I love words. Words, contrary to common acceptance, are not secondary to action. No, in many ways they are action - they can wound, soothe, divide, unite, cajole and repulse. Use the wrong words and you could find your rights and liberty curtailed. In extreme circumstances words can cost you your life.
Good communicators are likely to do well in life, bad communicators less so. Say what you like about the 45th President of the United States, but you can’t deny his use of Twitter to communicate is undoubtedly one of the principle defining factors of his term to date. His words and the platform used to project them, define his time in office to date.
Good financial planning is also about effective communication (although ideally without the political controversy) and the language we use and how we convey it is crucial to ensuring clients get the right outcome for their objectives. This doesn’t mean that the words Advisers use should be simple or basic. It’s not pretentious to use the right word in the right context, even if that word is not commonly known. However; it is important to give clarity to it’s meaning.
The list of new words added to the Oxford English Dictionary in 2018 included Zoodle (zucchini noodle), Rando (random person), Haptics (mechanically generated movement that you experience through the sense of touch as part of smartphone – think the home button on iPhones) and terms you’ve probably used; mansplaining (what I’m doing now) and hangry (when one is hungry and angry). This is the joy of words and language, it’s forever morphing, adapting and renewing itself.
So how does our profession stand up in the face of this wealth of new opportunity? Well, in my opinion, pretty appallingly actually.
The key word is jargon. Witness this letter from a university superannuation company, taken from the ‘Campaign for plain English’ website;
'The trustee company will consider the continuation of a total incapacity pension by testing whether it is more likely than not, on the balance of probabilities, that the member could only do a job for which the member would only be paid less than a small fraction of the member's pre-absence salary. If so, the member would be within the total incapacity definition.'
Or this choice morsel from a letter sent by a Pensions Administration service;
The TPS pays the public service pension, including the GMP. However; the Benefits Agency (BA) are responsible for paying part of the inflation proofing on the GMP. This generally comes into effect when someone reaches state retirement age and is normally paid by BA as part of the state retirement pension. The GMP is calculated by Inland Revenue (Contributions Agency) NI Contributions Office (IRNICO) based on NI contributions paid between 1978 and state retirement age. Therefore, TPS are unaware that a GMP is applicable until notified by IRNICO at which time the Teacher's pension is adjusted.'
These are actual communications to people. It’s enough to make the mind bleed.
“Which” magazine in their November 2018 issue ran an article on insurance company policy documents and the level of education required to read a particular text comfortably. For example (and this is the one they use), the book “Cat in the Hat” requires a Primary School education, Dostoevsky’s Crime and Punishment a Secondary School education, Hawkin’s “A Brief History of Time” a 6th Form Education and Insurance T&C’s a University Education. Incidentally Social Media T&C’s and Online Shopping T&C’s ranked harder than the Insurance documents.
This is down to numerous factors including layout and language, persistent use of jargon and poor use of words and grammar. For example, of the 40 insurance booklets analysed by “Which” the longest sentence culprit was Saga Travel Insurance at 145 words. Aviva’s Home Insurance document used the word “or” an unbelievable 17 times in one sentence! Let me show you that in real terms; “This or is or down or to or numerous or factors or, layout or and or language or, persistent or use or of or jargon or, but or just or generally or poor or use of words and grammar.” Not good is it?
LIFT-Financial believe passionately in using comprehensible and jargon free communications to help our clients understand and navigate the world of financial planning. A recent study by the Financial Times on Advisers and their client relationships found that transparency was one of three key criteria most people have in mind when choosing a Financial Adviser – the other two being Trust and Tailored advice. Granted, the key concern regarding transparency surrounds the communication of costs and employing a financial adviser that can clearly outline what you pay for in a service. This feeds back to using the appropriate means of communication for the task in hand – i.e. when it comes to fees, the less said the better. LIFT-Financial do not charge percentages and instead will time cost all the work we do on a clients’ file. This then allows us to have an honest conversation about what value a client is receiving and explain competently and in full why we charge what we charge.
Good financial housekeeping is a key part of living a happy and successful life. If Advisers can’t use the right words to communicate the best way for a client to achieve their goals, how can the profession continue to justify its relevance and the fees we charge? The American poet Robert Frost said, “In three words I can sum up everything I’ve learned about life; it goes on.”
At LIFT-Financial, we would paraphrase this… “In eight words we can sum up everything we charge in Financial advice; it goes on… the Service and Fee Agreement.”
The views and opinions expressed in this blog are those of the author and do not necessarily reflect the official policy or position of LIFT-Financial.