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3 Affluent 'Ah-ha’s' Financial Advisors Should Know

3 Affluent 'Ah-ha’s' Financial Advisors Should Know

Columbia:  “Does any one firm have an advantage when it comes to working with the affluent?” asked Donald after my keynote.  Before I could respond, he threw in another question, “What do financial advisors need to know about today’s affluent?”

Donald had just asked two questions, albeit different, that were actually closely related.  He wanted to know how to acquire and develop loyal affluent clients.  Narrowing the focus, I assured him this was a financial advisor issue, sure firms could provide tools, but at the end of the day it was up to the execution of each financial advisor.  I then shared 3 Affluent “Ah-ha’s”  sourced from our most recent affluent focus group to drive home my point.

Before going any further, let me outline the profile of these affluent investors in the focus group;


  • Minimum of $1 million of investable assets (range was $1 to $15 million)
  • Worked with one primary financial advisor


The following ah-ha’s should help take the mystery out of today’s affluent investor - they certainly put a smile on Donald’s face.


1. How do today’s affluent investors go about finding a financial advisor?  They talk.  It’s the power of good-old affluent word-of-mouth influence.  

“When you have recommendations from family members or friends that already have a trusted relationship with a particular individual; that means I’d likely also have a high regard for their services.”

“You inquire about the nature of their experience with their financial advisor.”

“I trust the opinions of my family, friends and colleagues.”

Word-of-mouth influence is the dominating force for all major financial decisions with today’s affluent – and yes, selecting a financial advisor is a major decision.   FYI  -- there’s a difference with gender (The Art of Selling to the Affluent; 2nd edition page 124); women talk about brands 13% more than men and their “word-of-mouth” has 8% more influence.


2. What’s the most important reason for deciding to conduct business with a financial advisor?

“It was the credibility of the person introducing me – the strength of the person referring.”

“The person who I know and trust was happy with their relationship.”

“The financial advisor gave me some good advice before I became a client.”

Nothing is more important than receiving a strong recommendation from a trusted source.  After you’ve been introduced to a prospect by an affluent client, what your client says about you behind your back is more powerful than anything you can do or say.  It’s important to keep in mind that the “trust factor” of today’s affluent investor regarding the financial services industry, in general, is less than 50 percent.

This is directly related to how today’s affluent first discovered their financial advisor – word-of mouth influence is the dominant factor, but now it’s become more specific.  Both your services and character have been discussed in detail.

Also, it’s important that you have a depth and breadth of knowledge and you can share – but only when asked, and then sparingly.  The idea is to be both helpful and knowledgeable without giving too much free advice.


3. What do the affluent think when a financial advisor offers a no obligation second opinion?

The response was essentially unanimous, all stated that they probably would.  However, the differentiator was the qualifier; a financial advisor they trust and respect.  That said, as the following comments suggest, today’s affluent look at a second opinion as standard fare for anything of serious consequence.  

“Why not?”

“It never hurts to get a second opinion.”

“I’m always interest in how others might be better.”

Yet not many financial advisors take full advantage of this attitude; even our elite financial advisors asked for only 7.3 second opinions last year.  The general population of financial advisors asked for less than three.  Ouch! 

As I explained all of this to Donald, his immediate takeaway was “It sounds simple, it’s all about reputation.  If you’re trusted and respected, word-of-mouth influence will be a growth engine.  When financial advisors are able to get clients to personally introduce them, they’ll   accelerate their growth.”

Donald got it.  Financial advisors need to understand the power of word-of-mouth influence,  the importance of crafting and managing their reputation, and mastering the art of the personal introduction.



Matt Oechsli is author of Building a Successful 21st Centure Financial Practice: Attracting, Servicing & Retaining Affluent Clients.

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