Welcome back to the 119th episode of Financial Advisor Success Podcast!
My guest on today’s podcast is Kenneth Robinson. Ken is the founder of Practical Financial Planning, an independent registered investment advisor in the Cleveland area with two advisors who work with 55 clients on an ongoing annual retainer fee that varies from $5,000 to $25,000 a year.
What’s unique about Ken, though, is his decision to focus on a niche of working with Ohio public sector employees, having been a public sector professional himself before career changing into financial planning 20 years ago, and the way he’s been able to make his practice so efficient by developing a specialized knowledge of Ohio public sector employee issues, from the state of fundedness of the Ohio Public Employees Retirement System and its pension plan, to coordinating Ohio public sector retirement planning for those who are also eligible for Federal Employees Retirement System benefits from a spouse, as well as coordinating Ohio public sector employee pensions with the Social Security Windfall Elimination Provision and Government Pension Offset rules.
In this episode, we talk in-depth about how Ken formed his niche in working with Ohio public sector employees as a career changer from the public sector himself, why he chose to focus on a niche not only because he felt he’d be more credible with them, but also because it increased his own confidence that he could add enough value to justify his fees in the early years, the way he got started in his niche by going back to some of his former colleagues to form what he called a Founders Club, where he asked for their feedback on his new advisory business venture, and then invited them to become clients for a first-year discount.
The way he developed a specialized website that acknowledges right away his niche with Ohio public sector employees so that at least anyone who did arrive on his website would immediately know about his specialized expertise, and the way he adopted his financial planning process over time, from simply doing a full comprehensive financial plan for every client up front, to instead always focusing the planning process on whatever the one most-pressing issue was for the client first and only then circling back to cover the rest of the modules of financial planning.
We also talk about the annual retainer fee structure that Ken uses, adopted from the Alliance of Comprehensive Planners and based on a combination of the client’s investible net worth, income and complexity, and why and how Ken decided to modify and even raise his retainer fees over time, including for his existing clients who started with him early when the fees were lower, and the way that Ken explains his retainer fees to clients to justify his value proposition by focusing on how financial planning is an ongoing process and not just the up-front plan alone.
And be certain to listen to the end, where Ken talks about some of the marketing challenges and mistakes he’s made over the years. What he’s learned along the way, and how working with a coach has helped him to stay grounded through the inevitable ups and downs of running an advisory firm.