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Putting Clients' Cash to Work

December 26, 2012

by Dan Richards

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

Dan Richards

A central challenge advisors face are is clients who need mid- to high-single-digit returns to achieve their long-term goals, but who have an overweight position in cash.  A recent luncheon with a group of highly successful advisors highlighted this challenge and illuminated a way to overcome it.

Clients know that they’re earning next to nothing in money market funds and savings accounts; locking up funds in five-year CDs or government bonds doesn’t do much better. The issue is how to present alternatives in a fashion that motivates clients to act.

Ready for the adventure of a lifetime?

The Kilimanjaro Climb for Amani

Last year, seven advisors climbed Mount Kilimanjaro and experienced the adventure of a lifetime.

They did this to raise funds for Amani Children’s home in Tanzania; this four minute video  describes their experience. The next Kilimanjaro climb will take place next August, for details and info on an upcoming information call, email

The advisors around the table shared four approaches they’d tried with little or no success:

  • One advisor had sat down with clients to review their financial plans, in some cases updating them, to drive home how staying in cash is jeopardizing clients’ financial futures.
  • Another advisor showed clients charts and graphs demonstrating that stocks are reasonably valued by historical standards.                                                                                                                 
  • Still another had used material from a fund company demonstrating how quickly markets could move once they began to bounce back – and the risks of missing that move if in cash.
  • The last advisor had built an extensive case for owning a group of high-profile multinational consumer packaged goods and pharmaceutical stocks.   He focused on the yield available from a diversified basket of these companies, pointing out that their dividend payout is comparable to owning a bond yielding almost 5%.  He also emphasized the fact that most of these companies have not cut dividends in recent memory.