A multi-part conversation with Cannon Executive Chairman Phil Buchanan

“I recently went away for two days and was jabbed with needles, poked, prodded, banged on with rubber mallets and thumped on the head,” Cannon Executive Chairman Phil Buchanan recently told me.   “Mysterious people wearing masks grabbed hold of my arms and slid me into an ominous looking machine, then warned, ‘do not move!’  Others, hopefully associated with this group, kept taking blood from me.”

I felt a chill of fear when Phil recounted this to me. Had he been seized by aliens? A foreign intelligence service? Vampires?

No, he told me, these events had taken place during an executive physical. “A group of specialists examine you, collect information and your lead physician analyzes this data and from that produces an overall picture of your health.”

Phil confided that prior to this perfectly legal activity, he filled out two detailed questionnaires. The first had the standard questions:  what he ate, how often he exercised, etc. The second asked him what he wanted to do physically both now and in the near future. Turns out, in the next year or so, Phil is very keen on hiking the Inca Trail to Machu Picchu.

 “After two days of physical examinations, I not only wanted to know my physical condition compared to other very healthy men my age, I also wanted to know if I was in the physical condition required to climb to Machu Picchu,” said Phil.

 Because this ancient city is high in the mountains of Peru, it takes five days of hiking—uphill— to get there. Good physical condition is a prerequisite. Why? Because this famous attraction is 8,000 feet above sea level. Climbing to this altitude is taxing because the oxygen content of the air gets thinner the higher you go.

Said Phil, “What I wanted was a ‘bespoke physical’ to learn if I could do such activities as hike to Machu Picchu. Just having confirmation that I was in good health wasn’t enough.”

With Phil’s metaphor of the executive physical in mind, take a look at the chart above. The top section tells you what clients want from their FA now, today. On the bottom is what we as FAs usually offer. Times change and what clients want from us changes as well. To remain relevant, we must alter our behaviors, our understandings, and our fee structures.

Are you giving bespoke advice to your clients? Doing this requires a deeper level of understanding specific to both behavioral drivers and the life goals specific to each client. So when a client tells you they want to retire at a certain age, you need to go deeper than inserting that number into your planning software. Asking where they want to retire is critical. Retiring in New Canaan is a lot different than Mexico.

What do your clients want to do when they retire?  Will they keep their residence, or sell it and buy something different? Do they have something in mind they want to do? Teach? Be a full-time volunteer at a charitable organization? Spend more time with their grandchildren who live far away? Or just relax on a beach without a cell phone? Helping your clients explore their aspirations brings color to the new tapestry they are weaving for the next part of their lives. By doing this, you guide them through the process of moving from the abstract to reality.

At this point, you can employ your technical expertise in a more powerful way. An example is pointing out to your clients that states which have an income tax will be reluctant to say goodbye—New York being one. If your clients have been residents of that state, there is a long list of things they must do to ensure the Empire State really has bade them farewell.

Creating a bespoke retirement plan for your clients means being curious at each step of the planning process. Many of us do not move beyond the factual inputs required by our retirement planning software. Taking time to understand the underlying assumptions and aspirations associated with those facts is the real value we as FAs bring to our clients. This level of understanding is what clients expect from us now because this understanding is what allows us to create the bespoke plan and that is the added value they receive. If we change our practices to provide our clients with what they want now and in the future —they will expect us to share that journey with them and continue to add value along the way.

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Contributing Writer: Subject Matter Expert Charles McCain