Let’s throw the fact find in the bin

Let’s throw the fact find in the bin

As lifestyle financial planners, we need to show that we know our clients – otherwise, how can we prove we are acting in their best interests?  But we’ve moved on from ‘compliancy’, stuffy ‘fact find’ forms and that’s for the better. Let me explain… 

‘fact finds’ were created from a compliance perspective

When I joined the financial services, towards the end of the last century, my first experience was with a large, national mutual insurance company.  And it was back in the day when each individual agent had their own round – their own patch of the town for prospecting and finding clients. 

Over the years, you would build a book of business, largely by knocking on doors, introducing yourself and walking them through insurance policies, savings plans and pensions.  Every week, you’d go around and physically collect cash for those policies that you’d arranged.  That means that every single week, you were eyeball to eyeball, on the doorstep, seeing your clients. 

You saw them through the ups and downs – through marriage breakups, children being born, redundancies, successes.  You saw it all on a weekly basis because, quite often, you were having a cup of tea and a chat each time you visited.  You built your client bank through referrals as family members would be introduced to you (especially around the time you were visiting with a maturity cheque! 

Then the FSA came in (the precursor to the FCA) and said, you don’t know your client”. They’d asked to look at the customer files and there weren’t any – nothing was written down.  So they quite rightly said, “you have no evidence that you know your client.  You cannot prove that these policies that you’ve arranged are suitable for these people.” 

So the insurance company brought a big compliance consultant in and fact finds were designed as a form. And there’s nothing wrong with that.  Except, these forms were created by compliance professionals who look for facts.   

But, if you read the FCA handbook, you will not find the phrase ‘fact find’ anywhere – trust me, I’ve read it (well, some of it).  Fact finds are a construct that we have created from a compliance perspective in order to prove we ‘know our clients. 

The irony is, fact finds don’t help us know our clients

Here’s the irony.  Fact finds don’t help us to know our clients.  This is because, whenever you complete a form, have you noticed that you tend to write as though you were in a formal parallel world?  You end up writing it a bit like a police officer’s report.  It’s stunted and factual – the client attended at 10.00am,” “the client had an objective to retire early.” 

These things are factually correct, but they don’t help you to really ‘know’ your client.  They aren’t what my old sales manager would be able to tell me about the client, back in the day. Before we went to any house, he would reel off the past 10 years of their family history – everything that family had been through.  He knew those people better than his own family.  That is ‘know’ your client.

Because of ‘fact finds,’ we lost the ‘humanness’

The thing is, we don’t make decisions based on facts.   No human being ever makes decisions based solely on facts.  Your emotions use facts as a starting point for negotiationAnd the irony is, we’ve lost that ‘humanness’ to technology, (the fact that we type and write these forms). 

Get the ‘humanness’ back with video and voice notes

We can get that humanness back. Do you know what we have that they didn’t have, back in the day?  We have phones.  And you can do videos – you probably put a video on Facebook last night about what you had for tea, or what your kids were wearing when they went to school.  And yet, for a compliance fact find, we write or type! 

If you do a video note and switch your camera on immediately after a client session and talk to the camera about what happened, that’s the most realistic and colourful and textured ‘know your client’ exercise that you could possibly do.  And if you don’t want to do a video, do a voice recording!  It’s comes out totally different to the way you would have written it. 

Here’s a written notethe client attended the offices at 10.15am.  The client is disappointed about some recent changes at work and would like to explore the possibility of retiring.  That’s what a fact find would say  if you write it. 

But if you recorded it on your camera, it may sound something like: George has just popped into the office.  He was absolutely bouncing – I’ve never seen him like that before.  He’s just found out that (in his words) the little scrote that he trained is now going to be his manager! George has told them that he’s going to tell them to shove the job where the……”  You get the idea. 

That is what actually happened.  It’s believable.  Yet, we feel we need to write it down and make it sound like a police officer’s report instead of it sounding……well……like it was. 

So, with PlanHappy, I always encourage video notes and voice notes.  And, you get the added satisfaction that the compliance person has to sit through the entire video to get to the facts that they want – they can’t skim read your ‘fact find’ and just cherry pick little bits out.  Now, that’s rewarding in itself! 

If you record video notes or voice notes, you don’t actually need to worry about compliance – if it’s a direct recording of what happened, it’s already compliant. 

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