It’s important to understand the big picture and how to make money as a financial advisor.
Your goal is to have face to face meetings with prospects who meet two criteria:
1. The prospect has money in their control (i.e. not tied up in a 401k)
2. The prospect is interested in opportunities to do better with their money
If you have any additional criteria, you will lose money as an advisor. For example, if you have a third criteria that the prospect have interest in annuities because you sell annuities, this will cost you a lot of sales because there is NO PROSPECT who cares about annuities. Prospects care about their objectives such as
1. Safety of principal
2. Tax relief
3. Liquidity
IT’S YOUR JOB TO SHOW PROSPECTS HOW THEIR OBJECTIVES ARE CONSISTENT WITH YOUR PRODUCTS AND SERVICES. THEY DON’T COME TO YOU INTERESTED IN ANNUITIES OR MANAGED ACCOUNTS OR ANYTHING ELSE OTHER THAN THEIR OBJECTIVES.
Most advisors miss this concept and rather than focusing on the maximum number of appointments with prospects who meet the two criteria above, the advisor will call the prospect to determine their interest in annuities, managed money, life insurance , etc. But such a call makes it obvious to the prospect that your interest is in YOUR PRODUCTS AND SERVICE and not their objectives. That’s why you don’t get the number of appointments you should.
Let’s provide an example. We run a lot of ads on the Internet to find consumers interested in financial topics. The ad which got the all time best response was for a booklet about ways to increase social security income. This is a HOT TOPIC for seniors. But every advisor told us “I don’t want those leads. I can’t make any money talking to people about social security.”
This is unfortunately a near sighted view that keeps most advisors poor. Many of these prospects meet the two criteria above but because the advisor is SO FOCUSED ON THEIR OWN AGENDA, THEIR OWN PRODUCTS AND SERVICES, they will never have an appointment with viable prospects who could become good clients.
Focus on the big picture–meet with people you can help and don’t focus on your products and services. They are merely tools to help people accomplish their objectives, tools that don’t need to be discussed until the last 10% of your conversation.
Financial advisors have a tendency to forget who stands at the base of the economy – common people in need of social security, people who need to know how to plan their economies. That’s why this crisis blew up. People can’t plan their future anymore and nobody seems to care.
You are right! So many miss the big picture and waste precious time and resources. The objective-focused model is what we use in our internet marketing plans. Managing a marketing campaign by objectives is the only way to go. Always remember that customers are focused on What’s In It For Me (WIIFM). Answer that, and you are in the door. Otherwise, you get shut out.
Thanks for the nice article!
I think people tend to stick to what they know and are most comfortable doing when they are makerting. We are working with a company that have always gone after only very high net worth clients. That has made them a success and they have done very well, but they really don’t know how to woo a different type of client.
When the recession kicked in their funds under management dropped, taking them further away from their goals and meaning they had reached a plateaux.
Marketing to new types of clients often needs new processes and new thought patterns. The company in question have partnered with another company more experienced in marketing to the masses. They really didn’t need a partnership, but I think this illustrates the mentality of some financial advisers and how they can get focused on their niche.
Thanks for the article. Really interesting!
Very interesting post. Social Security is a hot topic and has been that way for several years. There is a definite market for entrepreneurs to hit in that area.
Working with customers on an ongoing basis, giving support and advice even when it doesn’t lead to a sale, is the best way a financial advisor can do well in the long term.
Spend time to build that rapore and trust factor with them and they will beat a path to your door rather than you going to find them.
Don’t just concentrate on the sales. Concentrate on the service and the sales will follow – for years to come too!
It depends on weather those leads are near retirement and concerned about social security or people without any money trying to learn how to scam the system. Your advertising wasn’t the all time best if it didn’t produce valuable leads.
Great points but it is important to be seen as an Investment Adviser that is held to a fiduciary standard. A Financial Adviser held to a Fiduciary Standard occupies a position of special trust and confidence when working with a client. As a fiduciary, we are required to act with undivided loyalty to our clients. This includes disclosure of how we are to be compensated and any corresponding conflicts of interest.
Great post thanks!
I never encountered a financial advisor before but after reading your post, it seems like I’m more of the financial advisor myself.
When evaluating your financial situation, if you focus on your invested assets you may be missing the bigger and more meaningful picture. A financial advisor should be known for something. Create a reputation by being known for a specialty area and tie this into your target client. Your referral sources, clients, and friends need something to wrap their minds around. This strategy not only draws business to you, it boosts your income.
Its not surprising to find financial advisors whose focus is not retail investors rather than on their fellow fund managers
Financial advisors are very helpful when you really don’t have time for your business anymore.! They are professional in what they do, so you can have 100% positive results.!
You are spot-on! I have experienced this exact situation in my NY Divorce practice when being the liaison between my clients and their financial advisers. Knowing a thing or two about investment strategy I often catch financial advisers making decisions that are in their best interest rather than my divorce clients’ best interest. I am their advocate so I am under a duty to confront such incongruities. Thank you for pointing out some of these issues! People can certainly benefit from this information.
i do not work as a financial advisor, but I think what you said here is informative as well as reasonable. I highly agree one sentence in your post: SO FOCUSED ON THEIR OWN AGENDA, THEIR OWN PRODUCTS AND SERVICES. I think it is right to do that.
Good and excellent financial advisor should remember :
1.Learn new things and stratages all the same,always be a professional one.
2.Remember the source of your money,try your best to help others professionally.
Your blog is very impressive and this is an excellent article. As you have pointed out wisely the main things that are missed out by financial advisors, I think if the entrepreneurs are taught to think out of the box and coming up with new ideas in utilizing the resources and marketing plans properly, there is a weak point to get lost of track
Most advisors miss this concept and rather than focusing on the maximum number of appointments with prospects who meet the two criteria above, the advisor will call the prospect to determine their interest in annuities, managed money, life insurance , etc
Unfortunately most financial advisors make such a mistake. The time has come to change a standard approach that became obsolete. And main principles you pointed in the article are just the beginning.
My first experience with a financial planner was a poor one. All he did was look over what we have planned. (IRA, Life insurance, 401k etc) and just say Yep you are on track, follow your budget and put this money in a savings account/CD and you will have $X by time you are 40 years old. As a Actuary student, I found the information kinda useless. All he did was give the time value of money of monthly deposits. He didn’t even suggest a plan for the money short of the already existing IRA/401K.
He missed the big target (which was told to him a couple times) that we were there for a reason, to figure out where to plan and invest our money that was sitting in a bank account, but even when we asked what the average return on their products he couldn’t even ball park it.
I know all financial planners are like this, and hope to some day have a good one when I go back, but it did leave a bad taste in my mouth.
It’s hard to find a good financial planner that has your goals and objectives in mind instead of his or her own objectives and goals. I found the key to finding a good financial planner is how they conduct the meeting on your first visit. If they don’t push something on you and instead ask what you’d like them to help you with, you know you’ve got someone you can continue working with.
Nice article and well written. I think the key point here is that too many people out there go for quantity not quality and to achieve this everyone they adie gets a one size fits all solution.
Thats often the problem. People feel it if you want to sell them something. As a financial advisor you have to choose quality over quantity (less appointments but you give more value).
This way you will also build a “name” over time and people will come to you.
Thanks for the article!
The crisis was caused by the lack of planning, meaning that the financial advisors don’t care about the common people, which area the foundation of the economic stability.
I have never met a financial advisor who “got” the big picture.
Focus on the customer needs first, rather than your own and your satisfied customers will produce more business. Quantity of satisfied, trusting customers creates a quality income for you.
Many financial experts believe you will see the big picture. However, what often prevents sees the big picture others want to..
That is a great idea. You can also do the same when transfering iras and other retirement accounts from one broker to another.
I had bad experiences with financial advisers , and lot ( for my wallet) big. If they are so clever about the market, why are they working as financial advisers in the first place?
It is like all the analists you hear on television. If their predictions are so wonderfull, why are they still working?They just cover themselves
There are honest financial advisors out there.. it just takes time to find them.
I found this blog informative. The way you describe each and every point step by step is great and easy to understand .Now-a-days everybody needs financial advisor who helps them in taking financial decesion.Thanks for sharing.
Excellent point about what investors care about – “safety of principle”. I bet this is top of the list with what so many have lost in the last two years. Excellent “straight to the point” post I wish financial advisors overall could ahere to.
Finding the right financial adviser is difficult because so many people are allowed to become one. Even ones without experience, just pass a test and you are certified.
As with any profession, there are good financial advisors and there are not such great advisors. Therefore, the investor should have some background and basic understanding in the financial arena and not trust solely on the advisor’s guidance.
Yes, advisors often become pre-occupied with the products or systems they are selling. Advisors need to become more sensitive to the needs of the client.
Great post financial adviser, investors would love to read your post.
Totally true. You have to wonder why a lot of these advisors are giving advice on how to invest instead of doing it professionally for themselves. I’ve met a few good ones, but most of them are just looking to churn trades for commissions.
The company in question have partnered with another company more experienced in marketing to the masses. They really didn’t need a partnership, but I think this illustrates the mentality of some financial advisers and how they can get focused on their niche.
Financial advisers do the best they can. But the market can be volatile. There’s always going to be risk.
So true! I have dealt with quite a few advisors who did the same mistake….I would like to see them lasting in this business for a long time with this sort of approach! Probably not for too long…
This is an excellent idea. You can also do the same when you transfer and other retirement accounts from one agent to another.
I completely agree – financial advisers could be great for you – but if you dont change you habits – no financial adviser will help you out of you debt.
There are all sorts of reasons why you might choose to do this: lack of interest in personal finance, lack of time to study it or circumstances requiring urgent action, to name a few. No matter the reason, a financial advisor is a must if you cannot or will not manage your own money.
Great post,
You hit the nail right on the head in saying that its our job to show our prospects how their objectives/needs meet and suit what our products can offer.
Also, thanks for highlighting the importance of a financial advisor, I never knew how important their role is to the success of a business.
Your blog is very informative and impressive. I have not encountered a financial advisor before, but after reading your blog, i think people needs a financial advisor who will help them in taking financial decesion.
Legal and financial advisors are not always sufficiently knowledgeable or well-trained to implement the right strategies and right techniques required to accomplish the task of 100% asset protection. Individuals should simply learn for themselves what it takes to protect both their personal and professional assets.
Your blog is very impressive and this is an excellent article. As you have pointed out wisely the main things that are missed out by financial advisors,
Spot on here, sometimes advisors can be great but you’ve always good to be careful who to trust and who not to trust with your money.
I think that both the advisor and the client must be on the same page. Only then when they have a common set of goals and risk tolerance levels will they make a good team.
You hit the nail on the head. Too many financial advisors want the quick buck. Make a sale and move on.
Building a relationship, a trusted relationship takes time. What better way then to help them solve their problems!
Yes this is exactly true. You have to focus on the needs of the customer. If they don’t align with your financial products or services, you are trying to force a sale and your sales rate will suffer for it!
very good post i like it social security is a very good topic