ORLANDO, Fla. Many advisors shift their focus to keep high-net-worth clients happy but they can shift too far and lose their value in clients' eyes. They often forget that clients are looking for their unique services.
"What do you do best?" asks Katie Swain, director in the financial solutions group for Pershing at the firm's Insite 2015 conference.
Swain tells the audience of advisors that they must focus on creating their own niche before attempting to keep high-net-worth clients happy or even bringing them on as clients in the first place.
Here are five ways that advisors can attract and cater to high-net-worth clients.
1. Give the client individual attention. We found for high-net-worth individuals they really want that point of contact, say Troy Mertens, COO of Orgel Wealth Management in Altoona, Wis. They want to know who their person is.
Mertens firm designates one client associate and relationship manager focused on one wealthy client. He added that many members of his firm will pool their resources to aid a client, however it is the client associate who acts as the sole advisor for that high-net-worth client.
2. Take a leadership role. Your high-net-worth client absolutely looks to their advisor as a point person, says Swain. Bringing in a clients attorney or their CPA is a great way to have a virtual team. She notes that the client will appreciate the advisor's effort because youre initiating conversations that they may know they should have, but havent yet. One example of this is how advisors work with divorce attorneys, says Swain, who encouraged advisors to make this type of collaboration more of a habit.
3. Know who your clients should be. Before gaining a high-net-worth client, advisors have a tendency of losing sight of themselves and what theyre truly good at, says Denise Wypiszenski, president of Orchid Network. Its making sure that you know your story, says Wypiszenski. And that is the critical piece of running a wealth management business. If people dont get what you do its going to be difficult to have an interaction with those clients.
Mertens agreed, citing his own firm--which deals mostly with small businesses--as an example. They will one day want to figure out how to monetize their business, he says of his clients. He believes that his niche has helped bring high-net-worth clients to his firm.
4. Focus on liability management. Swain admits that when she worked as an advisor, she was guilty of thinking it was fine for her high-net-worth clients to simply get a loan at a bank. Dont do that, because then you open up that client to being cross-sold by someone that isnt you, she said. Look at what the options are for your client regarding liability management.
Swain further explains that advisors dont want to get a phone call from a client requesting to sell a million dollars in stock because they suddenly want to buy a life insurance product. There are ways for advisors to leverage securities as collateral for high-net-worth clients instead of liquidating assets, she said. This goes hand-in-hand with estate planning.
5. Use technology. I know advisors have trouble trimming their book or letting go of control, says Mertens. The magic that you do has to be at a high level. Put systems in place so you dont have to worry about the minutia.
He credits the CRM system that his firm adopted, which enabled him to increase the personal attention to high-net-worth clients because technology freed up other time spent on more mundane tasks. Mertens admits that it takes some getting used to, however once in place the technology will not only help free up time but give advisors an understanding as to how much time each client is costing the firm.
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