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How to Write a ‘clear and concise’ Statement of Advice

How to Write a ‘clear and concise’ Statement of Advice
Financial Planning

Let’s talk about how to write a great Statement of Advice document

I’m going to be very direct in my communication here. No point beating around the bush! When it comes to writing the perfect Statement of Advice (SoA), most financial planners and advisers have a long way to go. One of the biggest problems? The way we communicate to clients in the written form. It needs work.

These tips on how to write a clear and concise Statement of Advice document are a great place to start:

1. Know your audience

It’s great to use a NextGen communication style but if the bulk of your clients are pre-retirees, at best it will be misunderstood; At worst - a complete turn-off. Your target demographic should align with the tone of your communication. In fact, that alignment plays is an important part in how you style your Statement of Advice as a whole. Resonate with your target demographic - don’t alienate.

2. The Executive Summary should be a summary

Resist the urge to copy and paste all the recommendations and products outlined later in your SoA within your executive summary. Limitations in coding are usually partly to blame for the regurgitation of advice recommendations in your summary’s place. But since the executive summary is often used as a reference tool in the advice presentation appointment - Make it sharp and to the point.

3. Clearly link the advice to the client objectives

If the advice isn’t helping achieve, or work towards, what the client wants, what I ask, is the point? If the client cannot look at the Statement of Advice document and clearly see how the advice helps them achieve what they want, you run the risk of them feeling misunderstood, confused, disengaged.

4. Remove explanatory content

This should form part of support documentation; whether you refer your client to online learning modules or provide education on strategies in the SoA Annexure. Keeping it separate from the advice makes the advice stand out in the Statement of Advice (and keeps your SoA in line with ASIC guidelines per RG 90).

5. Reduce the jargon

The Statement of Advice is not the place to prove to the client how much you know, save it for the face-to-face interactions. RG 90 clearly states that the use of ‘simple, plain language’ is required to provide a ‘clear and concise’ SoA. Enough said.

6. Tailor the template

I love a good Statement of Advice template! But if it isn’t tailored to the client’s unique set of circumstances, it’s not good enough for the client, and it won’t be good enough for your auditor either. One of the benefits of using a tool such as Nod is the flexibility it provides in conditional rules without code. Make use of these tools and invest in a good paraplanner / paraplanning service too.

7. Use charts, tables and dot points to explain information in the Statement of Advice

I am still surprised to see AFSLs use Statement of Advice templates with one table, this being the fee disclosure of the SoA. It’s particularly difficult for the visual people amongst us. A flow chart can explain half a page of written text. When you are moving funds around, draw a picture. Imagine if we could summarise the client’s current situation as a one-page infographic!

For financial planners and advisors, keeping advice documents clear and concise has one end goal; helping clients understand and adopt the advice.

Writing a clear and concise statement of advice is essential to ensure full transparency of what to consider, what to do and what to pay. And that, I hastened to add, is what we all want.

Further reading to help you master Statement of Advice documents:

To ROA or SOA? That is the Question

What Makes a Great Document

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