If advisers want to consolidate more client assets, they will generally be more successful if they avoid any hint of a hard-sell approach.
Clients themselves are generally receptive to consolidating their assets, according to a recent Ernst & Young survey.
Although 73% of wealth management clients have relationships with multiple wealth managers, 57% would consolidate their assets into fewer firms “under the right circumstances,” E&Y found.
Advisers who demonstrate that they care about their clients and their interests are far more likely to win over a greater share of assets.
“I believe that many clients want to consolidate,” says CFP Brittney Castro. “They just don’t know where to begin.”
The starting point is to develop a trusted relationship with an emphasis on a plan that emphasizes client needs, advisers say.
Castro, founder and chief executive of Financially Wise Women in Los Angeles, says that she doesn’t chase returns or assets.
“I don’t compete at all on that level,” she says.
“I say it’s easier if you consolidate,” Castro says. “I know your plans, I know your goals, but a majority of clients will just consolidate because they see the value in doing it.”
The emphasis should be on the planning relationship, Castro says.
“I don’t focus on that I’m going to do a better job managing money or that I’m going to get you more returns. That’s not the conversation I have,” she says.
“I’m more focused on the value of having me directly,” Castro says.
In other words, the adviser who “owns the plan will own the assets,” says Diane Morgan, a Raymond James adviser in Dayton, Ohio.
“Clients will eventually find out that we waste a whole bunch of time trying to update all the outside assets into the plan, whereas if they just had the assets here, everything would be automatic, clean and done,” she says. “It’s just so much easier to have the person who owns the plan handle the investments, also because the accountability is there.”
Still, for a variety of reasons, many clients will continue to have multiple advisers. But for the adviser focusing on an overall plan and a trusted relationship, that shouldn’t be a problem.
“We always say that we’re not there to disrupt any perfectly good relationships,” says CFP Kay Lynn Mayhue. “We play very nice in the sandbox with other advisors.”
Mayhue, president of Botsford Financial Group, with offices in Atlanta and Dallas, says that her firm’s clients are grateful for that approach if they have longstanding relationships with other advisers.
“By not going for everything, a lot of times we actually end up with more than what we made recommendations for, because clients appreciate the fact that we are respectful of relationships they have,” she says.
This story is part of a 30-30 series on ways to upgrade your practice.
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