Week 10 Flashcards
Define Intention-action gap
Intention-action gap: that is an inconsistency between what people plan to do and what they actually do.
- The gap results in a segment of financial planning clients who have every intention to act, but simply fail to do so.
What is the Dual Process Model
Dual Process Model
- Think of a person as having two internal agents:
- The Planner – thinks long-term and sets future goals
- The Doer – focuses on immediate pleasure and short-term desires
The Conflict:
- The planner wants what’s best for the future (e.g., save money, eat healthy)
- The doer wants what feels good now (e.g., spend, indulge)
- Since the doer is myopic (short-sighted and self-focused), they often ignore the planner’s goals, leading to inner conflict
Two gaps between intention and action have been identified. Gap One and Gap Two.. Define them
- Gap One: potential clients who WOULD LIKE to get plans written but fail to do so.
- Gap Two: clients who GOT plans written but fail to implement them.
We call Gap 1 the intention-gap action and Gap 2 the implementation gap.
What are the potential causes of Gap 1 and Gap 2
Gap 1: Client hasn’t started planning yet
Why it happens:
- Procrastination – They intend to plan but keep putting it off
- Unsure of the procedure – They don’t know how or where to start
- Problem feels distant – Future issues (like retirement) don’t feel urgent
- Benefits seem vague – They don’t fully see the value of financial planning
- Fear of the unknown – The process feels unfamiliar or intimidating
Gap 2: Plan exists but action isn’t taken
Why it happens:
- Licensing effect – “I made a plan, so I’ve done enough”
- Overchoice – Too many options overwhelm them
- Conflicting goals – Competing priorities (e.g., retirement vs. education) stall progress
- Procrastination (again) – They delay even when they know what to do
- Lack of salience – They doubt the value or trustworthiness of the plan or planner
- Ambiguity – The process feels unclear or open-ended
- Information complexity – Too much or too confusing info = decision paralysis
researchers divide people into 3 behavior change segments based on how they respond to intentions ((Intention-Action gap (Gap 1))
-
Motivated Enthusiasts
People who make sure they act the soonest possible opportunity
— no strategy needed, keep encouraging -
Die-hard Opponents
People who resist change due to strong beliefs or values
— use education and evidence over time to gradually influence them -
Naïve Intenders (largest and most overlooked group)
People who believe in the purposal (of plan) and want to act, but fail to follow through
— use behavioral supports, like nudges, reminders, defaults, and structure to turn intention into action
researchers divide people into 4 behavior change segments based on how they respond to implementation ((Implementation-Action gap (Gap 2)))
1. The Non-Starters
They have good intentions but take no action.
💡 Planner Solutions:
- Provide a roadmap – Make the goal more visible and motivating
- Limit goals – Help clients focus on fewer, clearer objectives
2. Early Enthusiasts
Start strong but lose motivation over time.
💡 Planner Solutions:
- Offer regular progress updates
- Encourage precommitment to next steps
3. Lost in the Woods
Make some progress but lose direction or belief in the plan.
💡 Planner Solutions:
- Visualize progress – Help clients see how far they’ve come
- Simplify choices – Reduce complexity to prevent overwhelm
4. Fully Compliant Clients
Stay engaged and follow through.
✅ Success Strategies:
- Keep motivation high from start to finish
- Show progress – Let clients visualize their journey
- Include “when-how” – Not just goals, but when and how to act
- Make goals relatable – Tie to personal life (e.g., “when your kids graduate”)
- One battle at a time – Focus on one goal to avoid overwhelm
What are 2 approaches to using behavioral insights to improve practice
-
Behavioral insights as problem solve — identify behavioral problems and solve them using choice architecture
○ As a problem solver we apply tools to diagnose existing clients and change behavior by using potential interventions -
Behavioral insights as a designer — redesign the product and process to minimize the behavioral problems in the first place
As a designer we apply tools to change the practice for new clients and prevent dropout
What can planners do differently to help clients act on a written plan? [2 ways]
Packaging the Plan
1. Presenting the plan:
§ the planner needs to determine how the plan is presented to the clients. Should the plan be written in concrete versus abstract language? It might not be the same answer for every client.
2. Design of the plan
○ Should the plan be a consolidated detailed plan or a collection of shorter-term, more brief plans?
3. Medium of Choice
○ Will it be an emailed pdf or a physical copy mailed or handed to clients?
Ongoing communications
1. Timing
○ When is the right time to remind or reach out to the client?
2. Medium
○ How do I communicate? Through email, meetings, social media, or phone calls?
4. Choice architecture
How do I embed positive choice architecture in the ongoing communication? Specifically, how can I frame my messages so they elicit action?
Research indicates that of those in need of change, only “” “” “” are ready to do what is necessary to make such changes. [actually do the plans they were assigned]
1 in 5
What factor determines if clients will embrace their plan
A client embracing change [their plan] comes down to their readiness to change and their planner’s ability to assess that readiness.
- Some clients are just not ready for change yet
Why might clients not be ready for change?
There’s 6 stages of the change process
-
Pre-contemplation stage (Denial Stage)
○ Client’s mindset: Unaware there’s a problem.
○ Example: Piper comes in to open an RESP, but the planner sees she’s paying huge credit card interest. Piper hasn’t realized her debt or spending is an issue. -
Contemplation
○ Client’s mindset: Aware there’s a problem, but not ready to change yet.
○ Example: Piper acknowledges her overspending is a problem but hasn’t committed to changing it. -
Preparation
○ Client’s mindset: Committed to change and starting to plan.
○ Example: Piper starts imagining a debt-free life and prioritizes solving her financial issues. -
Action
○ Client’s mindset: Actively changing behaviour.
○ Example: Piper cuts up her credit cards, stops using credit, and begins paying off debt. -
Maintenance
○ Client’s mindset: Sustaining new habits, avoiding relapse.
○ Example: Piper sticks to her new spending habits. If she slips, the planner reminds her that relapse is normal and encourages her to return to good habits. -
Termination
○ Client’s mindset: The change is fully integrated; no temptation to revert.
Example: Piper no longer uses credit cards and only buys what she can afford with existing funds.
Clients can’t and won’t institute sustained change until they believe that change is “” and are “” they can do it.
important, confident
What are the 3 key Listening Techniques
-
Three Yeses Technique
Stay silent and gather information while the client talks
Then summarize three key points the client said in a way they’ll agree with
✅ Helps reinforce the client’s own arguments and boosts readiness for action -
One Word Approach
Try to sum up the client’s message in one powerful word (or short phrase)
Gets to the core emotion or theme behind what the client is saying
Example: If a client talks about their kids and long-term goals, the planner might say: “Legacy?” -
Sandwich Technique (Ask–Tell–Ask)
A respectful way to offer advice while staying client-focused:
Ask what the client already knows
Tell them your advice or information
Ask what more they’d like to know or how they feel about it
✅ Encourages dialogue and avoids sounding too directive
What are the 10 elements that affect the Change Process
- Facilitator’s Expertise: The planner’s actions can speed up or stall change.
- Ambivalence: Normal part of change; clients are both for and against it.
- Avoiding Confrontation: Direct, forceful advice increases resistance.
- Understanding Resistance: Resistance is caused by feeling pressured.
- Internal Motivation > External Pressure: Sustainable change comes from within.
- Getting Stuck: Normal; facilitators need tools to help clients move forward.
- Reinforcing Internal Motivation: Focus on supporting the client’s own drive.
- Avoiding Passive Compliance: Agreement without action is a subtle resistance.
- Avoiding the “More Information” Trap: More facts don’t resolve resistance.
- Preparing for Relapse: Normalize setbacks and create a plan for bouncing back.
