A Simple, 3-Part Framework for Busy Advisors to Improve Client Communications

Oct 17, 2022 | Guides

Relationships are the foundation of a successful financial advisory practice. But many wealth managers struggle to provide the level of attention that clients want and expect.

One of the challenges is that advisors aren’t always clear about their clients’ expectations. A recent study from Morningstar found that investors are often disappointed in their wealth managers for reasons outside of the individual advisor’s control — such as the ability to outperform the market, as an example.

Meanwhile, millennials and Gen Z are becoming a growing force as investors, while the average financial advisor is 55 years old, according to a J.D. Power Study. Because of this demographic gap, experienced advisors may be struggling to communicate their wisdom with digital natives who expect instantaneous, personalized responses.

With limited hours in the day, getting ahead of these communication challenges means working smarter rather than harder. Here are a few simple ways to maximize your relationship-building impact with clients, in an authentic, relatable way.

1. Host annual planning meetings

When was the last time you spent time with your client 1:1 to revisit their goals and discuss their overall progress as investors? Annual planning meetings can help ensure that you and your clients are on the same page — and that you are making the right decisions on their behalf. 

You can host these meetings via Zoom or in-person. The key is to dedicate space for open, face-to-face conversation. An advisor, your goal is to listen, take notes, and read between the lines for what your clients need. 

This meeting is not an opportunity to provide advice or demonstrate your skills. It’s about demonstrating that you care and understand. You may find yourself speaking very little during these conversations and encouraging your clients to steer the discussion.

“Help the client come to conclusions rather than telling them everything,” explains Bernard Ferrari, author of Power Listening and the former dean of Johns Hopkins University’s Carey Business School in an interview with RIA Intel. “Lead them to the answer like an educator.”

That means helping your clients, especially those who might be in a younger generational cohort, arrive at their own conclusions rather than telling them what to do.

Following the annual planning meeting, it’s a good idea to touch base with your clients once a quarter. You can offer the option of a 15 minute conversation, survey, or discussion over email.

2. Know your clients’ investing curiosities — in addition to priorities

Your annual planning meeting is a good time to understand what trends your investors are tracking, even if these topics are outside the scope of a portfolio’s overall performance. A theme that may be a curiosity now could become a priority down the line.

For instance, 75% of wealthy millennials consider environmental, social, and governance (ESG) to be an important factor in investment decisions, explains an article for Bain and Company.

“Bain & Company projects that ESG-related assets will compose about 46% of all assets under management by 2030, up from 33% today.”

As an advisor, it’s a good idea to simply ask your clients about their interests in topics such as ESG. With this information, you can send curated educational resources to clients. Let’s say that your clients are interested in ESG. Why not share news about relevant funds, trends, or investment opportunities proactively?

3. Share market updates proactively

Especially in today’s confusing market environment, clients may be expecting proactive outreach and communications. They may be waiting to hear from you — to follow direction — given the level of insight that you possess.

The fact is, nobody can predict the future performance of an investment. What advisors can do; however, is to provide guidance and manage expectations. That means taking the following steps:

  • Sharing trends about the market that may be relevant to your clients’ portfolios
  • Communicating updates pertaining to legislation in a timely manner
  • Preparing and sending over reporting before your clients have a chance to ask for it
  • Bringing issues to your clients’ attention before they have a chance to notice potential problems
  • Demonstrating an awareness of the overall economy
  • Clearly articulating investment strategies and methodologies, to ensure that clients aren’t surprised by results

A wealth management solution can help facilitate document sharing related to risk, performance reporting, probability of success scores, and other important information. The key is to ensure that your clients have access to the same data that you do, in addition to transparency into your decision making, in real-time.

Final thoughts

Software is a powerful piece of a financial advisor’s relationship-building equation with clients. The key is to supply access to data, in addition to offering transparency into your judgment calls.

Remember that your customers are placing a high-degree of trust in your expertise. You don’t need to be present or top of mind, all the time — relationship-building doesn’t require a heavy investment in hours in your day. The key is to make every interaction count.

If you found this resource valuable, we encourage you to please share it with fellow financial advisors in your network or in any communities in which you belong.

Learn more about CircleBlack

CircleBlack is an all in one management platform for the wealth management industry. You can think of it as an operational dashboard to better connect financial advisors and their clients around a shared perspective. The outcome is better collaboration and communication for relationship-focused advisors.

To learn how our software can help you build, manage, and grow your wealth management practice, get in touch.  

This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice.

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