Take it from me. As I’ve explained in other blogs, I grew a business from zero to over $100 million AUM and operated at an 80% gross profit margin or better (40% after IAR comp) the entire time.

Your job is not “chief technology officer.” Is it?

It does not say CTO after your name in your email signature. Does it?

The nameplate on your desk does not say IT Guy or IT Gal. Does it?

No.

You are the CEO, my friend. You are chairman of the board, your client’s trusted advisor, and captain of your destiny! You want somebody else unraveling the 800 pound ball of string that is FINTECH today.

1980s hit: Hard to Say I’m Sorry

With higher DOL oversight, there’s next to no room for any kind of compliance mishap anymore.

The lesson about how to run your practice:

Do you really want to manage a full investment platform yourself and have to worry about meeting every single regulatory requirement? Doing this right is a job itself. You’ll never get to what’s important – actually serving your clients – if you’re behind a desk buried with this stuff all the time.

Look at a full-service TAMP that will allow you to deliver higher level of service with controls and automation that reduce liability such as:

• Trade blotters and administration
• Form ADV updates
• Cybersecurity preparedness
• Compliance testing
• Compliance system checks
• Books and records requirements
• Training and education

1980s hit: Islands in the Stream

Do you really know your business counterparties?

According to a 2019 study by Michael Kitces, advisors spend only about 20% of their time on clients and the rest on running the business of the business.

How can you really get to know your clients this way?

What does that mean for those advisors who are willing to up their percentage from 20%? It means you’ll be the stand out.

The lesson about how to run your practice

Financial advisors should dedicate time to deepening their relationships with clients and they will be set apart (“no one in between” to quote the song). Not only will this lead more of your existing clients’ assets to your door, it’ll bring you more referrals as well.

1980s hit: Another One Bites the Dust

Client retention is only getting tougher with clients increasingly using the internet to find advisors. Financial advice is more of an easy-come-easy-go type of business than ever before.

The lesson about how to run your practice

Did you know that millennials fire their advisors four times more often than other generations?

1980s hit: Karma Chameleon

As wealth transfers down from one generation to the next, you’ve got to know and understand more facets of your clients’ personalities and interfamily dynamics.

The lesson about how to run your practice

One of the most important pieces of information for a growing firm is the CRM system. Do you have relationships with the right vendors? What kind of pricing can you get going at it alone vs. with a platform that has great relationships with the big, well known CRM brands?

It may cost you to join a platform, but there may be certain economic advantages that will soften the cost. For more examples, please refer here.

1980s hit: Out of Touch

It’s not a 9-to-5 business of the phone and fax machine anymore. You’re expected to communicate with clients at any time, regardless of where you or they may be geographically.

The lesson about how to run your practice

Are you able to communicate with your clients through text messaging and social media?

Be a virtual advisor and serve your clients anywhere from any device. You’ve got to be digitally hooked up and supported by a platform that can allow you to respond quicker, and that tracks it all compliantly.

1980s hit: We Are the World

Financial advisor firms come in all shapes and sizes.

The lesson about how to run your practice

Are you really in control of your bottom line? Does your platform’s pricing model penalize you or reward you for growing your practice in the way that suits you and your clients best?

Find a platform that aligns its fees with the size and type of your practice. Just as the services you deliver aren’t one size fits all, neither should the platform you use be.

1980s hit: Invisible Touch

With more low-cost options than ever before, clients want more out of the services for which they are paying full price. Are you truly delivering this? Can you? Or, are you held back by technology that decreases your responsiveness?

The lesson about how to run your practice

You’ve got to find a way to carry it all off without looking like you are hectic and stressed. You need some kind of a behind the scenes (hence “invisible”) force at work.

Technology solutions matter. Is your platform really going to deliver all that your clients need?

Summary

Advisors who are ready to realize their full potential and improve deliverables to clients should build a practice model that will carry them to the next level. You have spent years helping your clients prepare for their future. Think about how to prepare for yours.

Jim Palumbo is a principal and chief development officer (CDO) at Dynamic Wealth Advisors. His motto is “only as we help others succeed do we succeed ourselves.” Dynamic is recognized as a premier provider of essential resources to professional wealth management practices.

Dynamic Advisor Solutions, LLC d/b/a Dynamic Wealth Advisors is an SEC-registered investment advisor. Investment advisory services are offered through Dynamic.

Read more articles by Jim Palumbo