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Identifying customers needs in Financial Planning

Needs-based sales advisory is a process where sales representatives help their customers identify their specific needs before offering them products or services. This approach allows businesses to provide their customers with tailored solutions that better meet their requirements. As a result, customers are more likely to be satisfied with the final product or service, and they are also more likely to become repeat customers. The financial advisor must be able to identify a client’s needs through a fact-finding process. He will then analyze these needs and make recommendations. The Financial Adviser closely monitors this process to ensure that the client receives appropriate advice and product recommendations.

However, the financial advisor needs enough information before making a recommendation. You will use the information your prospect provides on their investment objectives, financial situation, and particular needs to advise them accordingly by completing the ‘know your client’ (fact-find) form.

Establish and define client-representative relationship

At stage one, you will establish and define the client-representative relationship. You will meet with potential prospects and explain the purpose of the meeting. This will include introducing the company you represent as well as explaining your role and the types of financial advisory services and investment products you can provide.

Gather data, including goals

Before you recommend an insurance policy to your prospect, you will need to take some time to understand their financial needs. This includes getting to know them better as a client through a factfinding form, as well as determining which life stage they are currently at. This information will help you establish their financial goals and concerns, so that you can better understand their needs. With all relevant financial information gathered, you will be in a better position to provide them with an insurance policy that meets their specific needs.

In order to protect the interests of clients, you are required to assess their financial knowledge and experience to determine if they understand the risks and features of unlisted Specified Investment Products (SIPs) before allowing them to purchase these policies independently. Unlisted SIPs refer to investment products which have structures, features and risks which are more complex in nature and difficult to understand. These are not listed on an exchange, and include a certain type of Investment Linked Policies (ILPs) where the underlying funds are derivatives (i.e. SIP-ILPs).

Analyse and evaluate prospects financial status

All of the information that you’ve gather will have to be analyzed and evaluated in order to form a financial plan that best meets your client’s needs in regards to their specific objectives. This analysis and evaluation is crucial in making recommendations.

Develop and present recommendations

As a financial advisor, you will be responsible for exploring alternatives that meet your clients’ financial objectives. This will include designing solutions and providing options that can reasonably meet those objectives. You will present your recommendations in writing via a Fact-find form and Needs Analysis.

Review with clients periodically

You will contact your client annually to review your policy or policies; monitoring their policies ensures that they are achieving your financial objectives. There is no hard and fast rule as to when a review should be done, but conducting annual reviews is standard practice.

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