Getting personal with your clients

In today’s environment, can a financial adviser effectively and appropriately handle the financial planning needs of 1,000 clients?

Whilst I think this may be achieved with the right support (staff and technology), I feel that the majority of advisers would find this difficult.

Advisers are often under immense pressure to continually increase their funds under management.

This creates a conflict between attempting to achieve new business targets and servicing your existing client base.

In changing economic and legislative conditions, are we, as advisers, providing each of our clients with the personalised advice/service they are paying for, or are we only providing ongoing advice ‘on demand’ when the more proactive client approaches us?

At my previous dealer group, I experienced my client base continually growing to the point where I struggled to service more than 800 clients.

I felt frustrated and angry at this pressure, and with no improvement in sight, it was the driving factor behind moving to a smaller dealer group, where I could develop a sustainable client base that could be provided with the appropriate ongoing advice to meet their needs.

Remembering the six steps of the financial planning process:

1. Collection and assessment of data;

2. Identification of the client’s goals and objectives;

3. Identification of financial problems;

4. Preparation of written alternatives/recommendations;

5. Implementation of the plan; and

6. Periodic revision and review of the plan.

As a young adviser, I feel that step six, ‘Periodic revision and review of the plan’, is the most important, but ask how many advisers/dealer groups are actually doing this across their entire client base?

Our industry is permanently under pressure to justify the fees and commissions we receive from our clients’ portfolios. In some cases I feel this is deserved. We have dealer groups that receive ongoing adviser service fees yet provide no ongoing advice to clients, and in some recent cases also then charge the client an additional flat-based fee when they ask for further advice.

There are many factors that will drive what is right for individual advisers/dealer groups.

Some of these factors could include technology available to us through software and fund managers, administrative support/paraplanning staff, the type of clients with whom you do business and factors including legislative change and market movements.

Having a clear client value proposition in place from the outset of moving dealer groups has enabled me to really understand the value I can offer my clients. It has also allowed the client to have clear expectations of what they will receive and the benefits obtained by dealing with me.

Clients appreciate the extra time spent, understanding the value their planner is actually delivering.

With technology and clear processes in place, many of these added benefits can be easily achieved.

Simple tasks can be automated such as generated letters at review time or even pre-populated forms to free the planner’s time. This has been a huge benefit in recent times.

There are always going to be situations where clients are not after an ongoing relationship with their adviser, but I think it comes down to what the client expects from their adviser and not promising something that cannot be delivered.

Striking a balance between keeping the client, your dealer group and yourself will, hopefully, create a win-win situation for all parties.

Kingsley Wright is a financial adviser with Fiducian Financial Services.