FROM THE BLOG

This is one of the most challenging times to be an advisor, not due to market volatility or a recession. Why? You are in a high-trust position in a low-trust society. Trust is the foundation of the financial advisory profession. Clients entrust you with their life savings, retirement plans, and financial legacies. However, we live in a time of declining institutional trust, skepticism toward experts, and heightened consumer awareness. In this environment, you must be proactive in establishing and maintaining trust. Here’s how:

1. Transparency
Clients today demand full transparency. You should openly disclose fees, compensation structures, and investment strategies. Providing detailed explanations in plain language—not industry jargon—can reinforce trust and ensure clients feel informed and empowered.

2. Consistent and Honest Communication
Trust erodes in silence. Proactive communication, whether through regular portfolio updates, market insights, or check-in calls, reassures clients that you are engaged. When delivering bad news, honesty is crucial (and do it in person or over the phone—not by email). Clients value truthfulness over sugarcoated reassurances.

3. Education and Empowerment
An informed client is a trusting client. Instead of just offering financial solutions, you should educate clients about investment principles, financial planning strategies, and risk management. Taking extra time to explain choices can deepen trust.

4. Leveraging Third-Party Credibility
You should seek professional designations (such as CFP®, CWS, or CIMA®) and affiliations with respected industry organizations to reinforce your expertise and ethical standards.

5. Admitting When You Don’t Know
Clients don’t expect you to have all the answers instantly. They do expect honesty. When facing an unfamiliar question, the best response is: “I don’t have that answer right now, but I will find out for you.” This approach strengthens trust by demonstrating humility and dedication to accuracy.

6. Building Personal Connections
Beyond finances, clients want to feel understood on a personal level. Remembering key life events, celebrating milestones, and demonstrating genuine care for clients’ well-being fosters emotional trust, which is just as critical as professional trust.

7. Leading by Example
Your reputation extends beyond financial advice. Maintaining a strong ethical compass, being involved in the community, and exhibiting consistency in personal and professional dealings all contribute to trustworthiness.

8. Follow Through
Most of all, do what you say you are going to do when you say you are going to do it. Trust isn’t built overnight—it’s earned over years of consistent engagements with your clients.

Trust isn’t just given—it’s reinforced through every interaction, every commitment kept, and every moment of honesty.

Until next time,

Hilary Pluemer
Chief Administrative Officer

Posted by Prospera Financial