Guest post: Five Tips for Delivering Bad News to Clients

Everyone struggles with delivering bad news to clients–and financial advisors have had to deliver plenty of bad news over the past couple years. 

That’s why I felt excited when I discovered that Kathleen Burns Kingsbury, the author of this guest post, can help advisors manage difficult communications with clients.

Five Tips for Delivering Bad News to Clients
By Kathleen Burns Kingsbury, LMHC, CPCC

Delivering bad news to your clients is not easy. It often stirs up uncomfortable emotions–for clients and for you. Learning how to deliver troubling news effectively in conversation and in writing newsletters is the key to maintaining good relationships with your clients in good times and bad. 

Here are five tips for delivering bad news more successfully: 

1. Sandwich the bad news. Use the following analogy to guide you. Think of bad news as the meat in a sandwich that’s surrounded by two pieces of bread and some dressing to make it taste better. Start the conversation with thoughts or facts about what is working in the markets, your company or  the client’s portfolio. Then share the bad news or the meat of the issue. Last, end the dialogue on a positive note. Clients are human. We all find difficult news more palatable when surrounded by some good delicious information.

2. Be direct. Advisors and wealth managers have a tendency to talk too much when sharing bad news with clients. This is often because being the messenger makes you feel uncomfortable emotions, such as anxiety, fear or worry. Talking more may help you feel better, but it confuses the client. So fight the urge to over-verbalize. Just be direct with the client about what is not going well.

3. Make the client feel his/her reaction is normal. A client will experience feelings after hearing bad news about their financial investments. Don’t fight this by trying to convince the client or yourself that there is no reason to feel bad. Instead, take a deep breath and validate that this news is hard to hear and hard to give, so the situation is emotionally difficult. It is surprising how validating a client’s feelings calms them down and strengthens the advisor-client relationship in the long run.

4. Don’t personalize the client’s reaction. Many well-meaning advisors feel overly responsible for the pain caused by the current economy.  It is okay, and even advisable, to have your own feelings, about the ups and downs in the market place. Just make sure you are not trying to control what is out of your control and taking on too much responsibility. Practice accepting your feelings and your client’s reactions without judgment. Only take responsibility for what is truly in your control.

5. Get support. The best way to survive the current economy is to get support from your friends, family and colleagues. Your job is challenging. You need a place to talk, vent and share your frustrations with others. Model this for your clients because this is a great lesson for all of us to learn. Sharing difficult news is never easy, but it is a little more tolerable when you are not alone.

Kathleen is founder and CEO of KBK Wealth Connection, a company passionate about helping financial services professionals and their clients master their money mindset through wealth psychology. She recently released a new audio program called Creating Wealth from the Inside Out.
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Copyright 2010 by Susan B. Weiner All rights reserved

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  1. […] I love plain English.  So I was delighted to find a section called “Speaking in Plain English” in How to Give Financial Advice to Women: Attracting & Retaining High-Net-Worth Female Clients by Kathleen Burns Kingsbury. I’ve known the author since at least 2010, when she guest-blogged for me about “Five Tips for Delivering Bad News to Clients.” […]

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