A question we posed to over 400 affluent investors in our recent survey: “Which of the following professionals would you most likely choose to oversee your family’s finances?” They overwhelmingly replied “financial advisor.”
Out of curiosity, I asked a group of financial advisors attending a workshop how they thought the affluent investors would answer that question: “Out of the following list of professionals, who would the affluent investor most likely pick to oversee their family’s money?”
The advisors thought it was the CPA. There was a look of astonishment on their faces when I informed them that only 7 percent selected a CPA. Half chose a financial advisor. Financial planner was the second choice at 27 percent.
In the words of one attendee, “Financial advisors rock!” This doesn’t diminish a CPA’s or estate attorney’s expertise, but it does provide a clear signal that the affluent perceive today’s financial advisor as the quarterback out of all of these financial experts.
Back in February 2010, The New York Times ran a feature article by Paul Sullivan with the headline, “Brokers? Advisors? What’s the Difference? A Thin, Often Blurred, Line Divides the Ranks of Financial Professionals.” Much has changed in five years.
In a separate section of our summer survey, we asked, “Has your financial advisor helped you create a financial plan that you are following?” Seventy-one percent said yes. Does this imply that today’s affluent want to work with financial advisors who also provide financial planning? I think there’s a direct correlation.
We’ve been researching affluent investors for the past 20 years and long ago uncovered the fact that they wanted a professional to quarterback their financial affairs. But as reported by Sullivan in his 2010 article, they had trouble distinguishing between financial advisors and stockbrokers. These most recent findings suggest that distinction is no longer lost on investors.
Like all elite advisors, you must hold your professional head high around CPAs, attorneys and other professionals who work with the affluent. Then show your professionalism with two simple steps:
Interact face-to-face with the CPAs of your top 25 clients, whether socially or in a business capacity. Your strategic intent during that interaction is to offer to show them what the client experiences in your office. In other words, you’re going to take them through your review process as if they were the client.
It’s important to deliver this suggestion with confidence. After all, you are two professionals with affluent clients in common. Think of making this suggestion to one CPA a week.
Not every CPA will become a referral partner, but some will. The immediate objective is to rebrand yourself to CPAs one at a time, through experiential learning.
Increase your time spent socializing with the affluent. The more time you spend with the affluent, the more opportunities will come your way. Recent market volatility has created anxiety and prompts questions, which is a perfect window of opportunity for the prepared financial advisor. You might get asked, “What’s going on in the markets today?”
After expressing a brief thought or two, you might reply, “What’s your financial advisor been telling you?” or “How’s your financial plan been holding up?”
When executed properly, this type of response makes sense, as it comes across as thoughtful—you’re focused on them, not showcasing yourself.
Once you have their attention, suggest in a conversational tone that they come to your office, where you’ll help them see how their family’s finances are handling the recent market pullback.
These two action steps require you to be proactive and courageous. But this is your time. Keep in mind your new mantra: “Financial Advisors Rock!”
