News article

The art of active listening: an underrated yet essential skill for financial planners

Before starting at The Yardstick Agency, I completed a master’s degree in psychology and am currently studying towards a qualification in counselling.

I initially saw these as educational but “fun” challenges that were completely separate from my role as a copywriter for financial planners and advisers.

And yet, the more I learn about psychological theory and how to engage effectively with counselling clients, the more I realise how valuable the core counselling skill of active listening is for professionals in financial services.

Allow me to explain…

Active listening means fully concentrating on what your client is saying

In both our working and professional lives, “listening” can often mean waiting for our turn to speak, rather than truly hearing what the other person is saying.

We’re busy, we have deadlines to meet, and the clock is ticking. So, we focus on getting the gist of what’s being asked of us by latching on to a few key words and taking it from there.

In contrast, active listening means fully engaging with what your client is saying and seeking to understand their needs, beliefs, and values. It’s not just about what’s being said, but also, about being able to interpret non-verbal cues such as body language and eye contact.

Sounds like a lot of effort? Perhaps, at first. But, as with most things, active listening is a skill that gets easier with practice. And the benefits can be significant…

Why active listening is crucial for financial planners and advisers

Effective financial planning is more than providing advice on products and offering solutions. It’s about adding value and helping clients achieve their broader life goals.

Active listening can help by:

  • Establishing trust and rapport – making a client feel heard and understood can instil trust and encourage them to be open about their concerns and aspirations.
  • Helping you understand your client’s needs – both those that your client directly expresses and “hidden” fears and objectives. Gaining this deeper understanding can allow you to tailor your support to meet your client’s specific needs.
  • Identifying and reducing emotional decision-making – if your client is making financial decisions based on emotions, you can quickly spot this and support them in making more objective choices that help them achieve their long-term financial goals.
  • Reducing misunderstandings – by getting to know your client well, you’ll be better placed to align your support with their needs and quickly address any misunderstandings as they arise.

6 tips for using active listening with clients

Active listening is a skill like any other. You might find that it comes naturally to you, or you may need a little practice.

A few tips to get you started:

  1. Role-play with colleagues

If you’re not sure how to use active listening with clients, try role-playing with colleagues first. Ask for feedback so that you can improve each time.

  1. Create a welcoming environment

Wherever you meet clients, be that in an office, on Zoom or elsewhere, try to make the space feel welcoming and comfortable. The more relaxed your client feels, the more willing they’re likely to be to talk openly and honestly.

  1. Show your client that you’re listening

It’s important not only to use active listening but to let your client know that you’re doing so by:

  • Minimising distractions
  • Maintaining eye contact
  • Nodding to encourage your client when they’re talking
  • Leaning in slightly to show interest
  • Using “minimal encouragers” to show you’re listening, such as “mmm”, “OK”, and “go on”.
  1. Be patient and embrace silences

Try to avoid interrupting your client and welcome brief silences as an opportunity for you both to gather your thoughts, rather than rushing to fill them.

  1. Ask open-ended questions

Of course, there’s always a place for “closed” questions – sometimes all you need is a “yes” or “no” answer. However, open-ended questions can be a helpful tool for encouraging your client to elaborate on their points.

For example, “What do you feel about that?” or “How would your life look if you achieved your goals?” are open questions that might shed more light on your client’s needs than, “Are you happy with that?” which encourages a one-word response.

Your client’s answers could help you identify hidden objectives and concerns as well as give you an understanding of their financial objectives in the broader context of their life goals.

  1. Paraphrase, summarise and reflect back

When it comes to financial planning, there’s often a lot of ground to cover and some of the topics you discuss with a client may be complicated.

Paraphrasing can be a helpful way to clarify that you’ve understood your client. Additionally, reflecting your client’s thoughts and language back to them can make them feel heard.

For example, “I’m hearing that you’re concerned about having enough money to retire and you’re not sure what to do about it, have I understood that correctly?”.

In a world where artificial intelligence is becoming more commonplace, demonstrating “human skills” such as active listening is even more important for financial planners and advisers.

It takes just a little effort, but the benefits can be surprisingly rewarding.

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Want to know more about how Yardstick’s team of marketing experts, designers, and writers, could help you? Get in touch with us at or call 0115 8965 300.

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