Six Words that Open the Door to Accountant Referrals

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A list of Dan Richards’ previous articles appears at the end of this article.

Dan Richards

Put together a list of the things that frustrate advisors targeting high-end clients and roadblocks to referrals from accountants are sure to be close to the top. Successful advisors recognize the power of a recommendation from a HNW prospect’s most trusted advisor.  Many have invested lots of time and energy trying to build referral relationships with accountants, with little to show for their efforts.

My recent round table conversations with accountants have identified an approach that substantially increases the odds of success.

It all starts with looking at things from an accountant’s point of view.

I’ve highlighted a number of obstacles to getting referrals:

  1. Like everyone these days, accountants are inundated with emails, voice mails and pressing items on their “to do” lists – and referrals to financial advisors are seldom a high priority.
  2. Accountants are skeptical of anyone paid on commission – and talk as we will about “fee based” compensation, many accountants see any form of compensation except hourly billing as commissions by another name.
  3. Accountants have bills to pay like everyone else – and most approaches from advisors offer little prospect of meaningful additional revenue for their business. (Some of the sophisticated estate planning approaches used by high-end insurance oriented advisors are an exception).
  4. And perhaps the biggest roadblock: accountants’ paramount concern about the loss of client goodwill if they make a referral and the client ends up unhappy. This was the case before the recent market woes and is an even bigger concern right now.

One accountant put it this way: “If I introduce my best client to an advisor and the client ends up making money and is happy, that happiness rubs off on me so I’m better off.  If I introduce that client to an advisor where he ends up unhappy, that rubs off on me also – and could potentially cost me the client. Quite simply, the risk of losing the client isn’t worth the potential gain.”