If It Is Not Simple, You Are Not Working Hard Enough
Best Practice Advice & Compliance & Financial Advice & Financial Planning & Practice Management

If It Is Not Simple, You Are Not Working Hard Enough

July 11, 2022

by Tony Vidler  CFP logo   CLU logo  ChFC logo

It takes a lot of work to make complex advice simple and succinct, and nowhere is this more apparent than in the creation of  a financial plan or  Statements of Advice. Those 40 page plans, or worse those 80 page plans and pieces of written advice, are barriers to consumer engagement and frankly they immediately suggest that an adviser did not work hard enough to condense the advice ino a useable form.


One of my favourite quotes is: “I’m sorry I wrote you such a long letter, but I didn’t have time to write a short one” (Blaise Pascal).  Another all time favourite is: “If you can’t explain it simply, then you don’t understand it well enough” (Albert Einstein)


Pascal and Einstein would have shuddered at how written advice is being delivered mostly these days I suspect.


The financial services sector appears to be producing documents for courtrooms rather than clients.  In an increasingly risky and litigious world there is a tendency for financial institutions and those providing support services to financial services to head towards complexity and extensive butt-covering.   Not surprisingly, those providing advice to advisers (whether that be institutions, dealler groups or compliance services) generally want to protect themselves first….so overly legalistic documentation gets delivered to advisers as a framework for them to use with clients.


The advisers then often feel the need to ensure they are protecting themselves…and another layer of complexity is added to the mix.


Throw in the opinions of professional associations, specialty lawyers, consultants, services providers to financial advisers – all of whom are making noise in their own bid for relevance – and that client documentation is no longer just “your advice”.  It becomes the collective wisdom, disclaimers and suggestions of a whole bunch of people…most of whom know absolutely nothing about the client you are trying to advise.


The end result is “complexity” from a clients perspective, and it is more often than not compounded by the somewhat disjointed collection of information which is presented to them over the course of the advice process.

Financial advisers – and those who say they care about the success of financial advisers businesses – need to step back and re-assess what has become a ridiculous situation: the propensity to overwhelm consumers with meaningless and increasingly impersonal information masquerading as “advice”.


We should begin an engagement with the end in mind….

…and the end point of the process is delivering useful advice to a consumer which they can, and will, act upon to improve their situation.   What they tend to want is pragmatic and easy to understand guidance on what needs to be done to change their future.

The objective of any written advice should be to provide clarity- not confusion.

Expert advice should provide solutions – not frustrations.

Advice process documents should demonstrate that the adviser is a technically competent master of their field – by providing simple and effective recommendations. Simplicity is the ultimate in sophistication, right?


The end result will ideally be that the advice instils comprehension, belief and confidence in the consumer.  


To achieve this requires that we constantly look to introduce simplicity in at every step of the advice process.  Creating simplicity is actually harder to do than creating complexity….so we need to lift our game.  But we also need to push back on the trend towards more complexity when it comes at us from regulators or institutions or consultants…or whoever is pushing more paperwork.


Producing written advice which is comprehensible and which also facilitates a desire to begin a process of changing direction is the objective.  That is something which a coach might provide…not something an expert witness would create for a Judge.

For financial advisers there has never been a better time to go back and re-visit the concept of K.I.S.S. – because that is what the people paying fees actually want mostly.  If there is one business truism you can bet on, it is that more consumers will want to do their business with people who make life easier for them, and who are giving them what they want.

That begins with delivering comprehensible written advice.


You might also be interested in this related article:
A Statement Of Advice Should Be A “Statement”
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