Deeper Client Assessments

Here are three tools which suggest that the softer side of financial planning may be starting to catch up with the ‘hard planning’ software instruments.

Some of you may have noticed that United Capital impresario Joe Duran sold his firm to Goldman Sachs for $750 million.  A big part of that valuation came from Duran’s efforts to brand United Capital, somewhat improbably, as a technology firm—based on its development of two client questionnaire instruments (Money Minds and Honest Conversations) that are used as tools to help advisors gain insight into clients’ preferences and mental makeup.

I have to confess that I’ve never been a fan of either tool—Money Minds in particular.  You pick seven tiles, choose one of three choices on each tile, and based on your responses you’re put into one of three categories.  Three?  The entire human race fits into three categories?

Moreover, I’m concerned that Goldman seems to already be weaponizing this flawed assessment against the mainstream planning profession.  After I took Money Minds a second time, pop-up ads have been following me all over the Internet with a persistence that I thought was only reserved for Ken Fisher advertisements.  The message seems to be: We, at Goldman, delve deeper into your psychology and life issues than anybody in the industry.

Well, yes Bob (you might say), but can you recommend anything out there that’s better than this?

Yes.  In fact, I can recommend three platforms or instruments which delve into a client’s psychology and preferences in what I believe are orders of magnitude more insightful ways that help help you learn much more about your clients.

Let’s start with DataPoints, LLC (, which was created by Dr. Sarah Stanley Fallaw.  Fallaw is the daughter of Tom Stanley, author of The Millionaire Next Door.  She currently serves as Director of Research at the Affluent Market Institute, the firm her father created, and is author of The Next Millionaire Next Door.  She has a doctorate in applied psychology, and in her career as an industrial psychologist, she has expanded her father’s research into a much deeper study of the key financial behaviors that impact clients’ financial success over their lifetimes.

“We use science to identify the critical competencies for building wealth over time,” Fallaw explains.  “We look at the components that allow someone to be successful.  At DataPoints,” she adds, “we took the job of household CFO and we have identified the critical competencies to be successful in that job.”

DataPoints applies Stanley’s and Fallaw’s research and makes it available to financial planners in a variety of ways.  Fallaw leads webinars, has published the book, and most importantly, DataPoints has developed client assessment quizzes that measure a clients’ financial behaviors in six dimensions: frugality, confidence, responsibility, planning and monitoring, focus, and perhaps the most important, which was outlined in her father’s book: social indifference—that is, the ability to avoid the temptation to keep up with the Joneses, to see a neighbor with an expensive flashy car and not immediately desire the same car, to, basically, not be powerfully tempted to live beyond your means.   

Of course, there are other things to measure.  The influence of the parents can be seen in a client’s financial behaviors, particularly if they exhibited frugality and were open about discussing finances with their children.  Some lucky individuals know how to spend their time, energy and money efficiently, which means a reliable rather than a flashy car, and well-built furniture over cheap Ikea furniture that might have to be replaced in a few years.  Wealth-builders believe that people should invest, and they tend to commit to building knowledge long-term.

When you subscribe to DataPoints, you get access to eight assessment tools. Four are designed for lead generation purposes—to engage clients on your website.  The other four offer a deeper dive into client propensities and behaviors to help you help the client become a better wealth builder. 

As a test, I took four of the instruments: one that assesses how well I would react to market changes (you can think of it as a client risk tolerance assessment tool, but it focuses more on the ability to stick with an investment policy than the actual fear that the markets generate); another that focuses on a person’s potential for building and maintaining wealth. 

The third assesses the client’s financial perspectives, attitudes related to finances and money, and things like altruism, budgeting attitudes, spending attitudes and status.  The fourth looks at characteristics related to investment decision-making: investing confidence, composure during times of market volatility, risk personality, risk preference and judgment.  All of them were easy and even pleasant, the interface was uncomplicated and I didn’t have to do complex mathematics or choose among hard-to-assess options in the process.

For the lead generation tools, you would simply put a link on your website to the tools.  Clients can play with them at their leisure, and gain self-discovery and personal insights.  DataPoints helps you automate the process of inviting clients to take the deeper assessments—you can invite them to take one, two, three or all of them—and you see on the dashboard which have been completed.  Once a client has finished an assessment, DataPoints produces a report that you can review together, which helps drive a discussion about spending habits, social indifference, etc.    

“If you have a client who is low on social indifference, after going through some of those interview questions, and understanding some of those influences, you can talk about some positives and negatives,” Fallaw explains.  “Maybe he seeks advice from his brother, who tends to be a frugal accountant.  Did he have some working experience growing up?  His wife is frugal and they are on the same page.  So what are his challenges when it comes to influence?  Maybe you find out that his parents didn’t discuss finances, so he has trouble doing so also.”

This can lead to behavior change.  “You can pick one of those influences and help him understand that influence and push it aside when he is making financial decisions,” Fallaw adds.  “We can talk about different ways that he can create new behaviors, and new awareness around them.  When you know what the issues are that can undermine wealth building, you can periodically check in to see how things are going. 

“We’re not trying to change everything about him,” Fallaw says.  “Ultimately our focus is on helping any client build the skills that they need to build and sustain wealth in the long term.”

You can use DataPoints as your risk tolerance instrument, but Fallaw warns that it is a more comprehensive assessment that you might be used to.  “Instead of having a single number or an overall score,” she says, “we break down psychological risk tolerance into different areas, where the advisor can have further conversations around volatility exposure.  Maybe the issue is that their clients really didn’t have the confidence in their own investing decisions, and the advisor can work with them on that.”

Pricing?  If you pay on an annual basis, you can get unlimited access to the various DataPoints assessments for as little as $119 a month. If you want a custom landing page and personalized onboarding help, you’d pay $145 a month.  There are customized options that would raise the price to $189 a month.   Comparing the results of Fallaw’s doctoral-level work building on Tom Stanley’s groundbreaking research with Money Minds is, to me, a bit like comparing a Bentley to a bicycle.  Fallaw brings a new level of scientific rigor to the assessment process, and you will notice the difference immediately when you see the tests.

Conversation starters

Next on my list of superior client assessment tools is Personal Legacy Advisors (, which offers a variety of products created by Susan Turnbull, a member of the Purposeful Planning Institute, author of Across Generations: A Five Step Guide for Creating an Expression of Donor Intent, and The Wealth of Your Life: A Step-by-Step Guide for Creating Your Ethical Will. 

Turnbull started out as a journalist who realized, as she was writing about personal finance, that something was missing from traditional estate planning services.  “I saw that people were spending a tremendous amount of money and effort to pass on what is tangible,” she says, “but what were they doing to pass on their intangibles, what was important to them, what they wanted their loved ones to learn from them?”

This led to the writing of the ethical will guidebook, where advisors were encouraged to incorporate a legacy video or letter to heirs into their estate planning efforts.  That, in turn, led to the donor intent guidebook, which does something similar: it helps people express, in writing, their philanthropic goals—and of course in the writing of them, they clarify what previously had been unclear.  Advisors can then take this mandate and implement it with a portion of the client’s wealth.

The common thread of these initiatives was to help advisors help their clients clarify what was important to them, which is a fundamentally important thing to understand about people before you start giving them financial advice.  But why should these efforts be limited to estate planning and philanthropy? 

The tool which I believe competes favorably with Money Minds are Turnbull’s LifeLegacy cards, twelve tile-like cards that advisors can use in their offices, or clients can take home and use as a way to gain deeper insight into their most important life goals. 

A crude way to do this is to ask: “What are your most important life goals?”—which would almost certainly elicit a frozen, deer-in-the-headlights response from clients.  Turnbull’s approach is more gentle and subtle.  Pick one of the 12 cards, and one side says: “Describe a place you love.”  On the back are suggestions to help uncover a story about a place the client wishes she could return to again, or that influenced who she became. 

This, in turn, uncovers values: In what way have the experiences related to this place impacted the course of her life?

Finally (still on the back of the card), are possible ways to translate any insights gained into actions.  How can you translate what you value about this place into opportunities that will enrich the lives of others? 

Clients can actually select any and all cards that resonate with them.  Others invite the client to share a memory about a person who had an impact on her, and recall an important choice she made based on a personal value.  The impact of pondering these issues goes far beyond categorizing the client into one of three categories; it gets to the heart of who your clients are and how they came to be that way.

“Advisors have told me that the cards get their clients thinking about the differences they want to make in their lives and the changes they want to make,” says Turnbull.  “Financial planning should begin with that end in mind,” she adds.  “What greater end is there than to think about what they want to make happen in their lives, and in the world as a result of their lives?”

Seeing the questions laid out, not as questions but as invitations to think more deeply about your life, changes the initial client meeting dramatically.  An advisor might look at the level of conversation he/she is currently having with clients and realize that there are fathoms of uncovered depth left to explore.  Are clients encouraged to clarify who they are and what they want at a very deep level? 

“The goal is to create these fabulous conversations,” says Turnbull.  “Advisors who use the cards are developing relationships with clients at a level that they didn’t have before, which will definitely make a difference in the quality of the plans they develop.”

Price?  You can get one set of the professional life legacy conversation cards, with the detailed prompts on the back, for just $49.95.  Turnbull says that many advisors will purchase multiple copies so their clients can take a set home and discuss.  If you want the package with a set of smaller cards, the larger professional cards, plus a copy of the two books, the price is just $89.95.  Maybe Goldman Sachs can buy a few million packages.

Many tools, many issues

By far the most comprehensive client evaluation tool is offered by a company called Touchstone Pathway (, which I’ve written about before.  The creator, Bob Bolen, of Envision Wealth Planning in Brentwood, TN, has been part of the life planning scene for several decades, and set out to create better—and more importantly, more specific—tools for client discovery than he was able to find in the marketplace.

Rather than funnel every person in the universe into three categories, Bolen expanded the inquiry, by creating several general quizzes and questionnaires, and then much more specific ones that allowed him to drill into areas that might be of high interest to some clients but not others.

The process starts with the Discovery surveys, which ask general introductory questions like current employment, projected age of retirement, how the client prefers to save, an estimate of how much the client spends each month, level of consumer debt and a propensity to spend.  A second instrument includes some questions about the client’s life insurance coverage and investment strategy, and you start to get into life planning issues with the “Financial/Life Transitions Checklist” and the “Financial Life Satisfaction Checkup.” 

If you want to probe deeper, Touchstone Pathway has a “Values” game similar to the virtual cards in Money Minds, except that the questions are deeper and more pointed.  Instead of 17 cards, clients can choose among 68 on the screen, each labeled and described—Autonomy, career advancement, creativity, ethics, fitness, job security and passion, among others—and clients can select which of the cards most resonate with their life and goals in the most important category, or a lesser “very important” pile.

Two other card games let advisors and clients explore financial planning priorities and their financial planning lifecycle.

And finally, if the advisor uncovers an area where it might be productive to probe deeper, Touchstone Pathway offers Topic Surveys.  No advisor would have any one client take all 29 of these, but pretty much any client would qualify for a few of them: Leisure Travel, for example, Work/Life Balance, Investment Philosophy, Emergency Funds, Exercise, Diet, Giving to Family, Budget and Cash Flow, etc.

The goal is to systematize the initial data gathering process, and allow clients to tell you what you need to know in private, allowing your discussion to be informed by their responses.  Clients also self-assess and discover their own preferences in a much more precise way than an anecdotal discovery conversation is likely to do.

After filling out the Discovery Surveys, clients receive a report which organizes the goal statements that clients have prioritized (Bolen refers to these as “touchstones”) and how clients plan to achieve these goals (“pathways”), which become the introduction to deeper conversations.  Interestingly, all of the Topic Surveys can be linked into certain answers in the Discovery Surveys—if the client expresses an interest in life insurance, it might trigger an automated link to the insurance Topic Survey, for instance.  Advisors can even change or add questions to any of the surveys, and compare notes to see how other advisors have modified their survey processes.

Touchstone Pathway offers a free trial on the website, but the cost for a solo advisory firm is $35 a month or $315 a year.  Firms with more than one advisor would pay $25 per month per advisor or $225 per year for from two to five advisors.  Institutional plans for larger firms start at $1,000 a year.

I’m definitely concerned about the hype that is already building around the tools that United Capital has built, how (I have been told) they allow advisors to find out more about a client than they ever dreamed was possible.  You’re going to hear more, in the press and in marketing messages, suggesting that Goldman’s approach is deeper and better than yours.  Meanwhile, I see in DataPoints, Personal Legacy Advisors and Touchstone Pathway three tools that will take your own game to a new level.  And they suggest to me that life planning technology is finally starting to catch up with the technical side of financial planning technology. 

These alternative assessment tools offer new opportunities for you to find out much more about your clients—and to provide much better advice.  I’m excited to see how DataPoints, Life Legacy and Touchstone Pathway evolve, as they gain greater acceptance as routine tools for client discovery and assessment.”