For many years, Frank Legan was bothered by a problem in the wealth management industry when it came to how advisors saw their clients' financial futures.
It seemed all about the destination and not the journey.
"I noticed how many people in our field got caught up in the numbers and did so to a fault," Legan wrote in his debut book, "
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Although the book is addressed to the average consumer, advisors seeking an edge in their own work on retirement planning may benefit from the practice techniques Legan shares, including diagrams his team uses to reflect on their work, and open-ended questions he asks readers, which can be posed to clients — questions like "What am I most proud of in my life?" and "How has my family impacted my way of thinking about finances?"
Legan also includes stories from his decades-long relationships with real-life clients — whose occupations included paramedic, teacher, accountant and corporate executive — that can be instructive for advisors. Legan, who does not have an asset minimum for clients, prefers to instead work with those who have situations where he feels able to provide value and apply his firm's method.
FP spoke with Legan about his writing process and what financial advisors can take away from his book. The conversation below has been edited and condensed.
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Financial Planning: Why did you choose to put your experiences and thoughts into this book?
Frank Legan: We have these great conversations with clients one-on-one, where we talk about those two o'clock in the morning issues that keep them up at night, the things that they think about, the things that they worry about. I thought this was a really good way to share one to many. Because people have similar issues or things that they worry about.
FP: Your book often talks about the pitfalls of a one-size-fits-all approach to treating clients. Do you think the industry is doing better now at offering a human-centered approach than it was when you started out? And if so, where do you think advisors can still improve?
FL: I
FP: Do you think that there's also been a trend in the industry away from serving people with lower asset levels?
FL: I really do feel like there's a place for everyone in our business. There certainly are firms that cater to the high net worth and the ultrahigh net worth class of people. I would just encourage somebody that maybe does have a minimum, that it's a really good practice to have a place that they can send (lower net worth clients) to, or a resource that they can send them to, so they don't just leave them out in the cold without a potential solution.
FP: What do you hope that financial advisors get out of your book?
FL: Focusing on what's most important to the client, which isn't necessarily "What did the S&P 500 do?," or "What did this benchmark do?" or "How was my performance relative to that?" Those conversations are so hollow.
I had a meeting this morning with somebody that I've worked with for a number of years, and she's moving. She's older, and she just wanted to come in and have a last in-person interaction. And it was just so special. It was me and my team. And we joked, and we laughed, and we talked about how far we've come together, how far she's come in her life. And it was very celebratory. And she goes on to this next phase, this new chapter in her life. When your relationships are driven by those things, as opposed to all of the technical things that we all need to be good at, it just leads to better outcomes and better relationships.
FP: A lot of advisors feel incentivized to provide what they think is value by helping someone maximize their net worth. For you, you're thinking in terms of quality of life wealth. Do you think that the industry has more work to do around that conversation?
FL: I think it's obviously well-intentioned, right? People are trying to grow the nest eggs of the people that they care for. But it's the "why" we're doing that, for each individual family, that matters so much. I'm 50 years old. The S&P 500 is up 10% per year from the day that I was born. And it's lost half of its value three times. So depending on where somebody is in their life cycle, and what's important to them, I'm sure a 10% rate of return sounds great on paper. But is that experience the experience that they want to sign up for? Helping them understand their "why," and what it is that they're trying to accomplish, and who they are as people, leads you to a much better-informed way of determining what level of asset allocation somebody needs to be invested in. As opposed to just trying to earn as much money as you can. And it leads to better client behavior, because when the allocation and the risk level (are) tied to spending more time with grandchildren or making work optional at a certain age for those that are feeling burnt out —it's more meaningful.
FP: What was it like for you to write this book?
FL: I started this two years ago. It's been a growth process. It's certainly brought me closer to clients. With each story that we told, I made sure that we share those with those particular clients. I wanted to make sure that they felt like they were being portrayed accurately, and also that we were protecting their confidentiality. And it certainly has made those client relationships stickier. I feel like we have a sense of common purpose together. And a lot of them were really caught off guard by how we, as a team, were inspired by them.
FP: What are your plans for the year ahead?
FL: We're doing lots of things like this. We're putting out content on a regular basis. I started writing for Kiplinger. We plan on highlighting client stories (in) some of the topics that we share, for the remainder of the year. We're really excited to share the stories of clients, so that people can maybe see themselves in those stories and know that there's a better way to do things.
