shows what those dimensions are, moving clockwise from the top:
The sections below provide just a brief summary of how each of the five domains influences the likelihood of follow-through with your advice.
Financial History and Circumstances: The specific domain of finance has associated challenges that are not seen in other fields. Clients come to you with a lifetime of individual and collective experiences with money, experiences that have contributed to their sense of relative financial competence and confidence. The challenges in this domain include dealing with factors largely internal to the client (e.g. family legacies, personal values, financial literacy) as well as external realities (e.g. access to funds, market cycles, changing life circumstances).
Advice Characteristics: No matter what area of behaviour change we might be considering, there will be certain features of the advice that will influence people’s willingness to follow it. Adherence is greatly affected by such things as the pleasantness or complexity of the tasks we prescribe, the time requirements for implementation, and any associated need to delay gratification. As you will learn, much financial advice can be hard to swallow because of some of these general advice characteristics.
Client Characteristics: The same piece of advice that one client finds easy to implement may require gargantuan effort from another. This is because of differences in such things as energy levels, motivation, outlook, and intellectual abilities. By understanding such influences and tailoring your advice accordingly, you can play a large role in ensuring that clients are truly ready to begin and to persist with their change attempts.
Team and Advisor Factors: How you behave with clients will have a direct bearing on their receptivity to your recommendations. By learning about such things as the need to reduce language complexity, listen more attentively, and relate with greater warmth and less judgment, you and your team will come to understand the critical role you play in increasing adherence.
Social and Environmental Factors: Our clients do not function in a vacuum – they are part of a complex social and cultural network that greatly influences their behaviour, often to a far greater degree than we do. It is important for both client and advisor to try and identify such influences so that they can be harnessed or mitigated accordingly.
Each one of these five dimensions of adherence exerts its own influence on follow-through, but none of them exists in isolation. Each domain interacts with the others, increasing or decreasing the likelihood that your clients will act in alignment with agreed-upon recommendations. In real-world practice, then, the FACTS model of adherence looks less like a uni-directional clock, and more like a spider web or a dream catcher:
There is a tendency for professionals from all walks of life to place heavy emphasis on the factual correctness of their advice, and to then blame the client when things don’t happen. The FACTS model corrects that unhelpful oversimplification. My hope is that you will return to this diagram with a spirit of curiosity and openness any time that you encounter adherence challenges in the future.
Refuse to be surprised
Upon learning that I am a psychologist, it is not uncommon for people to say something along the lines of, ‘I bet there’s nothing that surprises you anymore about people.’ Oh, yes there is! Two decades into this line of work, I am still routinely gobsmacked by the ridiculous, tender, grasping, harsh and thoughtful things our species is capable of. But the one thing that does NOT surprise me anymore is the difficulty all people have in bridging the gap between their good intentions and the actions that will accomplish their aims.
The authors of Changing for Good3 (a classic book on behaviour change) claim that, at any given time, only 20% of us are ready to bridge that intention–action gap. That is, only one in five people who freely admit to having a problem is truly committed to taking corrective action on it in the immediate future. Once this minority begins the journey towards goal achievement or problem resolution, they are usually then beset by additional challenges that further reduce the likelihood of success. With this in mind, then, non-adherence is best understood as the norm, not the exception. From here on in, you, too, should refuse to be surprised by the emergence of non-adherence; in fact, you should anticipate it, in order to head it off at the pass.
Advantages of giving advice that sticks
Why is it important for you to get better at helping people complete an agreed-upon course of action?
There are the obvious client-relevant reasons:
1. If they don’t adhere to the plan, clients may court some serious troubles: impoverished retirements, family disputes, legal troubles, bankruptcy, etc.
2. When they do adhere, clients are more able to reach deeply cherished goals: seeing the world, making charitable contributions, moving out of their parents’ basement.
3. Clients’ self-esteem and sense of integrity are diminished when they don’t keep their promises. Non-adherent clients frequently become dispirited and embarrassed by their lack of action.
4. Clients who feel bad about themselves and their lack of follow-through are less likely to attend subsequent appointments or comply with additional requests. They often go AWOL and fade silently away. Non-adherence begets non-adherence.
Then there are the factors that more directly affect the advisor:
5. Adherent clients have lower drop-out rates. It is much less work to keep existing clients for the long term than it is to have to continually recruit new ones.
6. Non-adherent clients can pose logistical, relational, or even legal problems for an advisor. They require more frequent phone calls and e-mails to nudge them along; they call more often in a panic (once their procrastination has reached crisis proportions) and demand immediate attention; they miss key deadlines and fail to provide legally required documentation.
7. Clients who are positively engaged with their own financial plans tend to be more satisfied clients who refer friends and family members. Non-engaged clients rarely do so. Non-adherence thereby has very real financial implications for the advisor.
8. Advisor satisfaction increases when clients are keeping their commitments, and decreases when they’re not. Let’s be honest about this: Some clients take a toll on us. They leave us feeling stressed, inadequate, worried, and frustrated. In the words of the American spiritual writer Anne Lamott, such clients are enough to ‘make Jesus want to drink gin straight out of the cat dish’. The more effective we can become in helping clients make important changes and avoid regrettable actions, the more we’re doing for our own well-being. (Plus, the cat gets to keep its dish. Everybody wins.)
And finally, there are regulatory issues:
9. As I write this book, the Fiduciary Standard is
