The Human Side of Money 5: Andy Hart | Focusing on Managing Humans Instead of Assets to Deliver Better Outcomes
Sep 8, 2020
Andy Hart, founder of Maven Adviser and the behavioral finance conference Humans Under Management, emphasizes the importance of managing clients as humans rather than just assets. He discusses the dangers of jargon and shares specific strategies for enhancing client communication, including labeling techniques that prompt optimal behavior. Hart argues for prioritizing emotional intelligence in financial advising, revealing how understanding clients' future selves can lead to improved outcomes. His insights provide a refreshing take on integrating behavioral finance in practice.
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Managing Humans, Not Money
- Financial advisors initially believe they manage money.
- They later realize they manage the owners of the money, as humans are the source of most financial problems.
The Dog Whisperer Analogy
- Andy Hart uses Cesar Millan, the dog whisperer, as an analogy.
- Like Cesar focuses on dog owners, advisors must focus on the client's behavior, not just their money.
Active Management's Appeal
- Active management appeals to affluent clients because it reinforces the idea that expensive is better.
- This clashes with the principle of low-cost investing, creating a challenge for advisors.
