Randy Fox interviews Todd Fithian about "above the line conversations"

Randy Fox interviews Todd Fithian about "above the line conversations"

Article posted in Values-Based on 6 January 2015| comments
audience: National Publication, Two Hawks Consulting, LLC, Todd Fithian | last updated: 28 January 2015


Todd Fithian explores the origins and importance of "above the line" client conversations; what they are and why they are important for advisors and planned giving officers everywhere.

Randy:    It’s December 17th, 2014.  I’m here today with Todd Fithian, president of Legacy Companies and current president of Advisors in Philanthropy.  Todd has agreed to talk to me about something called “above the line conversations,” which is intriguing.  Todd, to start off, would you give me a little bit of background about yourself and your company, and then I’ll get into the formal part of the questions.

Todd:    I’m happy that we can have this opportunity to interact with one another around something that’s important to us and I think to anybody advising families of wealth through decisions that they want to make.  As a little background, Legacy was founded almost two decades ago now, which is hard to believe. The work that we do at Legacy today was formulated out of our own practice of advising families of wealth and business owners.  We had found in really helping them make decisions was that our own skill sets as trained financial advisors wasn’t really allowing us to connect with clients in the meaningful way that we wanted to and it was really a stumbling block for us to figure out. What models were there?  What training was there out there to really allow us to develop our skill sets and knowledge around how to really connect with people about what they want and not have it revolve around them having to buy something from us, from a financial product basis in order to compensate us for that time?

We went on a bit of a journey of looking at the industry for that model and we really came back empty handed.  Today there are lots of resources out there and thankfully so because there are lots of folks that are advising families of wealth and success, that want to perpetuate that, and they need help. The more advisors that are working in this space, the better.

That kind of all grew out of our own practice and by working directly with families.  Then we were inspired by a group of advisors that we knew from around the country that saw what was happening in our practices and our lives, my brother Scott and I; we were having fun.  We were having success and families were actually making decisions and implementing them, and so they asked us to come out and share with them what we were doing at Legacy and how we were connecting with clients, and that’s really the formulation of today’s topic. We were having “above the line” conversations with our clients.  That’s a little bit about our journey and how I got to be here talking with you today.

Randy:    Well thanks Todd.  Was there a pivotal moment for you that changed you from being a traditional advisor to one that wanted to do more?  I mean, can you think back to that one moment in time?

Todd:    I lost my brother Scott eight years ago. Today I still reflect back on us and our work and of the skill sets that we brought.  It’s funny because it becomes clearer and clearer to me all the time why some of the things happened the way that they did.  My brother, Scott, was an amazing tactician.  He was super technical, and he could solve pretty much any technical problem that a client had. He could come up with a solution and a strategy for it.  I was never really good at that stuff.  I still don’t really believe that I’m good in the technical space.  I understand it but it just doesn’t give me energy.  I’m more on the relationship side, and that’s just something that’s guided me through my whole life.  I’ve just always been about relationship.  If you put Todd Fithian in a room by himself for too long he’s going to crack. It’s just that I thrive on relationship, on story and really connecting with and getting to know people.  When you ask me about a point in time, a pivotal point in time, it was almost by mistake, I guess. 

There was a client that we had.  Scott mainly had had about 15 visits with.  And on the 15th visit this client finally made some of these minor estate planning changes to their will, and they purchased a small life insurance policy at the end of the process.  As Scott and I started to explore this whole “above the line” idea and really wanting to connect with clients in a more meaningful way about their purpose, their story, their vision, we went back and interviewed some clients.  One of the ones that Scott chose us to go back and interview was this client that he met with 15 times.  And the interesting thing was when we met with that client, one of the things that they shared with us when we asked them, “You know, you met with us 15 times; why at the end of the day did you actually make some of the decisions and make some of the changes we were suggesting?”  Their response was, “We wanted the process to stop.” 

As you can imagine, this was completely eye opening to us.  Here we thought we’re really helping somebody make some important, impactful decisions in their lives and they just wanted the process to be over.  What we came to find out in that interview with them was that they were completely overwhelmed, they were completely confused, and they got themselves to a point where they just no longer wanted to even make a decision because it just all seemed too complicated for them.

I can remember meetings where Scott would come back from a meeting and he would say, “You know, yeah, they didn’t go for it today, but you know what, I figured out a different way that we can come back and present that idea better.”  We took their lack of decision for their lack of motivation and desire to actually do it.  Instead of us saying, “Well maybe we’re not really connected with what they want and why they want it,” we just said, “Well let’s just figure out a different way to present that same issue but in a different way.” 

Randy:    So instead of beating them over the head, you beat them in the back and in the legs.

Todd:    Exactly. And this was the 15-meeting process when you think about was there a point in life, I go back to that story. Unfortunately, you and I both know that there are far too many advisors to families of wealth that are out there still clubbing their clients over the head, they’re still clubbing their donors over the head and many of them, unfortunately just don’t realize it.  We were oblivious.

Randy:    Absolutely, and you know Todd every survey I read, every survey says that same thing.  I mean you and Scott were so far ahead of the game, but the public and the donor base and the wealthy clients are all saying, “Talk to me about something other than strategies, tactics and tools.” 

Randy:    Let’s talk about above the line.  What’s that mean?  Give me some context.

Todd:    Let me set it up in a global perspective, and then I can get into a little bit of details around how we get into this conversation. The biggest thing for us is that if you look back at anyone in history who has created or achieved powerful results, they all started with a context.  Once we have context, then it moves down into the details.  If you look at people like Gandhi or King or Mandela or Einstein, they all relied on context. Albert Einstein said, “If I had 60 minutes to save the world, I’d spend 55 minutes defining the problem and only five minutes coming up with the solution.”  And what they’re really saying there is that it’s all about creating a level of context before we start to get into the details: we look at context before we look at content.

Context is a big thing that we’re teaching advisors about to really clarify and set the context appropriately before we can now start to get into some of the content, and it really makes a profound difference.

When we talk about “above the line” planning or above the line conversations, we use something that we call the “horizon line.” You’ve heard us talk about this time and time again.  Basically, the horizon line is a line that we draw across the page, and what it does is it separates two realms: context- what do we want and why do we want it; from content – how do we get it, who’s the right team, the right people, the right collaboration, and when is the right time?  When is the right and appropriate time to actually execute? 

When we talk about above the line conversations, we’re talking about this horizon line where we’re separating context, the what and the why from the content – how, who, when.  That’s the overarching principal around the above the line conversations. 

Randy:    I think a lot of advisors think they’re there but I don’t think they are.

Todd:    Here’s a reason for that. Most people don’t fully understand or explore their current situation.  They may have a general or vague understanding of what they want. Often, we take a vague understanding of what somebody wants and why they want it, and we begin to now start to move into the content part of the conversation.

We need to spend a sufficient amount of time really clarifying with people what they want and why they want it before we move down to the solutions.  A simple example around this, when a client comes in and talks about a goal and the goal might be “I want to set money aside for my kids that we can give to them through a trust over the next 30 years,” That might be a goal, but what we want to do is, because many advisors could quickly just jump into solutions. “What are the best ways to do that?”  “What’s the best way to structure the trust?”  “What might be some best practices around the right points in time from an age perspective to be able to give the kids the money?” 

When we talk about above the line conversations, what we want to do is really engage with them about “well if you were to give your kids this money over the next 30 years and at the end of that 30 years your family was still intact, all the kids were still together, that there was a lot of family harmony and everybody was still connected and together respecting the family’s vision, the family’s values, their overall mission, what would need to happen in order for that to take place?”  “What would that even look like?”  Maybe they can’t envision what that would look like.  And so we really want to take them on a journey and allow them to explore and dream and even so much as forecast - more than a financial forecast - kind of a relational forecast - around what is that ideal that we’re trying to achieve from a relational standpoint. We have to answer that before we get into what are the best, brightest, smartest ways in order to be able to structure it?

I hear so many people that are talking about, “I get into those conversations.  I have those conversations with clients,” and we find that more and more people are and I applaud that.  But this is not easy stuff.   I just addressed a large group, and I asked this group, “How long did you spend building your technical competency?”  I had the advisor in the front of the room that was in the business almost 40 years.  He said, “I don’t think I was technically competent until I was probably ten years in the business.  So the first ten years of my practicing years, I spent time educating and practicing and, building up all of my credentials, my education,” I said, “Well the above the line part of the conversation is going to take you probably even longer than that,”

This is a harder conversation to me than it is becoming proficient around the technical expertise in this industry. 

Randy:    The technical things you can look up in a book.

Todd:    Right.

Randy:    But human relationships, every single one, are different, aren’t they?

Todd:    Absolutely.  You might be able to apply the same strategy over four families, right.  But the dynamics and the relationships and the values inside of those four families can be completely different from one another.

Randy:    True.

Todd:    It’s the relationship side that I think requires the work and the dedication. I believe everybody that wants to become better at relationships and really helping people to connect with themselves and what they really want, I believe anybody who wants to do it can do it.

Randy:    Some people can do it better than others, all things being equal, just because of their own personal gift.

Todd:    I think one of the gifts that I was born with was relationship. I’ve had it in every aspect of my life growing up.  In high school I was a chameleon.  I could fit into every single different clique and group in school.  It didn’t matter.  They all accepted me because I could morph into where they were and where they needed me to be at that moment in time, and it still kind of carries with me in life and I can see it in so many different applications, and I see people like that all the time.  I think women are much better in this space.  You and I know a lot of tacticians in this business.  I’m seeing a shift, and I’m seeing it weekly. I’m seeing people that I’ve known to be amazing tacticians start to see that they need to shift their skill set. I got a phone call this morning from somebody that I’ve known for 20 years in this business who has done really, really well in financial services who called me up and said, “I’m ready.  You know, we’ve tried this before.  I wasn’t ready,” because in financial services, it’s going to change, it’s already changing. You can be a really good tactician and you can be compensated extremely, extremely well.  And that is changing, too.

And so I think compensation has had a lot to do with the way that people have practiced, and that is starting to have an impact on the shift, but also what you’ve said is that advisors are starting to smarten up because they’re reading the research and what wealth holders are saying is that they want more from our advisor relationship.  They want somebody who’s going to take the time to get to know them and to connect with them in a more meaningful way.  Even to the extent that the decisions they may make may not be the most tax efficient or tax wise.  If it gets them what they want, that’s more important.  Advisors are starting to read this and understand it

Randy:    I think it’s important that advisors pay attention.  Why do you think those that aren’t moving this direction aren’t moving? All the arrows are pointing us down this road and there’s still a lot of people that are totally reluctant to enter into anything deeper than, “How was your day?” 

Todd:    I guess what I want to say is that I don’t think that people don’t want to have them.  I just think that there are a lot of people out there that haven’t thought to have them, and no one’s taught them how to do it.  I think that we oftentimes run around with our solutions whether we’re a fundraiser representing a cause or an organization or a financial advisor representing financial tools and strategies.  We’re often running around with that, and we think that that’s our expertise, that is our knowledge and partly it’s our job. Really all it is is a potential solution.

As I said, it’s finally shifting.  People are really craving to know how do I have this different conversation.

Randy:    How does an advisor?  We all think we know how to have relationships because we’ve had them our whole lives.  We have parents and siblings and friends and cousins and brothers and people we’ve somehow managed to keep relationships with in our lives.  How do we begin this practice of being more mindful or more purposeful with our new clientele or a new donor?

Todd:    From a donor perspective or from a financial advisor perspective I’ll look at a little bit differently.  From a financial advisor perspective, and we’ve been saying this for years at Legacy, is that I believe that the only way to do this effectively and sustainably in the financial services model is to separate your advice.  How you help people connect above the line what they want, why they want it from the solutions that you provide.  I think by combining those two things together, that it’s too intertwined and it’s too interconnected, that families will not freely jump into that conversation where they feel like there’s an obligation where they have to engage and they have to buy into something.

So we’ve been huge believers, and I still am today and we’ve proven this for 18 years that the most effective long term and sustainable model for having above the line conversations and building deep meaningful relationships is by separating how you engage around that from how you actually help families deliver on those things.  The result is, and we’ve been able to now capture this, is that when you connect with a family above the line and you get to know their mission, their vision, their values, their goals, everything about them in a meaningful way, they will want you to be the advisor that guides and facilitates all of the planning that needs to happen to get that.  We’ve seen that over and over again. 

Randy:    That was always my experience as well, so I can confirm that.

Todd:    From a fundraiser perspective, I think it’s a bit different.  The challenge that they have is that as much as they want to look at financial advisors as salespeople, the fundraisers are as much of a salesperson as anybody in this whole process because they’re oftentimes representing an organization or a cause.

And so that’s their toolkit.  They often don’t see that. I talk to them about when they’re going to meet with donors, how often are they talking to the donors about the organization’s and the new building that they’re trying to create or this new wing on the hospital, or this is our cause, this is our mission, how do you want to help us participate in that?  How do you want to help us be successful?  And what I tell them is that there really needs to be a different conversation.  The reality is that if you’re only getting pocketbook philanthropy from donors that you know or believe could do more or should do more, you need to get connected with what is important to them and you need to be having an above the line conversation with them – what’s important to them and what’s driving them?  What do they care about?  And if they can connect that with the organization or cause or the needs of the organization, they’re going to find a more engaged donor than they’ve ever found before.  Easier said than done.

Randy:    I’m starting to see that conversation take place in some of the charities that I am around on a more regular basis now. 

It’s funny, it’s happening very slowly, but it is happening, and I think that’s great.

Todd:    I had a fundraiser who I’ve done some work with.  He works closely with one of my financial advisors.  And he was telling me how they’re being managed and how they’re being overseen and looked at in their roles, whether they’re having success or not.  He actually had a very good donor pass away a year or two ago, and this donor was going to be an opportunity to be a really major donor to this organization.  He was going to go to the funeral service and his boss actually got wind of the fact that he was going to go to that and said, “That’s not an effective use of your time.”  That is amazing to me. 

That is at the farthest boundary of what relationship is.  Here’s a donor to an organization that has helped year after year after year.  Yet it’s a bad decision to send somebody out to represent, to say “thank you and we’re so sorry for your loss.”  That’s amazing to me about where they’re looking at the allocation of peoples’ time. 

Randy:    That’s a whole separate conversation time.

Anything just in wrapping up, the 25 words or less on what’s next for our industry, what’s next for advisors, what’s next for charities in the above the line world?

Todd:    Well I think you stated it earlier and I talked about it a couple of times here.  We’re finally coming to a point where consumers, wealth holders are reaching out and saying, “This is what we’re looking for.  We’re looking for somebody that can connect with our purpose, help us get clear with it because we don’t often know.”  If I was in fundraising, if I was a financial advisor and I wanted to look at having a successful career both personally and professionally – one that’s not only financially successful but feels good where I’ve had an impact – I would be increasing my skill set and my understanding around how to engage with people in this meaningful way, in these above the line conversations. 

I’m going to tell you the one thing that you need to bring out, and we all have it, whether we show it or want to admit it or not, but the one thing to do this type of work well that you need to bring out, forget about business model and structure and all the things of how you engage, the one skill set you need to bring out – it’s not even a skill set – it’s something that’s within, inside all of us, it’s empathy.  If you can help somebody to feel that you care – you can do it with your eyes, you can do it with your body language – that you care about their story and about their journey and about what’s important to them, just simply that, you will be amazed with where those conversations will go, what they will share with you, what they will invite you into.  My last thing is this - is what’s important.  I urge you all to focus on increasing your skill set and your energy around these above the line conversations and success will be a great part of your future, and you’ll help so many more people.

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