Data Gathering vs. Discovery

An interesting article by advisor Roy Diliberto, “Data Gathering vs. Discovery,” gets to the heart of how advisors can distinguish themselves in a competitive marketplace. Obviously, data gathering is 100% quantitative and provides the basic financial information we need to do our jobs. Writes Diliberto, “The questions asked generally begin with a phrase such as, How much do you have? How much do you make? How much do you spend? At what age do you plan to retire? How much will you spend in retirement? How much will you need to educate your children?” On the other hand, Diliberto identifies discovery as “learning about who your clients are, not how much they have.” He writes, “It’s about understanding their histories, attitudes, values, dreams of the future, visions of their lives, how they feel about philanthropy and other much more qualitative information. It is understanding what motivates them to make decisions about money–both good and bad.”

He then underscores the differences between data gathering and discovery. According to Diliberto, “Data gathering asks, “When do you want to retire?” Discovery asks, “How do you visualize your life in your 60s, 70s, 80s and beyond?” Data gathering: “How much is your business worth?” Discovery: “Tell me about how you started your business and made it grow, and what are your plans for the future?”

We all have our favorite, illuminative discovery questions. One of my favorites is, “Describe an object of great personal meaning to you.” Over the years, I’ve heard terrific stories about pictures of loved ones, books or wedding rings handed down generation to generation, the key to a first home, and a college diploma earned at night.

The bottom line is that you want to work with an advisor who wants to delve into the more qualitative discussions. These conversations illuminate what informs your goals. And with a better understanding of who you are and where you want to go, an advisor can do the best job possible of getting you there.

So, what is the object you have that has great personal meaning to you?

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