A new feature that we’ve brought to these pages tries to look at the advisor-client relationship from the client’s side. Our thinking is that hearing directly from clients about their experiences with advisors—good and bad—would be far more valuable to advisors than a typical “practice management” article written by sales coaches or consultants, full of platitudes and thin generalities that verge on the banal; we’ve certainly been guilty of publishing some of that, as have others.
The one in this issue is a good example. Lauryn Williams, an Olympic track and field athlete from 2004 to 2013, had sponsorships from Nike and Saucony, and was looking for advice with what to do with her money. Like many, she didn’t know what she didn’t know, and wasn’t even sure where to begin a conversation. She thought she needed a budget—her advisor sold her some investments. She moved to another advisor who offered to create a “financial plan” and automate her bill payments. The plan was a personal P&L statement. The investments remained the same as they were with the previous advisor. They met quarterly to review it; the advisor would assure her she was fine, brag about clients that spent more than she did, then take her out to lunch.
I’m sure the sales coach considered this a success story. Williams did not. As she learned more about what she wasn’t getting from these advisors, she moved on, found a better match, and eventually became an advisor herself.
To be clear, I’m sure there are far more “good” financial advisors earning their fees by providing valuable services for their clients than there are “bad” advisors taking advantage of client ignorance. But I’m also fairly sure both of the early advisors in Williams story would consider themselves “good” advisors.
Like everyone else, advisors often have blind spots when it comes to the role they play in their clients’ lives. Research that the CFA Institute has done, along with others, show some pretty wide variations between what advisors consider valuable and what their clients consider valuable. No surprise: Clients want advice, not just investment services. But dig deeper and there are other “expectation gaps” around accessibility, digital presence and product expertise.
The data is useful, but real world stories can drive home the point. We have more examples of these “client-side” takes on WealthManagement.com. Hopefully, you find them useful in either dispelling some misconceptions, or confirming things you already know and have implemented in your practice. I’m interested in how financial advisors themselves define success: Growth in AUM certainly, but are there other metrics that advisors use to ensure they are truly providing sustainable value to their clients? I’d be interested to hear what they are. Feel free to drop me a line at [email protected].