A Financial Advisor’s Guide to Lasting Client Relationships

The longer you retain your client, the faster your consultancy will grow, and the happier your client will be. Here's a simple guide to how financial advisors can develop long lasting relationships with their clients.

Any finance professional knows that long term investments always pay off. The financial markets reflect overall economic growth and productivity in the long run, which tends to taper off the negative effects of short term volatilities and the transaction costs associated with active trading.

The same principle applies to client relationships. The longer you retain your client, the better for you and your consultancy and the happier your client will be.

A happy client is a long lasting client

Besides avoiding the negative consequences associated with high client turnover, like the added paperwork and required tax adjustments, long term client relationships give your financial consultancy business the following benefits:

Produces steady income: Having long term clients translates to a steady stream of income. You can plan better and more ably grow your business.

Builds a foundation of trust: A long term relationship with your client means that you have been tried, tested and proven true, thus engendering trust.

Markets your brand: A client that has learnt to trust your abilities is much more likely to refer you to friends and family, helping you land even more clients!

Lowers marketing costs: A steady income stream coupled with a built-in referral system founded on trust effectively lowers your marketing costs.

So how can you acquire these benefits for your consultancy?

Here are some steps you can take to ensure that you keep your clients happier, for longer:

Find the Right Client for your Business

Financial planners operate in a market with diverse clients, various professions, and a wide range of income levels, with many divergent financial goals. Consultants on the other hand, target certain niche markets and have differing levels of experience.

Chances are that adopting the wrong strategy may lead you to the wrong client, who probably won’t stay long.

Finding the right client starts with you. What is your target niche? Who are your clients? Which social media channels do they frequent? Finding answers to these questions will help you to better understand your client and employ the right tactics to secure a beneficial, long-term relationship.

Moreover, securing that perfect match entails asking relevant questions to your potential client. An advisor’s main goal is to help the client attain both short and long term financial goals. This means that the client has to be extensively consulted to determine their:

  • Income level
  • Expenditure patterns
  • Risk appetite
  • Financial objectives
  • Investment timelines

Every financial consultation can be done with the aid of a financial health questionnaire, which lists all current and future incomes and expenses, including estate plans and tax situations.

A properly filled questionnaire gives you a complete picture of your potential client and helps you apply your expertise in earnest.

Decide On The Terms and Expectations

Like any other relationship, both you and your client will come with expectations in hand. Discerning their needs is your first task as a financial professional, as it will help you give sound, valuable financial direction.

Once you determine their financial goals, clearly present your terms and conditions. These details should be put down on paper, and be kept by both parties. Aim for comprehensiveness when articulating your conditions to your client so that it will be your map and compass when it comes to future interactions with or on behalf of your client.

Your terms of service will guide your client interactions

When giving your terms, ensure that you maintain full disclosure, especially on matters of remuneration. Some advisors earn commissions from third parties, so while it isn't a crime to be an agent of an investment firm, for example, failing to disclose this relationship to your client could be considered unethical, and may lead to a termination of your services when your client catches on.  

Once both you and your client have come to an agreement and signed on to your terms and expectations, you’ll need to strive to keep your end of the bargain. These terms are not to be hurriedly read over, signed and shelved at the bottom of the pile.

Your terms of service as a financial advisor are the roadmap to a long and hopefully prosperous relationship with your client. Strictly abiding by your terms creates an atmosphere of predictability, and eventually trust; while deviations may result in lawsuits and lost revenue.

As you continue relating with your client, the nature of your professional relationship may change, requiring you to re-evaluate your terms.

In this eventuality, ensure that the communication lines remain open between you and your client, to speed up the process of amending your terms of service. Remember to maintain clarity and fidelity throughout your dealings.

Consistently Communicate

When people talk, listen completely. Most people never listen.” - Ernest Hemingway

Going beyond addressing any queries and concerns, a financial consultant should always ensure that the client gets updated information regarding their financial position. Healthy communication serves a variety of purposes, including:

Deeper Client Connection - Connecting with your clients helps you better understand their current situation, goals and desired outcomes. More often than not, life situations dictate an individual’s financial position. Engaging in communication that is as simple as small talk can prove invaluable in providing information that’ll help you serve your client better.

Ongoing Feedback Mechanism - Healthy client-consultant interactions enable you to solicit feedback from your client. You can gauge your performance as a service provider and highlight areas that need improvement. Moreover, the simple act of seeking feedback demonstrates sensitivity to your client’s needs, thereby encouraging trust and enhancing the longevity of your professional relationship.

Demonstrated Accountability - Communication helps keep the client aware of the goings-on in the financial world, especially with regards to how their investments are fairing (of which the financial advisor is usually in charge). A client with an accountable advisor handling his or her finances doesn’t have to worry about how their investment is doing, because they expect, and receive prompt information as soon as necessary.

For a financial consultant seeking a long term relationship with a client, poor communication is a no-no. The decision to take one’s financial life and hand it over to someone else is already a scary prospect. The consultant’s success, therefore, lies in their ability to constantly reassure their client that their money is in safe hands.

Keep Learning

“Live as if you were to die tomorrow. Learn as if you were to live forever.” – Mahatma Gandhi

The growth of your business is dependent on the growth of your clientele who in turn leverage your broadening expertise by learning from you. As a financial consultant, you must stay ahead of the curve by continually absorbing information relevant to you and your client. There are a plethora of avenues through which a financial planner can glean valuable information, including:

Seminars - Financial seminars offer a goldmine of valuable information to the consultant and are indicative of the current trends in the field. Attending such fora also exposes you to industry leaders and like minded colleagues, with whom you can network and follow up for advice, and even develop mutually beneficial partnerships with..

Books, journals and newsletters - The internet is an abyss of information, both accurate and flawed. An astute financial professional knows how to sift through the jargon to find valuable and relevant insights. Subscribing to finance journals and newsletters keeps you on your toes and ensures that your client gets the best advice you can give.

Current financial news - Watching and reading up on financial news is a great way to keep abreast of the current economic outlook. Imagine the embarrassment of having your client mention a hot topic from last week’s breaking news only to receive a blank stare from you because you don’t keep tabs on what’s going on in the world — and you’re supposed to be the widely-read expert in the field!

Remember that your client also needs to learn, just like you! Do you have a book that you think they’ll enjoy? Or maybe an informative video they might appreciate? Why don’t you give them a recommended reading list?

Learning for your client also involves explaining financial advice to them during consultations in a manner they can understand and absorb. Unlike a toddler that absorbs everything their parents say without question, your customer will likely require an explanation regarding the important decisions you make.

Presenting thorough financial breakdowns not only helps them understand financial issues more broadly,  it also creates an appreciation for the work and amount of thought you put into ensuring they attain their personal goals, which again translates into greater trust in you and the expertise you’ve garnered.

Show Appreciation, Take Feedback

Psychological studies on gratitude assert that a simple act of gratitude creates more social interaction, lessens stress and promotes a ‘we are in this together attitude’. Science wholeheartedly agrees with the business principle of appreciating your client.

Aside from making your client feel good, being gracious is an unfortunate rarity. You will stand out because not too many consultants take the trouble to appreciate their clients for the trust they put in them. Showing appreciation, is a simple yet thoughtful gesture that will leave a lasting impression on your client’s mind and add to the many reasons to keep you around for the long run.

Aside from making your client feel good, being gracious is an unfortunate rarity. You will stand out because not too many consultants take the trouble to appreciate their clients for the trust they put in them. Showing appreciation is a simple yet thoughtful gesture that will leave a lasting impression on your client’s mind and add to the many reasons to keep you around for the long run.

So send that ‘thank you’ email, better still, send a small gift on a work anniversary or during the holiday season and melt your client’s heart.

“A simple ‘thank you’ card can give you a favourable brand image.”

While you positively affirm your client, actively solicit for, and be ready to receive feedback (however negative). Ask your client if their expectations are being met so far and how they feel about working with you. For feedback to be constructive, it should be preceded by a foundation of open and free communication.

The reaction you solicit from your client is not only designed to help you improve the quality of your service, it also signals that you are in pursuit of a seamless, stress-free and most importantly, long-term client-consultant relationship.

Offer Quality Service

A business that focuses on offering quality to its clients always retains them in the long run. How committed are you to giving your customer the best service possible? While quality advice is non-negotiable, also consider improving the administration of everyday office processes which, though seemingly trivial, contribute to the overall customer experience.

The COVID pandemic has fast-tracked the migration of many businesses into online spaces, creating the need to have professionally managed yet virtual tasks. These tasks cannot be undertaken without leveraging essential online tools.

Online workers have to provide quality service remotely

One example of an essential tool for remote work is MeetFox. This online solution is especially useful to remote finance planners working over the internet. As a consultant you can effectively plan for online meetings through a handy scheduling tool. It connects with calendars you’re already familiar with, like Google Calendar.

MeetFox includes an in-built video calling feature so you can host your meetings with a simple link. You can also conveniently bill your clients and collect payments instantly. And, if you need to reference a prior meeting, you can opt to record all or some of your online meetings and share past meeting recordings with your clients.

Taking advantage of simple apps like MeetFox can help you round out your services and take on a more  customer-centric approach. Your client will get the best technical advice and enjoy the best quality service, whether virtual or in-person.

Ultimately, your ability to retain your client rests on how well you help them achieve their financial objectives, whether short term or long term. This factor, however, rests on other ‘sub-factors, which include, your area of specialization and level of expertise. The financial world is too broad and deep for you to claim to be a ‘general financial consultant’. While it may seem like a good strategy to secure more clients, such messaging works counterintuitively; leaving you with neither valuable clients nor a speciality.

Your first objective to secure your long term client is to specialize in a specific niche. From there, you should target potential clients who are a perfect fit for your business.

As you grow, develop your financial expertise through continuous learning. And, don’t forget to actively seek feedback from your customer. Feedback is only helpful when there exists a healthy rapport between yourselves.

Most importantly, learn to appreciate your client. Let them know how valuable they are to you and how grateful you are for the opportunity they offer you to serve them, and watch as they stay longer and transform into the longest term, most valuable (albeit pro bono) marketers and clients for your financial consultancy.

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