It’s no secret that the past few years have been challenging for financial advisors. Many are still reeling from the loss of investor confidence and drop in assets incited by the market turmoil of 2008. Even though we saw the beginnings of the recovery in 2009, numerous advisors are struggling to claw their way back to pre-recession production levels. Here’s the good news: It’s a new year, the recovery is in full swing, optimism is at a high, and you can make 2011 your best year yet! How? In this article, we are going to outline two specific steps you can take to ensure your success. Don’t discount these just because you may have heard them before. Taking these action steps now is one of the best investments you can make in the future of your business.
Define Your Goals and Commit Them to Paper
A first century philosopher said, “If a man does not know what harbor he is making for, no wind is the right wind.” How true that statement is! As financial advisors, we understand the value of setting goals better than most people. Think about how often we sit down with our clients to help them define their goals, outline a plan to reach those goals, and then monitor their progress to ensure they are moving in the right direction. It’s what we get paid to do. And yet, ironically, many financial advisors have never sat down and created tangible goals for themselves and their practice.
A recent study by Advisors Trusted Advisor shows that advisors who set regular, realistic goals for their practice are the ones who are most successful. However, only 37% of survey respondents said they satisfactorily set new business goals, and just 35% have written business development plans. Those who answered positively in these two areas said they were realizing "much higher" or "higher" numbers of new prospects and more overall satisfaction in business growth.
At this point, you should probably get out a piece of paper and a pen so you can write your goals down. Goals that aren’t on paper are only fantasies.
So what kind of goals should you have? First of all, you need a combination of short-term and long-term goals. While it’s fairly easy to focus on the big picture of where you want your practice to be in 10 years, you must first know where you want to be by the end of this year. And in order to reach your one-year goal, you should break it into monthly or quarterly goals.
The following are some solid goals you might consider adopting. Notice that they are specific, measurable, achievable and time-constrained, thus possessing the ingredients of manageable goals.
- By the end of the year, I will have $___,___,___.00 in assets under management.
- This year, I will reach a production level of $___,___.00 in GDC.
- By the end of the year, the net cash flow into my business will be $___,___.00
- I will lower my office expenses, thus increasing my profit margin by ___% by the end of the year.
- I will convert ___ referrals into clients by the end of the year.
As you will notice, all of these are annual goals. The next step is to break them down into monthly or quarterly segments. For example:
- Each month, I will reach a production level of $___,___.00 in GDC.
- Each month, I will seek out ___ referrals from existing clients, which, based on my closing ratio, will yield ___ new clients.
These are only a few examples of the types of goals you can set. Other goals may relate to the systemization of your practice, staffing needs, or your quality of life. Whatever your goals are, once you have committed them to paper, your next step is to develop a plan that will ensure you reach them.
Because time will not allow us to discuss every possible goal you could set, let’s take just one area of practice management and show how you could develop a worthwhile plan.
Increasing your production level through referrals – A Sample Plan
The second step to ensuring your success in 2011 is increasing your production levels through referrals. Building a steady referral stream doesn’t happen on its own. It requires that a specific set of steps be taken. In fact, if the proper foundation has not been laid in advance, asking for referrals can be an exercise in futility. So what kind of plan is required to help you get more referrals?
1. I will improve the level of service I provide my clients so that I will make myself more referable. To accomplish this, I will implement new procedures in my practice that will ensure a consistent, high-quality experience. I will implement the following procedures…