There’s a lot of discussion about the loyalty and trust that clients have for their IFA. We like to think it is because we do a good job, although some might say it is largely due to inertia.
This maybe an unworthy analogy, but isn’t it like the doctor/patient relationship? The client has to trust the adviser with so much personal information, way beyond just the financial, that to go elsewhere and go through it all again is pretty lengthy and painful process.
Ok, telling someone how much you are worth is intimate but telling them of life plans that you may not have shared with anyone else is akin to confiding your closest secrets. These are the ‘soft’ facts that matter, aren’t they?
There is a very unusual relationship between adviser and client – almost a pact. And trust is the key.
Sometimes that intimate knowledge can be a real burden to the adviser. Some years ago we ran a final salary scheme and the long standing, globe-trotting CEO was retiring.
I had known him for over ten years so naturally I had all the facts when he wanted to discuss his retirement. I also knew his wife (of more than 30 years) well and she had spoken many times about how she was looking forward to having him at home and spending much more time with him. He had spent much of his career out of the country on a ridiculously busy schedule.
I arranged lunch with them both about a month before he retired to wish them well and finalise the pension details. Mr CEO said that Mrs CEO couldn’t make it so it would just be the two of us (the first step towards another soft fact I wasn’t expecting).
We had a very pleasant lunch but when we got onto discussing the post-retirement plans I had a bout of sudden and severe indigestion.
Mr CEO, who had planned his retirement very well, took me into his confidence and swore me to secrecy. His solicitor had drawn up various documents which would be presented to his wife the day after he retired. These would include a transfer of their home and half of his invested assets to her.
You see, whilst globe-trotting, Mr CEO had developed a parallel life in the US involving a new partner and a 12 year old son.
On retirement day plus 1, he was getting on a plane to the US and his other life, never to return. He had assuaged his guilt by making ‘proper’ arrangements for his existing family.
The only person other than his new family to know this was me. His poor wife who had been waiting patiently for years was completely oblivious. Client loyalty and confidentiality can carry a big burden.
Now that’s a soft fact that hits hard.
Simon Goldthorpe is executive chairman of national advice firm the Beaufort Group.
