The best advisors combine rigorous technical aptitude with strong empathetic skills. They operate flexible practices that serve clients well today while following a plan to ensure viability in the future. They believe in their expertise, but they’re modest enough to shift gears when their original plans don’t exactly work out.
A shining example of this paradigm is E|Financial Alliance and its managing partner, Mitch Anderson, which operates three offices in the Nashville area. Anderson calls himself a “recovering corporate finance executive” who felt a calling a decade ago to provide financial planning to individuals.
But when he mentioned his career-changing plans to his business-owner mentor, the mentor suggested that the world really didn’t need any more “financial advisors.” Instead, he suggested Anderson become a CFP.
So he did, studying for the designation alongside a number of FAs from firms like Merrill Lynch and big Tennessee banks. As one of only two independents in his class, he came to realize what his calling should — and shouldn’t — be.
Beyond serving individual clients as a fee-only planner, he also decided to offer consulting on pension plans: his corporate experience and year-long tenure at another planning firm after gaining his CFP convinced him that too many 401(k) plans were too high on expenses and too low on education for employees. Building better 401(k) plans, he realized, could effect greater financial health among hundreds of plan participants.
Anderson and his partner Destin Tompkins combine their intellectual chops (Anderson is a CFP and MBA with a bachelor’s degree in engineering; Tompkins is a CFA and CPA with a master’s in accountancy) with a keen desire to better serve clients. Their approach is to gain a deeper understanding of clients’ goals and dreams through the use of enneagram personality profiling and by determining their preferred “love language,” as found in Dr. Gary Chapman’s writings.
You might think it odd for a sentence to combine the terms CFP, CFA, MBA, engineering and accounting with a concept like “love language,” but for Anderson and Tompkins it makes perfect sense.
More to the point, it makes perfect sense to clients, because determining how a client prefers to give and receive love allows E|Financial Alliance to show clients “we care about them in a very tangible way,” says Anderson. But true to their technical DNA, the partners aren’t just talking about ‘love,’ they’re building a database within their seven-year-old firm of their clients’ preferred love languages. They then communicate regularly with their clients following those preferences.
For example, one of the ways people prefer to show love to others is to give (or receive) tangible gifts. If that is a client’s preferred love language, E|Financial Alliance will send them a small gift annually. The benefit to the firm and the clients? “If people feel loved by you,” Anderson says simply, “they’ll follow your advice. And regardless of how big a client is, whether we get $5 or $25,000 in revenue from them, they love it!” E|Financial Alliance’s top line has benefited as well. Since implementing its client love program, “our referral rate has risen 50%” Anderson explains.
Understanding clients’ personality types, says Anderson, “allows us to have empathy for them; a robo can’t do that, can’t process that through an algorithm.” Another business benefit arising from empathy is that the firm now counts many psychotherapist clients referred by other therapists.
Those referrals reflect the ‘Alliance’ part of the firm’s name: allying not just with attorneys and CPAs, but with other helping professions, like pastors and therapists.
As for how to keep E|Financial Alliance growing, Anderson says “our future is in behavioral finance.”
That means implementing ways to electronically and efficiently (the ‘E’ in E|Financial Alliance) deliver rewards to clients who take actions that improve their financial health, similar to what the Acorns app provides.
For Anderson, weaving together technology and empathy reflects not only their preferences, but points the way to future success.
James J. Green, a former editor of this magazine, is editor of Jamie Green Reports, an advisor-focused writing, editing and shepherding service. He can be reached at firstname.lastname@example.org.