Sunday Email - BeFi and Tech / Health and Tech

Read time: ~8.45 minutes

Happy Sunday!

Every Sunday I offer strategies for the week ahead and a thought to fuel your action.

Last year I decided to switch from a FitBit to a Garmin.

I was searching for a new health and activity tracker. I've become obsessed with my health and longevity.

Longevity is not just about living longer but being able to be active longer. (On a Related side note, if you are interested in this, I highly encourage you to follow Peter Attia.)

My FitBit wasn't doing it for me. I could see stats on the screen, but they were small and too high-level. The friction for gaining insight I found valuable needed to be lowered, and I lacked trust in its ability to detect activity.

These challenges led me on a journey of researching fitness trackers. Ultimately, I switched to a Garmin.

The switch has led to numerous positive changes.

I'm more aware and conscious of health decisions (eating, activity, sleep).

These changes hinge on many aspects, but two are worth highlighting: reduced friction to get actionable insights and a perfect combination of insights and simplicity.

Let's start with friction.

You must leverage an app for many health trackers to gain insights from the tracker; this creates friction. The tracker is an excellent reminder to stay active, but seeing results (or not) motivates consistency. Thus, the friction limits the opportunity for greater consistency.

The need to go to an app is a significant friction point because I'm striving to look at my phone LESS, not MORE.

Thus, FitBit didn't meet me where I wanted to be. And Garmin provided me with what I needed at the point I needed it. It provided the data I wanted and the reminder I needed while also seamlessly fitting into my life via a watch.

Reducing friction to spur action continued through the journey with Garmin. A morning report with sleep stats was delivered to my watch (not my app or email). Allowing me to analyze and adjust in real time and gain feedback immediately (the next day).

The formula is simple: Low friction + high value = adoption into a routine.

Garmin cracked the code, for me. In many ways, it has provided a blueprint for us to crack the code on elevating service to our clients by changing behaviors.

How has Garmin changed my behaviors? Awareness, leveraging game elements and autonomy.

Awareness of behavioral finance has surged in the last decade. Understanding why humans (clients) go against rational decisions is impactful in our work. We've learned that emotions, cognitive biases, and evolution are at the core of this issue.

Over the years, we have focused on simplifying onboarding, creating more comprehensive financial plans, and building client portals.

Yet, the struggle with getting clients to execute the items we suggest continues to be real. We're better at aggregating, analyzing, and providing access to information, but execution is still a struggle.

To not bury the lead, portals are not the answer.

Portals are overrated and, in my opinion, a waste… at least in the way they are built and leveraged today.

To understand why, look at the data of clients' active logins to your current portal.

eMoney reported in a recent eBook that 66% of clients from a survey had access to a client portal, but only half (~33%) are frequent, active users.

The story's moral is simple: clients don't want another platform to log into.

Having to leverage another platform creates too much friction for the end client.

Clients have behaviors that are engrained decades before engaging with an advisor. Before they met an advisor, they logged into a custodian platform to see their accounts. And this is the most straightforward route to gaining the insights they desire: how much money they have.

Returning to Garmin, they reduced the friction for me to gain insights that ultimately changed behaviors. They didn't force me to change my routines. Instead, I get the information from the face of the watch. It's the pertinent information I need to judge my progress and take action, all while checking the time as I've always done. They fit their product into my life instead of making me fit it into their product.

A lesson we can all learn from Garmin is that the answer is not to have another tool, another portal, or even a better portal. We must rethink how we present the information. And find a way to incorporate insights and information into our clients' lives.

To accomplish this, it's essential to delve into the clients' daily routines and gain a deep understanding of how they go about their lives. Leveraging this insight is critical to tailoring an experience that reduces the clients' need to change their ways.

Gaining this depth of insight creates an opportunity to begin nudging the client toward action rather than telling the client.

With these insights, we can now leverage the benefits of advanced technology like AI.

Here are some ideas on using generative and predictive AI with this information.

• Based on the information gathered, generative AI can create a communication and interaction plan that is tailored to each client's specific desires.

• We can use predictive AI to analyze data from both our clients and other people's interactions with us to predict changes in behavior. This can dictate the best communication verbiage and strategies.

As we make decisions about what technology to introduce to our clients, we must consider the friction we are introducing. The more friction to adoption, the less likely it will be impactful.

A challenge with financial planning is execution. As advisors, we are out of the loop on this. Yet, we must spur action and, ultimately, behavior changes. This is why a portal is not the answer. It causes friction and doesn't provide insights that spur action.

James Clear, author of Atomic Habits, says the key to creating habits is to start small and continue. So, do the most straightforward act (under 2 minutes) for some time (2 weeks or a month).

Our goal with technology and client interactions should be to think for the client and initiate strategies to help our clients develop the habits necessary to progress their financial plans.

To accomplish this, insights/actions must be embedded in daily routines and simple to execute.

With Garmin, I found this right away. Each morning, before the time appears, I see my stats for the night on my watch. This gives me a quick glimpse into my sleeping habits and informs me of things I want to change the next night. I can make immediate changes and see the results right away. I do all of this via my usual routine of checking the time.

For instance, I noticed my sleep score was consistently lower than desired. So, I tweaked my sleep schedule and morning routine a little to see if I could get a few more minutes of sleep and improve my sleep score.

We all know we should do this, but many of us fail to do so. The score and the stats provide a gamification element to my health. This worked; it is motivating.

The gaming elements create engagement through fun and curiosity, achievement and progress, a feedback loop, and autonomy and choice.

I love seeing the progress. I love the immediate feedback loop. I feel comfortable making changes and testing things because I can only see the results. It's risk-free exploration.

Advisors need to find a way to integrate into our clients' activities rather than building a new portal. We need to leverage aspects of gaming into our process. It sounds childish and demeaning to the service of wealth management, but gaming is something people of all ages respond to.

Technology allows us to incorporate this at scale with our clients and track it. Whether it is creating a community of challenges or creating progress bars with different "achievements" after winning or accomplishing a task… we must rethink how we set client tasks for financial planning.

A final point to explore is autonomy. We are often uncertain, we've never done something before, and we are anxious about the outcome. All of these aspects keep us from taking action.

Garmin has allowed me to take action autonomously. I drive the actions and then realize (or don't realize) the outcomes. Nobody tells me what to do. I get to try it out independently and figure it out in a safe place.

The data provided is bite-sized. My general knowledge allows me to make tweaks and see immediate outcomes (good or bad).

The data spurs small actions. I'm not making significant changes and waiting long to see the results. I make minor tweaks and see the impact quickly.

For us in the industry, this means identifying ways to break down the action steps for clients into tiny doses. It's a matter of creating a safe space for clients to express themselves openly and where they feel comfortable telling us the things they tried that didn't work.

Technology can really help us here. We can leverage frictionless surveys and consistent touch points (select a number, etc.) to provide us with client information and nudges.

And this creates a safe place. They don't have to say directly to you that they didn't do something or that they did something and it didn't work. They get to tell a survey, an email, or a computer screen.

We have an opportunity to leverage technology to gain more significant insights into our clients and pair that with our knowledge of both finance and psychology to help our clients take the action necessary to reach their desired financial outcomes.

But to do so, we must rethink how we use technology with our clients. We must understand that to get interaction (and ultimately progress), we must reduce friction. We must also turn what we are doing on its head and learn from others.

A Thought To Ponder This Week

We all have a desire to be healthy.

We want to eat better and drink more water. Exercise more frequently. Get more sleep.

Yet, we fall off the wagon time and again.

It’s not from a lack of desire or resources.

It’s partially due to a lack of patience.

Although knowing it takes time, we want the results immediately.

Ultimately, we look at having done all the right things for a short period as a reason to see results.

But it takes time, focus, and persistence, especially when the results are minimal.

As an industry, we face a similar challenge with regard to utilizing technology.

We lack the time. The time to learn. The time to implement.

Yet, we expect the results to come. And when they don’t we get frustrated.

As is the case with our health, time, consistency, and persistence, which are the keys to gaining the most we can from our technology.

So, as we head into a new week what is one thing we can remove from our weekly schedule and replace with focused time on better integrating your technology?

The best is ahead!

-Matt