Important Financial Planning Questions You Should Be Asking Your Clients
Knowing your clients, understanding what they want, and maintaining a good relationship with them is essential to keep clients coming back for your expertise.
No one person is the same. Everyone holds different views in life and has different goals to pursue. It’s not so different when it comes to financial planning—different financial situations, different financial goals and priorities, different outlooks on personal finance.
As a Certified Financial Planner (CFP), you need to have a comprehensive understanding of your client’s situation to deliver the right recommendations. You can achieve this by asking these important questions and actively listening to their responses.
Financial Planning Questions to Ask Your Clients
When you have a good picture of your client’s financial situation, you can better identify opportunities and potential challenges that may occur, which will help you create a better plan for them.
We’ll discuss some of the most important financial planning questions to ask your clients so you can understand their short-term and long-term goals better and, as a result, financial plans that serve your clients better.
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1. Opening questions
Opening questions establish rapport with your client. These questions are broad and basic in nature. It helps your client to open up and share more information about themselves, allowing you to establish their background and understand the basic facts of their financial situation. Here are some examples of opening questions:
Can you tell me about yourself?
What do you expect to get out of this process?
What are your priorities when it comes to managing your finances?
How do you manage your finances? Do you currently have a budget?
What goals have you set already?
2. Relationship-Building Questions
Relationship-building questions build trust and establish a positive connection between you and your client. Here are some example questions you can ask clients:
Why did you choose me?
Have you worked with a financial advisor before?
Do you work with any other financial professionals? (i.e. accountant, attorney, etc.)
How would you like to communicate with me and how often would you like to meet?
How would you like to receive information and updates about your financial situation and investments?
What do you want to achieve from this collaboration?
Who else do you want involved in this process?
Do you have any questions for me?
Asking about your clients’ past experiences with financial advisors or other financial professionals helps you understand what they like or dislike about those experiences. This knowledge can help you avoid mistakes that previous financial professionals might have done and build a better relationship with your clients.
You can also ask your clients about their expectations and how they would like to communicate and work together. Doing this can help you establish clear communication channels and meeting frequencies, and helps you find out how the client would like to receive information.
3. Financial-Based Questions
Financial-based questions help you gather information about your client's current financial situation and goals. By asking the right questions, you can gain a clear understanding of their financial position, and help them identify any potential issues or opportunities that may impact their financial well-being.
Some examples of these questions are:
Do you feel like you’re on track to meet your financial goals?
What do you feel is your most pressing financial need right now?
Do you have the most up-to-date data on your finances?
Do you think a financial plan would make your life easier right now?
Are you planning any big purchases in the near future, like a car or a house?
Are you planning for any other major life events?
4. Family Questions
Asking key questions can help you understand your client’s views on family finances and give insight into how they may impact your client’s financial goals and decisions. After all, family dynamics can play a significant role in shaping someone’s financial habits and priorities.
For example, if a client comes from a family where saving and investing were emphasized, they may be more inclined to prioritize those aspects of their own finances.
On the other hand, if a client comes from a family where spending and consumer debt were more prevalent, they may be more inclined to prioritize paying off debt and managing expenses. Take note, however, that you should not assume things and take them for a fact.
Additionally, asking about your client’s family can also give insight into other potential financial concerns, such as providing for aging parents, saving for their children's education, or maybe if their partner is not on the same page when it comes to financial goals.
Here are some examples of family-based questions:
Who are you financially responsible for?
What role do you want to play in your children’s and grandchildren’s futures?
What kind of legacy do you want to leave your family?
Do you have plans in place in the event that you are not able to financially take care of the family?
Are there any specific financial goals or concerns you have for your family?
Are you planning to provide financial support for aging parents or other family members?
How do you feel about passing on your financial values to your children?
Are you and your partner comfortable discussing financial matters?
5. Retirement Questions
Retirement is a major financial goal for many people. As a financial planner, it’s important to understand your client’s expectations and plans for retirement so you can provide the most appropriate advice and guidance for them.
For example, understanding your client’s desired lifestyle in retirement can help you make recommendations on other financial products or financial services that may be beneficial to the client, such as long-term care insurance, annuities, or reverse mortgages.
Knowing their plans and preparations for retirement, such as which retirement accounts they’ve prepared, will also help you identify potential roadblocks that may affect their retirement goals.
Additionally, if you offer estate planning or wealth management, knowing their lifetime financial and life goals will also help you with giving financial advice in this area
Here are some example questions you can ask regarding retirement:
At what age do you want to retire?
Have you been preparing for your retirement?
What kind of lifestyle do you hope to maintain in retirement?
What do you want your retirement to look like?
Are you planning to continue working in some capacity after you retire? If so, what kind of work do you envision doing?
What kind of financial foundation do you think you will need to support your desired lifestyle in retirement?
Are there any health-related concerns that you think might affect your retirement plans?
Do you have any dependents that you will need to support financially in retirement?
6. Lifestyle and Values Questions
Asking these questions can give you an insight into the client's priorities and values outside of finances. This information can be very helpful when creating a financial plan and recommendations that align with their current lifestyle. You’d like the financial plan to not only align with their financial goals but also support the important areas of their life.
For example, if your client values charitable giving and community service, you can include charitable giving strategies in their financial plan. Similarly, if your client enjoys traveling, you can recommend cutting back on other expenses so that they can continue to afford that lifestyle.
Prioritizing your budget allocation based on your client’s lifestyle and values will make sure that your client can implement the changes fairly easily.
We have compiled several example questions that you can ask your clients:
What do you enjoy doing outside of work?
What causes are important to you?
Do you do philanthropic work?
Are there any values that are important to you?
Are there any areas of your life that you feel are particularly rewarding?
What kind of education or personal development opportunities are you interested in?
What kind of community involvement or volunteer work is important to you?
7. Risk Questions
Questions about risks will naturally come up when you’re discussing your client’s investment portfolio. Other than knowing their risk capacity, as a financial advisor, it’s also important to have a clear picture of what kind of investor your client is. These two factors—your client’s risk tolerance and risk capacity—can help you make appropriate investment recommendations for your client.
Here are some examples of risk-related questions:
How do you define “risk”?
How do you feel about risk in general?
What loss in your overall portfolio would start to cause you concern?
Would you feel worse for selling equity before it increased by 5% or for not selling before losing 5% in value?
How important is it for you to preserve your capital?
Knowing your client’s risk appetite and investment philosophy is important to make sure that you’re creating an investment strategy that they can stand behind. If you’re also offering investment management for your clients, you should also make sure that you’re disclosing any conflicts of interest when you’re giving investment advice—especially when you’re a fiduciary.
8. Overall Wellbeing Questions
Asking questions about personal and financial well-being can give you a more complete picture of your client's overall financial situation.
Additionally, asking these questions can help you build a stronger relationship with your client. When clients feel like they are being heard and understood, they are more likely to trust you and to be more open to the advisor's recommendations.
Some example questions in this regard are:
Do you or your family have health concerns or issues?
Have you made provisions for long-term care?
What are your strongest feelings toward money?
What makes you happy?
Are there any areas of your financial life that are causing you stress?
How are you currently feeling about your financial situation?
Are there any major life goals that you are currently working towards?
Asset-Map Takes Care of the Financial Planning So You Can Care for Your Clients
Ultimately, financial planning is a relationship business. Your clients rely on you to create a financial plan they can actually implement. To create a plan that aligns with their life, you need to know a lot more about your clients than just the numbers.
These 8 types of questions will help you dig deeper to find insights that will help you form a plan that they’re actually happy with.
Incorporating these questions into your financial planning process will help you discover insights that will help your clients make informed financial decisions. Besides informational purposes, these questions can also give you an inside view of their decision-making process, making it easier to tailor the plans accordingly.
Make your processes—from discovery to analysis—more efficient so you can spend your energy providing the care that differentiates you from other finance professionals.
Asset-Map helps you simplify all your processes so you can provide a 5-star experience for all of your clients.
Find out how our visual map helps you with your discovery process. Better yet, schedule a demo here so you can ask all your questions live.