(Chicago) — Ensuring your advisory practice caters to multiple generations is no longer an option, but an important factor in determining success.

Karen DeRose would know. With accolades such as “Women to Watch 2015″ (InvestmentNews), ”5-Star Wealth Advisor” (Chicago Magazine), and Circle of Excellence 2011-2016 (WIFS), she has made a name for herself within the insurance and financial services sector.

Her story

DeRose learned the most important aspects of planning from her father, who owned his own successful insurance agency. For seven long years, she served as his mentor, splitting commissions 50/50 the entire way. 

In 1996, armed with every ounce of her father’s insurance and financial planning knowledge, she founded DeRose Financial Planning Group, a full-service firm located in Chicago. 

“We have three generations of family wealth advisors with one common goal: serve a family for generations,” DeRose said during a recent presentation during the Women in Insurance & Financial Services national conference. “My father, me and my son are in practice together. We focus on having a male/female team. Studies have shown revenue goes up 40 percent when that happens. My dad, who’s out of the practice, could easily bond with men. But me? I can’t talk about football.”

To bond with the younger generation of prospects and clients, DeRose brought in her son, Anthony. “My son bonds with my clients’ children — that’s the reason you want to have the next generation in your practice.”

Why a multi-generation practice?

“I turned 50 four years ago when I was attending a business success planning meeting,” DeRose said. Mentors were brought in to the firm to learn from us, but DeRose had a different mindset. She wanted to keep control.

‘No one knows the business better than me’ is what she told herself. But she quickly realized she needed to change her mindset if she was going to have a succession plan in place.

She also realized she needed to start immediately.

“I challenge all of you to start sooner rather than later and say to yourself, ‘Theyr’e not going to be me,’” DeRose said. “Let them be themselves. Impart your wisdom and mentor them. The proper way to train them is to bring them out on every client meeting. I wasn’t looking at it as growing my practice, I was looking at it as succession planning.”

The result? DeRose FPG’s revenue was $1.1 million when she hired her son one year ago. It’s now $2 million.

“If you’re going to bring someone in, forget training, mentor them,” DeRose said. “This is extremely important.”

To bond with the younger generation of prospects and clients, DeRose brought in her son, Anthony. "My son bonds with my clients' children — that’s the reason you want to have the next generation in your practice," she says. (Photo: iStock)

To bond with the younger generation of prospects and clients, DeRose brought in her son, Anthony. “My son bonds with my clients’ children — that’s the reason you want to have the next generation in your practice,” she says. (Photo: iStock)

Your clients’ children 

As we’ve covered time and time again here on LifeHealthPro, millennials (your clients’ children, perhaps) are being courted by easy-to-use and 100 percent digital investment services, such as Betterment or Acorns. But in the end, is it really the same? DeRose thinks not.

The robos are not going to give [your clients' children] advice when the world starts to get complex,” DeRose said. “You want to be the preson they’re going to call. Get to those children now.”

To drill the point home, DeRose shared a few statistics regarding the children of boomer-aged individuals:

    • They’ll be worth $30 trillion collectively in the next 30 years;
    • 66 percent of children fire their parent’s advisor;
    • 60 percent of clients are 60 years of age and older;
    • 90 percent of families lose wealth by the third generation.

“Have those crucial client conversations now and tell them you want to talk to their children,” DeRose urged. “Why did the client hire you? Don’t they want the same for their children?”

See also:

Business succession planning: Look to life insurance

The issue of succession planning

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