Are You Guilty of These 7 Advisor Faux Pas? Keep Your Clients Happy and Engaged

So, you think you’ve got the whole advisor-client relationship thing down, huh? Well, hold on to your spreadsheets because you might be in for a reality check. According to some recent research from Morningstar, there are a few things you might be doing that your clients absolutely loathe. Let’s dive into these seven deadly sins of financial advising and learn how to flip the script to keep your clients singing your praises.

1.  My advisor… did not provide a breakdown of fees.

Let’s start with a fundamental aspect of financial advising: transparency in fees. Picture this: you’re at a fancy restaurant eagerly awaiting your bill, but when it arrives, it’s just a random number with no explanation. Not cool, right? Well, that’s exactly how your clients feel when they don’t get a breakdown of fees. Your clients entrust you with their financial future, so it’s only fair they know how you’re compensated. Lay it all out for them – how do you as an advisor get paid? What happens if the client accepts your recommendation? Let them know exactly what they’re paying for and why. Additionally, set expectations for how often you’ll be monitoring their investments and meeting with them. Transparency breeds trust, and trust is the cornerstone of a strong advisor-client relationship.

2.  My advisor… took over a week to get tasks done.

Tick-tock, tick-tock – time is money, and nobody likes waiting around for ages. Be the superhero of efficiency! If a task can be done today, don’t wait until next month’s budget meeting. Your clients will appreciate your lightning-fast response time. Prompt action not only instills confidence but also shows your clients that their financial goals are a top priority. Whether it’s processing paperwork or researching investment options, show your clients that you’re on the ball and ready to tackle any challenge with gusto.

3.  My advisor… used financial jargon that I didn’t understand.

Ah, the dreaded jargon jungle. You might as well be speaking Klingon to your clients if they can’t decipher your financial lingo. Keep it simple, Sherlock! Use plain language that respects your clients’ intelligence while acknowledging that they might not be finance experts. Instead of throwing around terms that sound like a foreign language, Morningstar suggests explaining concepts as if you’re talking to someone highly respected in a field other than finance. Break down complex terms into understandable chunks, avoiding unnecessary complexity. Trust us; your clients will appreciate the clarity and feel more empowered to make informed decisions.

4.  My advisor… recommended investments without considering my personal preferences or values.

Hello? Is anybody home? Your clients are not just numbers on a spreadsheet – they’re living, breathing humans with dreams, goals, and maybe a secret obsession with collecting vintage lunch boxes. Take the time to get to know their quirks and values before throwing investment ideas at them. For instance, if a client is passionate about environmental sustainability, recommending investments in fossil fuels might not sit well with them. Instead, consider options aligned with their values, like socially responsible mutual funds or green bonds. Show them that you’re not just about the numbers, you’re about making their money work for what matters to them.

5.  My advisor… suggested investment options without going into the details.

Don’t be a tease, now! Your clients want the full scoop, not just the headlines. Dive into the nitty-gritty details of those investment options. Show them you’ve done your homework, and they’ll be more likely to trust your recommendations. For example, if you’re suggesting a particular mutual fund, explain its historical performance, risk profile, and fees. Break it down in a way that’s easy to understand, so your clients can make informed decisions about their money.

6.  My advisor… asked me to complete long, complex forms.

Cue the collective groan from clients everywhere. Nobody has time for endless paperwork, especially when it requires a PhD in deciphering legal mumbo-jumbo. Simplify, simplify, simplify! Streamline those forms into bite-sized nuggets, and your clients will thank you with a sigh of relief. Consider using online tools or digital platforms to make the process quick and painless. The easier it is for your clients to navigate the paperwork, the happier they’ll be – and the more likely they’ll be to stick around.

7.  My advisor… didn’t provide holistic advice.

Last but not least, the cardinal sin of financial advising – tunnel vision. Your client’s financial well-being is not a one-trick pony; it’s multi-faceted. Don’t just focus on one aspect and call it a day. Take a step back, look at the bigger picture, and provide advice that covers all the bases. Whether it’s retirement planning, tax optimization, or estate planning, show your clients that you’re their go-to person for all things finance. By offering comprehensive guidance, you’ll become indispensable to their financial success.

So, there you have it – the seven deadly sins of financial advising. But fear not! Armed with this newfound knowledge, you have the power to become the superhero your clients deserve. Be transparent, be efficient, and for the love of compound interest, ditch the jargon. Your clients will thank you, and your bottom line will too.

Ready to get started? At Beyond AUM, we specialize in helping financial advisors like you sidestep the pitfalls that can damage client relationships. Our team of experts knows how to communicate with your clients effectively, ensuring transparency, efficiency, and alignment with their goals and values. Whether you need help with client communications, website design, or content strategy, we’ve got you covered. Reach out today!