Profiles in Excellence
Senior Vice President of Advisor Education, Capital Group
Some of your best relationships with clients may be at risk unless the role you play in their financial lives is properly understood, explains Chris Gies, senior vice president of advisor education at Capital Group. Clients might think you are well equipped to help them at one stage of their lives but are less equipped to handle things as they change. This can potentially cause clients to lose faith in your relevance to them in the future. Gies explains why this is a real risk and how to manage it.
Chris Gies: Do you know the frame that your clients have you in? If not, or if you’re not sure, you may be putting your best relationships at risk. Let me tell you a quick story.
I got a call, not too long ago, from one of our long-term financial advisers. His name’s Mike. Mike works in the Northeast and he has a very successful practice. He called to tell me about learning a tough lesson from a really good client. This was a client with whom he’d been working for years, and together, he and the client had accumulated almost $20 million helping that client save for retirement.
Mike had been looking forward to a call from the client because they’d agreed the client would be retiring at the beginning of the year, and that they’d be restructuring the portfolio from one designed to save for retirement to one designed to provide income in retirement. You can imagine Mike’s shock and dismay when that call came in, but instead of the “doing business” call that he’d expected, it was the call that all of us as financial advisers have received and it’s the one we hate most to get. It was the “Dear John” call, and in this case it went something like this:
Client to Mike: Mike, I wanted to call you directly because I’ve got to tell you some bad news. I’m transferring all of my accounts to another financial adviser.
And when Mike gathered his wits and asked why, the client explained he’d come to the realization that he was about to make the most important financial decision of his life, and he felt like he owed it to himself to work with a financial adviser who was as expert in this upcoming phase of his life as Mike had been in helping him reach that phase in his life. And with that in mind, he was transferring all of his assets to another financial adviser who was a retirement income specialist.
The point? Mike was every bit as expert in retirement income planning as the FA who received his client’s assets, but he hadn’t made that clear to his client. As a result, Mike was placed in the saving-for-retirement frame and left out of the rest of the picture. The rest of the story is that Mike went to work and created a plan to communicate the breath of services he offers in a context of each of his top clients’ goals and priorities.
Ask yourself, “Do I truly understand my client’s goals, and have I anticipated their future needs?” And then, importantly, “Do they understand the expertise that I possess to fill their needs?” If you haven’t done this, you risk being left out of the frame you deserve to be in and, as a result, you risk being out of your client’s financial picture when their circumstances change and, frankly, when they need you the most.
Profiles in Excellence
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