Susan Bradley: Why transition planning requires specialist training

There’s a big on-going debate about the the value proposition of the modern financial adviser, and particularly the extent to which advisers need formal training in coaching and listening skills. One adviser at the forefront of that debate is SUSAN BRADLEY.

A highly experienced financial planner based in West Palm Beach in Florida, Susan is best known as the founder of the Sudden Money Institute, which counsels individuals who suddenly acquire a large amount of wealth, and trains advisers to do the same. She also founded the Financial Transitionist Institute, which provides training for advisers in dealing with people undergoing changes in their lives.

Susan recently gave me an interview in London, where she was speaking at the Science of Retirement Conference. In it she explains how her interest in this specialism came about, why it’s so important that advisers have specific training in it, and how firms around the world are using this particular niche to build successful businesses.

RP: Thanks for your time, Susan. Briefly, what's the background to the Sudden Money Institute and Financial Transitionist Institute? How did they come into being?

SB: It actually began in the late 1990s. I experienced a group of women receiving settlements for medical malpractice, and what I saw was a disaster. They weren’t my clients, but I was aware of it, and I wondered how we as financial planners would have helped them. There was no protocol for a liquidity event or a sudden change in life, even though we did comprehensive financial planning. That was throughout the profession. There was no protocol.

RP: But people often engage with an adviser or planner at important points in the lives, don’t they?

SB: Yes, but we didn’t identify it that way. Back in the 1980s we thought of people who were accumulating wealth. We’re now in an age of wealth distribution; that’s where the demographics are. The problem was that our profession and the industry around it were all about managing the technical side. We didn’t see the personal side as part of our discipline. Behavioural finance didn’t come on the scene until the 1990s; it’s still being developed and it’s only just starting to be used in a practical way.

In the old days, in the ‘80s and ‘90s, we looked at people in terms of their numbers. We saw the personal side as the client’s area; they needed to make their personal choices. We didn’t have a process for that and we stayed away from things that we weren’t trained in. And we found that people make some pretty regrettable decisions when life is changing.

RP: But why should that be? Why are transitions such a problem, both for clients and for planners?

SB: When human beings face transition and uncertainty, when the pattern and predictability of our life dissolves, either by plan or by happenstance, either because of something good or something really regrettable, we face huge change. We usually have new responsibilities. We may have new vocabulary. We need new kinds of advice. We have a sense that life might not be the same as it was, but we don’t know what it will be. There is a break between what was and what will be. And it’s very disturbing to us as humans.

In our culture we like to know what we’re doing. If we have a challenge, we like to meet the challenge, deal with it and move on. But with these major life events there’s a break in normal patterns, and all the newness that comes with it changes relationships, it changes self-perception, and it changes the way we see our future. All of that together influences our money and personal decisions.

So something besides the old linear, technical model needed to be created, something that interacted and integrated with the technical. It’s not just money and it’s not just human; it’s the combination, and that’s really the magic of transition planning.

RP: There seems to be a growing consensus that advisers and planners need to acquire so-called softer skills and become better listeners. But is there a danger that some are straying into the area of therapy?

SB: Yes, we need to make a very clear distinction and acknowledge that we as financial planners are not therapists. We are not life coaches and we are not counsellors. We’re financial planners. You can refer clients to those other professions, or you might even employ some of them within your firm, but that’s not what we do.

But we do deal with the human side of money. What does it mean to someone, and why does it mean that? How are they best served to move forward? What happens to them when they feel overwhelmed? Some people really collapse. They don’t have the cognitive capability. Some people, when they hit this uncertainty and grief, want to run though everything. They want to get everything done before they collapse.

We all have personal styles, and if a planner doesn’t understand the client’s personal style for managing change and uncertainty, if you treat them all the same, there is a good possibility that you’ll have clients who don’t maximise the experience, or worse, make some regrettable decisions.

It will look like it’s the client’s fault. That’s generally the way it’s interpreted. Advisers will say, “I told them to do this, but they didn’t do it.” If you can help the client to pause and collect themselves before they make a decision, that doesn’t make you a therapist, but it makes you a great guide. It makes you a thinking partner for people at times when they really need it.

RP: The Financial Transitionist Institute provides training for financial planners who want to develop a specialist expertise in this area. You’re also offering a designation — Certified Financial Transitionist (CeFT). Tell me about that.

SB: The training was an evolution from the Sudden Money Institute, which is 18 years old. It was really in the crisis time of 2008 that we realised that the tools and process that we had been studying for eight years were critically important. We needed to find a more organised way to train and to impart this knowledge and the work process that we had. So we started working on more training models. And in 2014 we decided that we would call ourselves financial transitionists — planners who are skilled and trained to manage change — and to certify, so the public knows our transitionists are specialists.

If we were going to say that we were certified we really needed to step up to the plate and meet all the requirements of a proper certification. So we have a 12-month program, which is mostly virtual. The program is divided into six modules. It’s experiential learning, and it’s science-based. We have a great faculty of scientists and others who have wisdom to bring to this.

The advisers have to be qualified and have five years of client-facing experience. They either need to be a CFP, a CFA, CIMA or PFS. We really need to know that they have developed their technical skills, because you can’t not have technical skills in this area. We train advisers around the world, and we also have study groups. At the end of the 12 months there is an eight-hour exam. People need to be able to integrate this knowledge, so it’s a combination of multiple choice, structured response and test cases, and we also test for listening as part of our protocol.

RP: How helpful do planners who take part in the program find it? And what do they go on to do?

SB: Many times we hear that this program changes who they are as a planner. It give them the confidence to work with clients in uncertainty. Many of them, without really thinking about it, have developed an amazing business around this. They’re working with retirees, widows and widowers, and with inheritors, and because the experience they have is transformational for the client, it’s natural for the client to tell their friends. So the referrals are exquisite. And they come from outside their geographical area.

So they’ve had to figure out how to build a business around this, how to charge for their services as a financial transitionist, which are unique. They deliver a different experience, and their businesses have grown tremendously.

When they tell people in their community they’re a qualified financial planner who is also trained in managing change and transition, if someone needs that kind of work, there’s no place else to go. So great businesses are being built around this niche around the world.

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