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Three New Year’s Resolutions for Independent Advisors

Ask yourself how well you and your team managed relationships with clients over the past year, and whether or not you achieved your business goals.

It’s that time again. Financial advisors are busy reflecting on the year that’s nearly passed, and planning for the one ahead.

While it’s important to review client accounts and financial plans at year-end, advisors should also consider the performance and operation of their business during 2017, and how they can improve in the new year. Ask yourself how well you and your team managed relationships with clients over the past year, and whether or not you achieved your business goals.

What aspects of running your business can be done more effectively and efficiently next year? How can you turn more prospects into clients? What can you do to help your support staff work faster and smarter? These are all questions that could provide answers for how to position your practice to grow and serve clients better in 2018.

Below are three New Year’s resolutions that may help advisors strengthen their practices and client relationships:

Prepare for a Possible Market Correction: We are currently experiencing one of the longest bull markets on record, and as every veteran market-watcher knows, what goes up must eventually come down. With the Dow Jones Industrial Average, NASDAQ, and S&P 500 Index continuing to set and break new highs for an unprecedented amount of time without a market correction, many believe the market could undergo a reset next year. If the market transitions from bull to bear in 2018, advisors need to be prepared.

In the event of a downturn, a lot of investors will get scared, and their trusted advisors are going to have to calm them and talk them out of harmful, emotion-based decisions. Before the present bull market ends, advisors should check that all client contact details are up-to-date, and every practice team member knows where and how to access them. Also, advisors should review each client’s preferred method of communication, and ensure this information is readily available for them and their staff. Advisors can also check that any technology solutions their practices rely on are equipped to handle the high amount of client communications and account/portfolio adjustments that accompany a downturn.

Besides making sure all direct lines of communication are fully functioning, advisors can take steps to educate clients about the possibility of a correction. If advisors proactively reach out to clients now to explain what may happen in the event of a correction, and how they can help clients successfully navigate changing market conditions, they could prevent clients from panicking during a downturn.  

Make More Productive Use of Face-Time with Clients: The demand for practice management solutions that create operational efficiencies is driven by advisors’ desire to spend more time working with clients—and helping them reach their goals. However, the actual amount of time advisors have for face-to-face meetings with clients is usually at a premium.

Aside from advisors’ busy schedules, most clients don’t want to spend a lot of time meeting with an advisor. As part of our industry survey, we asked mass-affluent and high-net-worth investors who work with advisors, “If your advisor could improve one thing, what would it be?” Only 13 percent of them said they wanted their advisors to hold longer or more frequent meetings.

Advisors have an opportunity to make the limited face-time they have with clients as productive as possible. Aside from the typical event inquiries—trying to uncover valuable information about their families, jobs and major life events—advisors can use face-to-face meetings to help investors understand the full extent of the service they offer. For example, many advisors utilize software solutions to enable clients to monitor their investments on their own time, but some investors may not recognize the value there. A gentle reminder and highlights of the value being provided to them can help make face-to-face meetings more meaningful for both advisors and clients.

Advisors can also play the role of “translator” for their clients during in-person meetings. Investors today experience a barrage of breaking news on a daily basis. Hearing and reading about market fluctuations, volatile domestic politics, geopolitical uncertainty, alternative investments, cryptocurrencies and more each day can easily overwhelm investors. They want to know what everything they hear and read means for them and their investments. By proactively sitting down with investors to discuss, point by point, how all the big news stories of the day affect their financial picture today and in the future, advisors can help their clients appreciate the expertise and value they bring to the table. 

Take Stock of Your Business: The end of the year is the ideal time for advisors to review what drives their business, and where they can reduce costs and increase profitability. Evaluating business metrics such as cost per client and the ratio of referrals to new clients can help you understand whether you and your support staff are using your time in ways that are in your business’s best interest. Are there certain back-office processes that consume too much of your time, and take resources away from servicing, onboarding or prospecting clients? After analyzing time management across your practice during the past year, are you on track to achieve your long-term business and growth goals? If not, what changes need to be made? An honest assessment of your business is crucial for identifying opportunities to optimize, streamline and grow your practice in 2018. 

Regardless of the size of an advisor’s client base or assets under management, there are always areas where they can improve. Take the time between now and New Year’s Day to think about how you can make your business more efficient and serve your clients better in the coming year.

David Lyon is CEO and founder of Oranj, a Chicago-based provider of digital wealth management solutions for financial advisors.

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