How to Be a Successful Financial Advisor For Your Target Clients | Financial Advisors

Kizzy D. Blount

To outsiders, the financial industry may seem like it’s all about the money, but any successful financial advisor would tell you the clients come before the money. This has never been more true than today when clients are demanding more than just investment guidance from their advisors. To be a successful financial advisor in today’s market, you have to be prepared to stretch yourself into new and deeper areas.

“The world has changed, and client expectations have changed,” says Stan Gregor, CEO of Summit Financial. “As advisors, we need to adapt and change the way we run our practices.”

Here are four strategies to be a successful financial advisor in today’s world:

  • Have deeper conversations about more than money.
  • Adopt a partnership model.
  • Offer tax planning services.
  • Use timely and creative strategies.

Have Deeper Conversations About More Than Money

“Today’s advisor must play a variety of roles that begin with money, but do not end there,” says Joe Coughlin, director and founder of the Massachusetts Institute of Technology AgeLab.

The MIT AgeLab and AIG Life and Retirement surveyed more than 2,000 clients between ages 30 and 75 on what drives their satisfaction with their advisors. According to their findings, compiled in “Future of Client-Advisor Relationships,” client satisfaction and trust in an advisor increases when the advisor engages them in deeper conversations.

“Investors are expressing a willingness and desire to push traditional conversation boundaries with their advisors and to have wide-ranging, deeper discussions,” says Kevin Hogan, executive vice president and CEO of AIG Life and Retirement.

As money management is increasingly being viewed as more mechanical than relationship-based, investors are looking for that something more. They want to connect with their advisors on a personal level and feel a sense that their advisor gets them, Coughlin says.

“Ultimately, an advisor who is able to delve deeper will not just deepen their relationship with a client, but also raise issues that a client needs to address with their partner and wider family circle,” Coughlin says. “For example, MIT AgeLab research has found that clients, often men, have one set of goals and risk tolerances that they had just assumed their partner agreed to, only to find in a broader conversation with an advisor facilitating that there were significant differences in views about future life plans.”

Investors, particularly in the younger generations, expect their advisors to help them with access to information or resources around broader topics, such as health and future care, identity theft and fraud prevention, housing, future goals and aspirations and work and career transitions, he says.

If that sounds like you’d need an entire encyclopedia of knowledge, don’t worry: “While no one expects financial professionals to be experts in all these topics, there is an opportunity for advisors to help investors identify areas of concern and then act as resource connectors to pair them with experts across their professional networks,” Hogan says.

Adopt a Partnership Model

The partnership model may become a future model for successful financial advisors. “Our study’s results suggest that many clients, particularly younger clients, are looking for a partner to help them anticipate challenges in the future and to provide entrée to solutions and other service providers to address those issues,” Coughlin says. “(Clients) are increasingly looking for someone that ensures their financial security and helps them address the many challenges they will face in the future, many of which the client has not even imagined.”

Having the right professional partners to back you can amplify your success, Gregor says. “Some of the most successful advisors have adopted a partnership model, wherein they bring in additional resources and experts to help create solutions for their clients.”

He says the upside for advisors who find the right partners is enormous. “When you work into a partnership, the results you can achieve far exceed what you can achieve on your own.”

The best way to determine which partnerships will amplify your success is by learning what your clients need and want from you. Invite them “to discuss nonfinancial topics where they’re seeking guidance, and then act as resource connectors to pair clients with the appropriate experts and information,” Hogan says.

Offer Tax Planning Services

If there is one concern that transcends generations, it’s taxes. So if you want an easy way to appeal to investors of all ages and stripes, consider enhancing your tax planning offering.

“The one thing everyone is trying to do is to minimize expenses, and one of the largest expenses one can face is taxes,” says Ryan Serrecchia, a certified financial planner and executive vice president and partner at EP Wealth Advisors. “Minimizing taxes in the accumulation phase or distribution can help money last as long as possible.”

Simply adding tax planning or preparation services to your offering can add depth and make it a “portfolio of services,” he says. This will “open opportunities to align with investment strategies and financial plans and help clients who may be in need of those services.”

Providing tax services can also help investors see your value as more than just investment management. “It shows depth in the plan and helps build the trust to have longer and deeper relationships with clients,” he says.

Use Timely and Creative Strategies

All of that said, the money does still matter to today’s clients. But to compete against the robo advisors, human financial advisors need to provide strategies that an algorithm cannot. According to Gregor, this means providing timely and creative solutions.

He sees four areas as being especially important in today’s environment: low interest rates, navigating uncertainty, providing access to refined investment approaches and offering efficient solutions for wealth transfer and preservation.

“The Federal Reserve is clear in its plans to keep rates low as the economy continues to suffer impacts from the global pandemic and investing in a low rate environment deviates from traditional investment strategies,” he says. “Investors are seeking advisors who understand the complexities the current landscape presents.”

At the same time, investors are seeing unprecedented levels of market volatility, requiring a disciplined and informed strategy to navigate it. “Advisors can show their value in these types of environments with strategic investment approaches,” Gregor says.

Investors are also looking for more refined investment strategies and ideas, he says. They want to do more with their portfolios than just grow their wealth. ESG and socially responsible investing are a prime example of this. Advisors who can broaden their offering into these more impactful areas are likely to thrive with investors.

Finally, the “great wealth transfer,” which is expected to include upwards of $68 trillion being passed from baby boomers to their millennial children, is likely to be a key concern for investors in both generations, who will need expert advice to ensure the money is handled properly, Gregor says.

“Our advisors lead with financial planning, which is key to long-term success, but it’s not enough to make the plan,” he says. “Rather, it’s about how the plan is executed and how well the advisor can act upon the requirements from the plan, from risk management to investment strategy, to trust and estate planning, to family wealth and more.”

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