Because most of us haven’t figured out how to transfer thoughts from our brains to another’s without written or spoken words, we rely heavily on language to communicate almost everything. As a financial professional, the language that you use is extremely important as it is not only regulated by government agencies, but it is your way of making a living. Now, think about a few specific conversations you’ve had recently with different people in different situations. Do you use acronyms and industry words (jargon) that other people don’t necessarily understand?
The Oxford dictionary definition of the word jargon: special words or expressions that are used by a particular
profession or group and are difficult for others to understand.
If you’re reading this, you’ve probably been guilty of using jargon at some point in time when talking to someone “outside” of your industry. It’s easy to do when you work with people every day that speak the same profession language as you. But remember, easy for you can mean confusion, which can turn into failure if you don’t take the time to use words that are geared for your different audiences.
A study done by Ohio State University1 found that using jargon influences a person’s processing abilities. Think about it, if someone is speaking to you and they use an acronym or term that you don’t understand, what does your brain do? Do you listen more intently, or do you start thinking about the word you weren’t familiar with and become less trusting and confident about the conversation? Your audience is not likely to tell you that they are not comfortable making a decision because they do not understand you. It’s up to you to change the culture of your practice to one of learning and guidance, without fear.
It is simply not human nature to trust the unknown. Therefore, if your financial planning job is to explain investing and risk to a prospective client and you are using jargon and acronyms, your ability to persuade and gain trust is drastically reduced. Even using simple percentages rather than dollar amounts in your conversation can create confusion. A person’s inability to quickly process a percentage versus an actual dollar amount can even create misunderstandings of perceived risk.
Knowing that your success is directly correlated to the language you choose to use, do this little exercise to stay on track:
Put yourself in the shoes of a “younger you”, before you knew any of the industry jargon and remember how new and confusing acronyms could be while you were studying for your licenses. Don’t assume that simple acronyms like IRA (that you use every day for Individual Retirement Account) is instantly understood by all. Your clients may even be embarrassed to admit some of the things they don’t quite get, so take the time to explain, in terms they can clearly understand.
The success of a persuasive conversation depends on the listener understanding not just your words, but the meaning behind them.
1. Bullock OM, Colón Amill D, Shulman HC, Dixon GN. Jargon as a barrier to effective science communication: Evidence from metacognition. Public Understanding of Science. 2019;28(7):845-853. doi:10.1177/0963662519865687
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