Why would I invest with you?

2 replies [Last post]
Renter's picture
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Joined: 2007-09-12

Hello again. I saw the article on CNBC re: Investors Dumping their Brokers & Go It Alone on Internet. This also happened in the late 90's when things were really good. It's interesting that now, things are really bad, and those advisors who are being left, what value did they offer? One of my clients told me "I can lose money all by myself; I don't need to pay you to do it for me."
I'll ask all of you the same question:
What value do you offer? If I bring you $10k in a mutual fund, do you set a goal & DCA, or just drop it in & forget about it? What if I'm 50 & bring you $100k that I don't need income from? What's your plan? How about $300k that I'll never spend?
 
What would you say if your $100k mutual fund client said "Your funds are down, I'm taking them to Schwab or Fidelity? Why would they stay with you?
 
Thanks.  -Renter

Jebediah's picture
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Joined: 2009-07-10

There is a study from Fidelity that shows investors with an advisor vastly outperform DIY investors.  Google it, show it to him and ask if he knows why this is.  When he says no, tell him your value statement and remind him why he doing business with you.  Or if you are feeling like a smart ass, tell him you can get sick under a doctor's care or all on your own, but you feel that with a doctor around, your chances of a full recovery are much better.

BerkshireBull's picture
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Joined: 2009-06-10

Renter wrote:Hello again. I saw the article on CNBC re: Investors Dumping their Brokers & Go It Alone on Internet. This also happened in the late 90's when things were really good. It's interesting that now, things are really bad, and those advisors who are being left, what value did they offer? One of my clients told me "I can lose money all by myself; I don't need to pay you to do it for me."
I'll ask all of you the same question:
What value do you offer? If I bring you $10k in a mutual fund, do you set a goal & DCA, or just drop it in & forget about it? We'll get you setup in a nice Asset Allocation Fund buying and call you twice per year and do an annual review.What if I'm 50 & bring you $100k that I don't need income from? Set it up in managed money or an annuity, your choiceWhat's your plan? How about $300k that I'll never spend?Set it up in a SPIA paying into an Irrevocable Life Insurance Trust and we'll turn it into $600,000 tax free for your heirs.
 
What would you say if your $100k mutual fund client said "Your funds are down, I'm taking them to Schwab or Fidelity? Why would they stay with you?If we've done our job they've outperformed their peers, and we've been reviewing them with you at least once each year.  If that's not enough for someone then what can you do to keep them?
 
Thanks.  -Renter

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