Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Practice Management > Compensation and Fees

7 Things Your Friends Should Know About Your Business

Your article was successfully shared with the contacts you provided.

“I didn’t know you did that! You never told me!” How often has a friend told you they bought something from a competitor? They had a terrible experience. You counter “I do that. Why didn’t you come to me?” Somehow your response puts the blame on you for not telling them. This stops now.

1. Explain what you do. Years ago, stockbrokers sold stock. Bankers made loans and insurance agents sold insurance. Now, if it fits into financial services, everyone does everything. Get that point across.

Myth busted: You aren’t a stock picker. You are a relationship manager.

2. How you do business. You have a process. You explain it. You show how financial planning has an investments, insurance and lending track, if necessary.

Myth busted: You don’t slap the product of the day into a client’s hands. That was so 1970s!

3. Training/experience. If you are new, this can be a challenge. Sell the firm. If you are part of a team, sell the team’s combined experience and specialization.

Myth busted: If you are new, you aren’t going to practice on them until you develop your skills.

4. Number of clients. Let them know the number of households in your practice. You can know each person personally and develop a relationship. You care about them. How often do you keep in touch?

Myth busted: You are not at the other end of a customer service line. You are not an asset gatherer who relationship ends when the prospect becomes a client.

5. Size of relationships. Ever notice how “high net worth” often sounds like “more money than you’ve got?” If they ask about your minimum and you throw out a number, it’s an “either/or” scenario. You fit or you don’t. Try using a range instead. Talk about total assets, number of relationships, average size and your smallest and largest relationships in dollar amounts.

Myth busted: Will I be too small? If I fall below the dollar threshold, I’m insignificant.

6. Priced fairly. They will want to know about price! You cannot pretend wealthy people think it’s crass to talk about fees. Of course they talk about them! How do you think they stay wealthy? You need to explain the cost within the context of what you do for the client. Remember: Although investing should be a long term relationship, asset-based pricing is the ultimate “pay as you go” pricing model. No big upfront charges or surrender fees.

Myth busted: If you live a nice lifestyle, your friends might assume you have a clientele of people with no price sensitivity who you soak with high fees and commissions. You are priced fairly.

7. Service- and relationship-oriented. You understand your client’s situation because you invested the time to develop a comprehensive financial plan together. You will make suggestions consistent with their objectives, explain the rationale and work together to monitor progress to goals. You are trying to make this part of their life easier.

Myth busted: You aren’t going to tell people what to do, communicating “It’s my way or the highway.”

At this point, your friends should have a good idea of what you do. They should also have enough information to answer simple questions if they spot an opportunity and bring up your name.

More important, they can think about their own situation. Are you in a position to help them? Should they become your client?

Bryce SandersBryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book “Captivating the Wealthy Investor” can be found on Amazon.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.