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- Financial planner Tania Brown says productive conversations with clients include lots of questions.
- The biggest sign that someone knows more than they realize about money is humility on the subject.
- Having a budget and paying off credit card balance every month also indicates good instincts.
Financial planner Tania Brown finds that about 70% of her clients know more than they realize, while 30%, or maybe even 20%, know less than they think.
"The person that thinks they know more than they do will hunt me down at a cocktail party and tell me how much they know more than I do," she told Insider.
However, the clearest sign that lets her know she's about to have a productive conversation with a new client is when they approach her with lots of questions. It's a sign of humility, she said, and indicates that the client in question has an open mind to feedback on their financial decisions.
The second positive sign is how they prioritize. "Their chief focus is on things that they have control over," said Brown, who cited day-to-day spending and credit card debt as examples of this, as opposed to things out of the client's control, like the returns on their investments.
The following our statements stand out to her as signs clients may know more about money than they actually realize.
1. 'Can I get a second opinion? I just want to make sure I'm not missing anything.'
Brown said that when she hears this question, she "knows they're not missing anything."
She said that this statement indicates to her that they're open to new ideas and that they are actively working on their finances. This sentiment is often followed by the statement "I'm not sure of what I'm doing," and she almost always responds by telling the person that they are actually doing quite well.
2. 'I feel so stupid with money.'
Brown said that this statement "breaks her heart," and that she cringes when she hears it.
"We all know something; no one is starting from the ground," said Brown, adding that there is a great deal of information out there about money management and that no one knows everything that there is to know.
3. 'I have a budget.'
Having an actual budget tells Brown that the client is "really good at money management." She described having a budget as the "foundation" of good financial health.
A budget indicates to her that the client understands how much money is coming both in and out of their household, which means that they can already see what areas need improvement and what's working.
4. 'I pay off my credit card balance every month'
When she hears that the client pays close attention to their credit card debt, it indicates to Brown that the client has a level of discipline that is probably also reflected in other parts of their overall financial picture, like their investment portfolio.
"They're typically doing well, and making good decisions in quite a few other areas," she said.
Brown added that when it comes to her practice, the majority of her clients match this description — because a willingness to approach a financial planner in the first place is a sign that they're actually interested in building wealth and hitting financial goals.
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