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Mindset matters: Why optimism is crucial for advisors

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Being a financial advisor is difficult work, but allowing pessimistic thinking can turn into a self-fulfilling prophecy.

Research on emotional intelligence indicates that optimism is one of the key predictors for success. People must believe they will achieve their goals or they will unknowingly create unnecessary hurdles.

Some advisors may find that they are lacking desire, determination and dedication. To move past these roadblocks, advisors must be willing to adopt a personal and business philosophy that embraces both optimism and the tenets of peak performance.

The first step in developing such philosophies requires creating a clear vision of oneself and one’s practice. Advisors should ask themselves where their passion in their work lies, why clients would choose them and how to make a difference in clients’ lives.

Next, advisors must shift their thinking from certainty to curiosity. A commitment to learning and excelling is essential to the growth of any practice.

Finally, embrace challenges and be willing to move out of the comfort zone to provide better financial guidance for clients.

Having cleared away the obstacles, maintain a high level of integrity and strong self-confidence. Both help clients feel comfortable entrusting their money and their future to their advisors.

One way to improve relationships with clients is to make a connection with them. This requires leveraging one’s impact through interactions with others.

Having an effective communication style is paramount to being successful. Advisors must be able not only to share ideas with existing clients but also to engage prospective clients in meaningful conversations that will encourage them to want to learn more.

To accomplish this, it is important to understand different communication styles: Does the client prefer details and specifics or just the big picture? It is also important to adopt a “learning mode” and ask relevant questions, while knowing which topics to avoid.

Enhancing credibility is another way to positively influence others, according to G. Richard Shell, professor of legal studies, business ethics and management at the Wharton School at the University of Pennsylvania.

Clients need to perceive their advisors as competent and trustworthy experts with knowledge that is relevant.

If a potential client doesn’t view an advisors as believable, it is unlikely that client will feel comfortable doing business with the advisor.

There are several ways to develop trust.

For example, advisors should always tell both sides of a story, deliver on promises and keep confidences. They should be consistent in their values, listen and encourage the exploration of ideas, and put the interests of others first.

Advisors also will resonate with clients by demonstrating their expertise. Properly doing so requires that advisors research their ideas, get firsthand experience and cite trusted sources.

In addition, advisors must be able to prove what they know, demonstrate that they are masters of the language behind a given topic and not hide their credentials. Finally, team up with credible allies, and gather endorsements.

Making inroads with clients requires strong self-awareness. That means that advisors must understand how others see them and realize that they are judged the moment they enter a room.

It also means successfully assessing and navigating the unique needs and expectations of clients. It is important to take time to understand their core values and expectations of the advisor’s financial role in their lives.

Establishing mutual respect, aligning goals and being authentic are critical behavioral currencies that will enhance an advisor’s value and influence with prospects and clients.

Furthering an advisor’s success in influencing and forming trusted client relationships can be ensured by making their actions predictable, consistent and accountable. Be prepared, propose ideas succinctly, confidently answer questions and decisively close the conversation with specific required action steps.

Denise P. Federer is a clinical psychologist, executive coach and founder of Federer Performance Management Group in Tampa, Fla. She has consulted with financial services firms for 20 years.

This story is part of a 30-day series on how to prosper as an advisor. It was originally published on July 1, 2015.

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