Every advisor should have a list of non-negotiables they expect from clients.Nuthawut Somsuk/iStockPhoto / Getty Images
Bringing on a new client is exciting. However, building a successful practice goes beyond trying to win every prospective client. Advisors should be just as intentional about finding the right client as clients should be about finding the right advisor.
That means taking the time to assess what types of clients you work with best. Whether that’s entrepreneurs, young professionals, executives or those approaching retirement, advisors should differentiate themselves by leaning into their strengths and finding clients who match their expertise.
Every advisor should have a list of non-negotiables they expect from clients. Basic requirements – such as expecting clients to be honest, responsive and open to discussion – should be made clear from the beginning.
To avoid issues later, some advisors may go a step further by requiring clients to update documents, including their wills, within a certain timeframe and ensuring all relevant family decision-makers are involved in every key conversation.
Before a prospective client steps through the door, advisors should have a plan for every step of their engagement process, detailed in an operations manual. Building repeatable steps for all parts of the process will lead to a professional, consistent experience that builds trust from the outset.
Those steps include how introductions are handled, who on the team is responsible for communication at every step, whether the first conversation happens virtually or in person, what information needs to be collected and how confidentiality is maintained.
Advisors who receive referrals frequently may find it useful to create an introductory e-mail template that existing clients can use to simplify and formalize the referral process.
Sending a short questionnaire and having a low-stakes introductory meeting before a more formal meeting can also help both sides assess whether they’re right for each other.
Ask the right questions
During the first formal meeting, advisors should use information from earlier discussions or questionnaires to personalize the conversation.
Presentations should be simple and give room for the client to speak about themselves, their experiences and their goals, rather than focusing only on what the advisor offers.
Asking open-ended questions such as “What brought you here?” or “What keeps you up at night?” can be a good starting point. From those broader questions, advisors can cover the following areas:
- Family: How do you and your spouse or partner make financial decisions? How do you plan to help children with education, housing and other major life milestones?
- Retirement planning: When you think about retirement, what does a good day look like to you? What concerns you most about retirement?
- Investments: What has shaped the way you think about investing? How did you feel during past market downturns?
- Insurance: What insurance coverage do you have in place and are there any risks relating to your family, business or estate that you’re particularly mindful of?
- Legacy: Do you have specific long-term legacy goals? Are your wills, powers of attorney, personal directive and other planning documents up to date?
The initial question rarely gets to the heart of a topic. Advisors need to keep asking deeper questions, monitor body language and stay curious as the conversation unfolds to get a full picture of the prospective client’s situation.
Sharing client stories, personal experiences and anecdotes is often an effective way to help people open up while demonstrating your expertise.
It’s also important to address unrealistic expectations as early as possible. Rather than bluntly refuting misconceptions outright, it’s better to reframe the discussion by asking about goals and intentions.
For example, if a prospect expects annual investment returns of 20 per cent without taking significant risk, the advisor can ask what they hope to achieve with those returns. In many cases, advisors can help them see why they may not need such aggressive expectations to achieve their goals.
After the meeting, advisors should always walk people to the elevator or exit. Usually, a change in setting gives people space to share something they didn’t mention in the meeting that could lead to additional insights.
When to pass up a prospect
Sometimes, advisors must make the difficult decision of not taking on a prospective client who isn’t the right fit. For example, a prospect may be looking primarily for portfolio outperformance while the advisor takes a holistic approach.
To make that conversation easier to navigate, advisors should set expectations early on that the process is about determining fit for both sides without pressure to sign any paperwork until both parties are willing to commit to the relationship.
If the prospective client came through a referral, the advisor should thank the existing client for the introduction, even if the referral didn’t work out. The advisor should explain, without sharing confidential information, that the prospect’s needs would be better taken care of by another advisor.
Susan O’Brien is a senior wealth advisor and founder of the Susan O’Brien Wealth Advisory Group at Richardson Wealth Ltd. in Calgary.