This article has been updated to more clearly attribute information to author Susie Leonard Weller.

One of the hot topics in the field of behavioral finance is the use of heuristics -- simple rules of thumb or mental shortcuts often used to make decisions or draw inferences quickly and with minimal effort. While in everyday life these mental shortcuts help us to function quickly and efficiently, when applied to our personal finances they can often lead to poor investment decisions.

When we as advisors use them in our client interviews, it can also lead to less than optimal recommendations and poor client relationships.

For example, when a new client prospect wants to talk retirement planning, it’s very easy to pull out the old 80% - 100% of pre-retirement income rule. It’s also easy to make inferences about their retirement goals based on their age, their occupation or the amount of assets they’ve accumulated. We’ve likely seen this situation so many times before that it’s easy to assume what the client wants, but that’s exactly when we need to slow down.

The fact is clients are still very nervous about the markets, the economy and their futures.  More than anything they want to know that the person helping them plan that future has heard them.  

Jim Morris, Senior Vice President of SEI’s Private Banking segment recently said it very well. “It’s about understanding your client at a different level. They want to feel their advisor has taken the time to really understand their loves, desires and fears. We keep saying we need to take the emotion out of the investment process—which is true—but the takeaway for our industry is that we need to bring more emotions back into the advice process.” 

And there, unfortunately, is the rub. In my experience most advisors are simply not comfortable having emotionally-laden conversations with their clients. As an industry we are filled with left-brain, logic driven individuals who are very good at analyzing data and putting together plans, but we struggle with fully acknowledging the emotional and psychological needs of our clients. 

Why is that?

According to Susie Leonard Weller, a Certified Thinking Style Consultant and author of “Why Don’t You Understand?,” it’s because thinking in your non-dominant style requires 100% more energy. In other words, if you are predominantly a left-brain, logic-oriented thinker, it really does require twice as much energy and concentration to think in emotional, relational terms.

As such, the use of heuristics (i.e. – mental shortcuts) helps us draw conclusions about emotional nuances that would otherwise require extensive energy to process. The problem is that when we take those shortcuts, we begin to lose the real personal connection we hope to create.

So what’s the solution? Weller says the first step is to recognize the validity of other thinking styles. While those advisors who utilize a rational approach to solving problems may question the validity of emotions in making financial decisions, clients who utilize a relational (i.e.- emotional) thinking style report increased overall satisfaction when they feel they’ve been heard and their values respected. Even though those emotions may not play a role in the quantitative analysis of the investment, they play an important role in the qualitative aspect of the relationship.

In this market where headlines are constantly screaming of the “Next Financial Crisis” building strong relationships with clients will be key to weathering the next storm, whenever it comes. Avoiding the shortcuts and taking the time to recognize, validate and communicate consistent with the client’s preferred thinking style may well be the best way to ultimately build the strongest relationships.


Keith J. Weber, CFP®, CPRC, is a speaker, author and founder of Weber Consulting Group, LLC, a financial advisor training, coaching and practice management consulting firm focused on providing relationship development skills to advisors.  Through the website, Keith provides tools to advisors and clients to help build stronger client relationships.  Keith maintains the CFP® designation and is also a Certified Professional Retirement Coach.  His latest book, Rethinking Retirement, was released in July, 2010.  For more information visit, or connect with Keith on LinkedIn.




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