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Finding Hidden Revenue with Existing Clients

October 30, 2012

by Dan Richards

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

Dan Richards

Investor skepticism and an uncertain economy are challenging advisors to maintain revenue growth and practice profitability.

That’s why I was intrigued by an advisor who’s used a simple strategy to achieve substantial growth in assets from existing clients, even though she already managed most of their money.

Are you ready for the challenge of a lifetime?

The Kilimanjaro Climb for Amani

Last year, seven members of Canada’s financial community climbed Mount Kilimanjaro and experienced the challenge of a lifetime.

They did this to raise funds for Amani Children’s home in Tanzania; this four minute video describes their experience.

A follow up climb up Kilimanjaro will take place next August, for details and info on an upcoming information conference call, email .

Become the “only advisor” for clients

This advisor – let’s call her Jane – came into the business about 25 years ago as assistant to a successful advisor. After a few years she got promoted to associate and six years ago took over his clients when he retired. Today she manages just over $80 million for about 300 households, supported by an assistant of her own.

The advisor who hired her always had the goal of being the “only” financial advisor for his clients. Her mentor encouraged Jane to get her CFP with a view to developing financial plans for every client, in the process often uncovering assets that clients hadn’t previously shared. For clients with investments held elsewhere, Jane still offers to develop consolidated quarterly statements – all that the client has to do is fax or mail a copy of their other statements.

As a result of this focus on becoming their clients’ “only advisor,” when Jane took over she had a very high penetration of client assets; in fact a survey of clients commissioned by her firm ranked her in the top 5% of advisors based on “client share-of-wallet.”  

That’s the good news. The bad news is that this high share-of-wallet limits the opportunity for capturing additional assets from existing clients. Earlier this year, however, Jane found a way to get around that problem.

Looking deeper for opportunities

Each January, Jane schedules reviews with her top 20 clients to update financial plans and discuss any outstanding issues.  These meetings go into considerable detail and typically run from 90 minutes to two hours.

This year, she added a new item to the agenda: “Conversation re powers of attorney and will.” Largely due to her prompting, almost all clients have up-to-date wills and powers of attorney for property and personal care, generally appointing the same individual as executor for the will and with power of attorney for property.  In most cases this is a spouse, adult child or other family member, although in a few instances the person who assuming this responsibility is the client’s lawyer,  friend or business associate.