized that they need to educate advisors about this critical area?

It takes a while for [traditional ways] to shift. Some firms are starting to train in communication skills. Since the financial crisis, clients are speaking up a little more and demanding advisors who are more client-centric. Once that comes from the clients, it will make a difference in terms of the bottom line. So firms are starting to pay more attention.

What's your final thought about client retention?

Be transparent. Know that you don't always have to be 100% perfect. That is, advisors need to learn that if they make a mistake or if a client is unhappy, if they [exert] the extra effort to work through that or apologize, if appropriate, they can build trust, foster relationships and help clients stay longer.

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