Introduction: Build ongoing client relationships

Build a clear financial roadmap through long-term, open relationships



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Key takeaways:

  • Finding out what is important to your clients and giving them a more personalised service
  • Making sure your communications are timely, relevant and tailored to the client’s needs
  • Producing a roadmap for clients based on in-depth fact finding and soft skills that help them understand what it is they truly need without causing affront
BMO Adviser Edge Introduction Build ongoing client relationships

Advisers must truly understand their clients, going beyond the black and white facts of their finances, to be able to provide solutions tailored to their needs. Creating a lasting and open relationship between both parties can be crucially important to an adviser.

Being more than just another service provider to your clients should be your goal. Listen to them and identify what is important to their life plan, and what they want to achieve in the future. To form this picture, advisers need to ask the right questions, before producing a roadmap that can be effectively communicated to them. Soft skills are particularly important at this point, to help communicate a plan in ways that will resonate with different personality types and without causing affront.

The argument in favour of ongoing financial advice is clear. Individuals who adopt high-quality financial advice through a long-term relationship are more likely to have better financial outcomes, according to research from the International Longevity Centre. But how do we make the clients truly buy into this relationship?

Financial advice needs to go beyond simple finances. A reinforced relationship can support a client throughout their life and help them respond to changes in circumstances. Advisers, therefore, should invest greater time and effort into their ‘soft skills’. Developing a greater understanding of clients is a crucial part of this.

Prioritise your clients’ best interest

Trust and customer satisfaction are essential for financial advisers. For an industry that relies – to a large extent – on word of mouth for referrals, clients need to be more than satisfied. Clients need to be enthused. And that’s because you are dealing with something very sensitive – people’s money.

Financial advice is all about understanding investors’ motives. What are your client’s goals and why do they want to meet those goals? What makes them happy? How do they spend their time? If you understand what they are trying to achieve, you can offer solutions that get them there sooner, or even improve on what they’re trying to achieve.

Capturing soft data like this delivers essential detail that builds a bigger picture. If someone doesn’t just explain to you that they want 50% of their salary in retirement, but why they want that much and what they want to do with it, you can build a better relationship and offer a more comprehensive financial plan.

Having a closer relationship with your clients can also demonstrate that the advice given is appropriate. For example, a client may want to buy health insurance while saying they are in good health. Further investigation might reveal there is a family history of illness which has motivated their interest. This can then influence their wider financial plan.

Conversations around these topics can be difficult to have. However, advisers prepared with the right questions and equipped with a better insight into the lives of their clients will be better placed to provide support. If you don’t have these conversations, you’re less likely to build support.

You also need to be able to challenge and discuss the answers clients provide. Why do they feel a certain way? How do they think a solution might resolve their problems? The adviser is there as the expert and clients need confidence that they are being guided, not placated.

Be on the ball when things change

Investors want to know that advisers are sensitive to their changing circumstances and any outside factors that may impact them. Outside factors could include changes to tax laws that may necessitate amendments to the portfolio. There may also be legislation that makes certain investments less attractive or macroeconomic events that require a change in strategy.

Other issues may be personal, as marriage, divorce, birth and death can all affect financial plans. Products and services should be adapted to suit a client’s changing circumstances. Recognising vulnerability early on is an important part of this, such as early onset dementia or the early signs of a marriage breakdown. And issues that require more gradual changes, such as age and health, can also have an impact. You need to listen to your clients at least as much as you talk to them.

Knowing your clients is vital, because client relationships should last for years – clients need to trust their adviser to get them to where they need to be. And sometimes that means being proactive. We can’t simply fact-find, propose the right products and let the markets dictate any changes. Personal circumstances and long-term goals change. When they do, advisers need to be there for their clients. Let them know that you have solutions for different issues they may face. When it comes to financial products, always make sure you clearly communicate new ideas to them.

Communicate, communicate, communicate

Communication is about building trust, demonstrating the benefits of your guidance and showing that your approach will always be tailored to your clients’ needs. Regular communication can make clients feel more at ease with their adviser and their financial plan – and more likely to sing your praises to others.

Clients don’t just want to hear from you, they want personalised communications. They want to hear from their adviser on information that is relevant to them and their portfolios. These communications don’t have to be about products, they could just as easily be educational. Personalised communications also mean considering demographics. For example, is a communication strategy suitable for a younger generation of clients? Can their interests be catered for, including a greater focus on issues they would attach more importance to?

Keeping up to date with clients in terms of market updates and personalised recommendations can have tangible benefits. According to research conducted by Y Charts in 2019, 63% of clients stated that more frequent and personalised contact would give them more confidence in their financial plan. This was particularly true of those under 50, where four in five of whom stated that better communication would provide greater confidence. Good communications are vital to retaining clients.

Clients with faith in the financial plans their advisers have provided are also more likely to provide referrals, which are vital for growth. Nine out of 10 respondents would consider the style and frequency of communications when referring their adviser to friends and family.

Communication, like good onboarding, is also a way of getting to know your client. It’s another way in which we build authentic relationships.

Trust and satisfaction are essential

Advisers need referrals and that means satisfied customers who shout their names from the rooftops. Go above and beyond and you will soon reap the benefits.

Understanding clients through regular communication is essential. This is especially true in a world where digital solutions and shifting demographics have led to one-third of clients switching providers in the three years to 2019. It’s also worth adding that older generations are 29% less likely to switch than millennials, so we need to find ways to engage younger investors. Those investors with a low level of investment knowledge are also more likely to switch. If they are kept up to date and informed, they may be less likely to look elsewhere.

By keeping up to date with your clients – both in terms of personal circumstances and changes in financial markets – you acknowledge that financial circumstances are complex and they evolve. And, crucially, you demonstrate that you can help clients manage these changes.

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