In a time where financial stress is weighing heavier on the average Australian, advisers offer a valuable service to many looking for peace of mind and stability going forward.
However, it is those same stresses that make many self-conscious, potentially even embarrassed about one’s personal ability to management their money. From poor spending habits, bad investments, addiction and simply a lack of attention, the idea of exposing these ‘flaws’ to an adviser to many is frightening.
“There can be huge shame tied up in anything from thinking they should be in a better position, through to feeling dumb having being caught up in scams,” Fradley Advice’s Nathan Fradley told ifa.
“In my work I also see a lot of shame from divorcees who felt they should have taken more active steps into the finances earlier, both from a lack of understanding through to not knowing about poor management.”
According to recent research, Australians generally have low levels of financial literacy.
Data released by Iress in collaboration with Deloitte revealed that 59 per cent of Australians have low levels of financial literacy, 48 per cent find basic financial concepts too complicated and generally lack confidence.
The same study highlighted that only 17 per cent of Australians demonstrate high levels of financial literacy. It is this kind of lack of confidence that could both be benefited by advice but keeps potential client from seeking it.
For Fradley, communication and trust are core to avoiding these situations with clients.
“Trust is everything. Clients have to feel safe with their adviser, to know they won’t be punished for anything within their budget.”
“Interestingly, it’s not just about trust in disclosure of spending, but trust to know they’re supported in their own ‘discovery’ of what their spending actually is.”
Ensuring clients that the process is completely confidential and non-judgemental is another method Fradley suggests.
“We adhere to app6, around the use and disclosure of personal information, outlining what we can use client information for and who we can disclose to.”
He added: “Everything from [a firm’s] branding, through to all forms of communication (both passive and active) – which then includes literally telling a client that we are here to help.”
Sometimes humour helps. Saying things like ‘No matter how bad it is, I bet you I’ve seen worse, there’s no shame in money with me; it’s clinical – like a GP looking at a weird mole,’ can be really helpful.”
