(San Diego) Commonwealth Financial Network highlighted both practical and emotional ways financial advisors can grow their business during the turmoil of 2009 at its recent wealth management symposium, held in mid-March at the Westin Gaslamp Quarter hotel in Southern California.
There were about 115 independent advisors and some 30 staff attending, and topics included risk management, practice management and financial planning.
“Market turbulence can make things tough for financial advisors,” says Wayne Bloom, the broker-dealer’s recently tapped CEO. “They tell me that they have to be here to move forward, so when the market turns, they have a better practice in place.”
As for technology, Commonwealth has platforms for advisors and for clients (Client 360 and Investor 360). But it aims to roll out a wealth-management platform within the next 12 months that can be shared with accountants, lawyers and other professional partners online. “This is in the cue,” Bloom says.
“We want to service advisors that want to run their business as wealth managers, but as a broker-dealer, we have to show leadership.” Incorporating aspects of consultancy CEG Worldwide’s business model and practice-management techniques are part of this effort, he adds. “Wealth management is worth embracing as a core competency.”
At the conference Patricia Abram, a senior managing principal of CEG, stressed the need for advisors to spend 60 percent of their time or more with clients. She also advises that FAs construct a grid that breaks down clients by type as a first step in “driving revenue.”
“This is really about putting a premium on direct communication with clients,” shares Bloom, “while becoming more efficient.” With some 460 staff for 1,300-plus advisors, the broker-dealer strives for a similar strategy, he points out.
“We have been stressing practice management for 20 years in order to help advisors get better and to teach them scalability,” explains Bloom. “Our advisors are independent, which is the key word. We don’t tell them what to do. Rather, we give them great choices.”
“These are really our selling points — productivity, service and outsourcing in areas of practice management, information technology and other areas,” he explains.
Commonwealth raised its target for yearly gross-dealer concession (or sales) for recruiting purposes two years ago to $200,000. And in the first two months of 2009, according to Bloom, the average GDC of recruits was $410,000.
Kurt Whitesell, CFP and president of Whitesell Financial Group in Rapid City, S.D., says he was particularly impressed with the talks given by Kol Birke, a specialist in technology and in psychology at Commonwealth. In one presentation, Birke focused on the need for advisors and clients to focus on what they most hope for.
“This really spoke to me,” says Whitesell. “I needed someone to tell me it, instead of just telling it to myself. The news is so negative, so we need to focus back on the things we can control. And we need to deliver this message [of hope] to the client. These are the times when we earn our money.”
Whitesell joined Commonwealth two years ago from Waddell & Reed. His practice, based in a historical building that he owns, has about $40 million in assets under management. Clients are mainly individuals who run their own businesses, including ranches and farms. “I do a lot of financial and estate planning, and want to create even more opportunities for clients,” he says.
The top concerns of clients today, he says, are their lower portfolio values and returns. “Though people are well allocated and have fixed-income investments, they are still in a panic and think all of their money is in the market. So, we focus back on helping them really grasp what they are doing with their money,” Whitesell shares.
To help educate clients, Whitesell is making more contact with clients via monthly market updates, quarterly newsletters and seminars. “We get most clients via referrals,” he says. “We work with clients to help them find peace of mind, and we hope they’ll bring others to our meetings.”
At the recent Commonwealth event, “I got the helpful experience of West Coast and East Coast opinions, of seeing what’s happening in their economies. In South Dakota, we haven’t been hit by housing-market issues since prices didn’t run up as they did elsewhere. We have steady values and population,” he explains.
“I also got to network with lots of great people” in a nice, sunny and warm environment, says Whitesell. “South Dakota can be a bit of an island. There are 1 million people in the state,” he explains. “But it’s great when we get support and people come out to see us or even talk by phone.”