Never underestimate the importance of a safe space for clients to talk, and do not overestimate your ability to create one. If people do not feel safe enough to unload their darkest money secrets, they will lie to you. As a side note, according to the book Everybody Lies by Seth Stephens-Davidowitz, the degree to which people lie even when told their replies are anonymous is staggeringly high. The only places people do not lie are internet search engines and porn sites.
Making somebody feel safe is not just about providing safe physical space, such as private meeting rooms, assurances that physical documents are shredded or a statement about confidentiality. It is about creating safe emotional spaces too.
If people do not feel emotionally safe, they may knowingly self-sabotage, running the risk of receiving the wrong advice, rather than confessing their guilty secrets about money.
So how do you create the safe emotional space for people to share their embarrassing money mistakes? In my experience, it is by sharing your own mistakes and vulnerability around such decisions.
I remember when I first heard about Carl Richards, the Behaviour Gap guy. Long before his first book, he publicly “outed” himself as the financial adviser who took on a big mortgage he could not repay and subsequently lost his home.
Advisers were initially critical (how could he admit that as a financial adviser?), yet the public warmed to him. Now he is a successful author and New York Times columnist, writing (and drawing) about personal finance.
I did not realise just how liberating it was to share guilty secrets until I publicly shared my own. The truth is, I am a recovering spendthrift and previously would spend money as quickly as I earned it, often quicker.
I had been on several courses with George Kinder where participants shared experiences about money, but when my turn came to “confess” I would always lie.
I was not about to confess my sins to a room full of my peers. The environment was unsafe for me.
Some time later, attending a workshop with The Energy of Money author Maria Nemeth, participants went through a similar exercise of sharing their biggest fears regarding money.
My turn came and I was already rehearsing the lie which would get me through the exercise. Only this time, something was different.
Nemeth had created a safe place for me to “lighten my load” and, despite being in a room full of my peers, that is what I did.
While it was excruciatingly painful to admit I was a spendthrift, I finally confronted my truth. What had Nemeth done to create that safe space for me?
She had done it by sharing her own mistakes and through being overtly non-judgmental.
I took that lesson and now intentionally do the same for my clients, readily sharing my financial failures and making it easy for them to share theirs so they might make better progress.
I had outed myself and it immediately changed my behaviour, and though I lapse occasionally, my relationship with money has changed. Ironically, the ardent savers in the room expressed the problem of being too afraid to spend. It is a funny old world.
Dennis Hall is managing director of Yellowtail Financial Planning