Clients don’t know your plans for the future until you tell them. But they can make assumptions (as can their children).
In this piece we drill down to specific actions which all advisory practices can (and should) make, with the intention always being to inform and enhance your client relationships.
It’s a question being posed by more and more clients to their adviser …what are your plans for the future? Do you intend (and, will you be able) to continue managing my financial plans or are you looking to retire or merge with another firm? It’s not an unreasonable question in any way and it’s one which deserves a clear answer.
By the very nature of financial planning, extremely strong bonds often develop between advisers and their clients. In fact, of the nine key service delivery areas covered in our CATScan Client Satisfaction Survey, clients rate the Business Relationship they have with their adviser above all else. Perhaps not a complete surprise when you consider that, according to our latest analysis, 42% of clients have been with their current adviser for at least 7 years.
The depth of relationship is truly a business asset, but it’s not without challenges. What happens if the relationship is threatened, or at least questioned, in some way? Especially if it’s the client who raises the concern – perhaps prompted by a broader industry issue such as the recent events with Shield for example.
Are you prepared for when a client asks you – what are your plans for the future? The subtext being – who will look after me, if/when you’re gone?
It’s been our experience that the most successful firms address this issue before it’s actually raised by their clients. They get ahead of this curve ball by proactively presenting their future plans. While there’s no need for specific detail, by outlining your longer-term commitment and direction (staying or going) you will be going a long way to addressing any concerns clients might have.
And if retirement or merger is in your plans, by addressing it early on, you’ll not only be paying your clients the respect they deserve by sharing your plans with them, you’ll be able to guide the narrative for the proposed transition.
As to the ‘how’, the most obvious approach is to advise your clients individually and in-person (say, during their review meeting). And if this isn’t practical for some clients, virtual or phone can certainly work.
While the communication medium may vary, the overriding objective won’t – to personally convey your retirement news to clients as well as key referral partners/centres of influence.
And for those practices who hold regular client events such as seminars, end of year updates, anniversary or Xmas celebrations, this is the ideal platform to announce/re-affirm your future plans – whether staying or going. A number of our clients have termed this their ‘State of the Nation’ update.
Finally, the tone of the communication (in whatever form it‘s delivered) is important – positive is good, being ever mindful of the terminology used ie. refer to your business, your practice, your firm and your team. Always “we” and never “I”.
For your consideration.
Footnote: Around one in four Australian advisory firms have a clearly articulated and documented business plan, while less than 5% have a comprehensive succession or transition plan.