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The Three-Step Formula for Business Fearlessness

In the financial services industry, advisers are surrounded by clients’ fears—fear of the market going down, fear of the economy not recovering and/or fear of making the right investment decisions, just to name a few. For some advisers, handling clients’ fears can feel like a daunting task while for others it’s all in a day’s work. For the latter, the formula for managing fear is increasing knowledge.

If this has happened to you, take comfort in knowing that your clients hired you because they like you, trust you and believe that you have their best interests at heart. Prove your clients right by believing in yourself, in your integrity, your honesty and your commitment to helping them. When you focus on things that you can control, you harness the power of belief.

Ralph Waldo Emerson said it best when he said, “Knowledge is the antidote to fear.”

So how can you face your fears, increase your knowledge and be the adviser that your clients want you to be?

Let’s take a look at a step-by-step approach for building up your “business fearlessness.”

Step 1: Acknowledge Your Current Business Concerns

The first step is to get completely honest with yourself by asking, “What am I most concerned about in this business?” Sit with the question for as long as it takes until you find a truthful answer. Next, ask, “What do I need to know in order to overcome this concern?” and “Who has the information that can help me?”

Take Michael S., a veteran financial adviser with five years of experience who had noticed he was holding himself back from working with higher net-worth clients. After he asked himself these types of questions he realized that he didn’t feel qualified to help them because he hadn’t done enough research on what product and services this niche demographic would be interested in much less had done some inquiry to confirm what issues/concerns they might have. Thus, he had spent five years building a business of hundreds of clients with very little in investable assets.

Step 2: Become the Expert

The next step is to do the research and make some calls to find out who could assist you in your desire to work with a new demographic. I have found that the best way to become an expert is to find a mentor in the office who has accomplished what you would like to accomplish.

I recommended to Michael that he make a list of the most successful advisers that he knew (in his office or elsewhere) that work with high net-worth clients. Then, approach the one person who he felt closest to and ask if he could take that person to lunch or for coffee to understand more about how he/she had grown their business. Take notes about their process and research all the types of products and services they mention. Michael did this and was ready for the next step. 

Step 3: Be the Message

The final step is get your message heard! It’s one thing to know what to do but it’s another to be doing it. That’s why you need to take deliberate action steps.

Once Michael got direction from a mentor in the office, we mapped out what to say to potential clients, how to frame it, how to handle objections, what the first appointment process as well as the second appointment process. We did all of this before he ever picked up the phone to make his first prospecting call. As a result of his due diligence and efforts, within weeks he had built a huge pipeline of qualified prospects and now has a thriving practice.

Why Being a Wealth of Knowledge Works

The foundation for making any sound recommendation is based in the amount of information or knowledge that you have for your clients. The more informed you are, the more confident you will be when sharing those recommendations. Clients need, want and deserve a well-informed financial adviser. So the next time you find yourself with fearful clients or faced with fears yourself, take the time to query the reasons for your decisions, support them with facts then share this insight with your clients and watch their fears (and subsequently yours) subside.

If this blog resonates with you and you would like to have a free consultation with me to see if professional coaching is a fit for you, email Melissa Denham, director of client servicing for Advisor Solutions at melissa@advisersolutionsinc.com.

Dan Finley
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.

 


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How Do You Train Someone?

Planners used to consider training as something that could be done on the job. You would hire a new employee and hope that he or she picked up the responsibilities over time. If you were lucky, the departing employee would be around long enough to train his or her replacement.

Times have changed. Today, we can’t get by with such an informal approach. Roles and functions in your firm are more specific, varied and sophisticated than they used to be. You need to hire client service employees, marketers, receptionists, paraplanners and new planners. Training in such functions can’t be left to chance—for new planners in particular. These men and women will be looking for professional growth, and you may hope to develop one of them to serve as your successor.

Still, for most planners, the need for more formalized training is problematic. Most would agree that training doesn’t contribute to short-term revenue growth. In some cases, because planners have long delegated certain administrative tasks, they may not even remember how to do them (e.g., completing paperwork to follow up on a client meeting). And training new planners has become increasingly difficult. These days, you can’t rely on bringing on a new employee who was schooled by a wirehouse. Those training programs have disappeared.

So, How Do You Train Someone?

To be effective, training requires three key criteria:

  1. Determining the outcome to be accomplished. This means defining specific objectives for the learner.
  2. Developing the curriculum, so the participant can understand and experience the content that needs to be learned.
  3. Measuring the individual’s performance to confirm that learning has actually occurred.

It is important to do all three of these well. Sometimes, we rush into training without considering what is most important to learn. Teaching how to resolve a once-a-year problem gets as much attention as the everyday situations. Sometimes, it’s hard to create the learning experience we’re looking for. And we complicate things by following several different processes for completing the same task because we lack standardized procedures within the firm. Finally, few firms test or evaluate learning.

As organizations continue to grow—particularly as we see more mergers and acquisitions—the need for formal training will increase. We will especially see it in organizations that hire inexperienced planners whom they intend to develop. In fact, that’s just one more reason why the large firms will get larger.

If you are a solo planner, you can hire someone and have him or her follow you for a year to learn the ropes. In the future, a large firm will likely hire a group of new planners to develop at the same time. Learning and curricula will need to be established and monitored. Being a planner who understands training will be a good start, but it won’t guarantee that the planner will be a good trainer.

The bottom line? Prepare to invest in training.

Joni Youngwirth_2014 for web

Joni Youngwirth is managing principal of practice management at Commonwealth Financial Network in Waltham, Mass.


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3 Steps to Find Your Business Bearings and Go Beyond

It is not uncommon for most financial planners to not know where their business is heading at some point in their career. You be one of those planners just going through the motions of the day-by-day without any clarity about whether what you’re doing is helping your business reach its next level. However, you don’t want to become complacent and run your business to just get by.

The following is a step-by-step process to help you find your business bearings and go beyond where you are to where you want to be.

Step 1: Determine Where You are Right Now. Take an honest look at where you are in your business; are you happy with the assets you have under management, the types of clients you engage with and/or the products and services you provide? Does your business leave you fulfilled? If not, do what my client did to get his business bearings.

John P., a 15-year veteran planner client, recently realized that his real challenge wasn’t the lack of gross production he was having with his business but the lack of passion he had for his business. Somewhere along the way he had lost his purpose and it was important to redefine his purpose and reignite his passion.

Step 2: Create Your Business Vision. Create a vision of what your “ideal” business would look like. Write it down. Map it out. When you know what you want your business to become, you have a much higher probability of attaining it.

After further discussion, John shared that what motivated him to get into the business in the first place was the joy he experienced the day he helped his father understand how to choose the right asset allocation for his 401(k). Unfortunately, his father had been contributing to his company plan for ten years and never realized that he was in the most conservative mutual fund option possible—a money market fund—and as a result, he never saw any substantial growth in his portfolio.

John’s purpose was to help those who needed and wanted his help not by just selling them products but by educating them about what they should buy and why it would help them have a comfortable retirement. It was the fulfillment he got from changing his clients’ lives that fueled his passion to build his business. This became the new center of his business vision, to help as many people as he could.

Step 3: Create Your Course. Determine the best possible route to ensure that your vision becomes a reality. In other words, you can have the plan but you need actionable tasks and accountability to stick with it.

Over the years John had lost sight of his purpose and focused on trading stocks for a chosen few in order to continue living the lifestyle he’d grown accustomed to. Once he understood that incorporating financial planning and bringing in those who specialized in risk management and estate planning would help his clients gain a bigger impact towards their retirement goals, we mapped out a plan to increase his financial planning knowledge and how best to let his clients know that he was expanding the scope of his services.

Why Going Beyond is Important

He ended up telling his father’s story to his clients and many of them were very open to his new level of service. As a result, he was able to indeed effect larger and more significant outcomes than he had ever thought possible because he found financial planning, insurance and estate planning solutions to challenges he (and his clients) didn’t know they even had.

Schedule a complimentary 30-minute coaching session me by emailing emailing Melissa Denham, director of client servicing.

 

Dan Finley
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.

 

 

 

 


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Lessons from Benjamin Graham

When I was growing up in 1997 in a South Carolina town (population 2,070ish, plus two stop lights), every year around this time my class would be asked to write essays on people we admire—people who have influenced us and helped shape our world.

The answers were generally our mothers or fathers, with an occasional Michael Jordon, Mia Hamm, Britney Spears or, for those who sat in the back of the class, Kurt Cobain, thrown in the mix (it was the 90s, after all).

It might be force of habit, but once the weather starts cooling off, I begin to think about people who have had an impact on my world. This year, beyond friends and family, I began to think about someone who has had a major impact on my—and probably everybody else’s—life as a financial professional.

Benjamin Graham. The one who is called the “Father of Value Investing” or, by me (being the financial geek that I was and continue to be) “the Michael Jordan of Investment.”

Graham, who was born in 1884 and died in 1976, documented his ideas and methods on investing in his books Security Analysis (published in 1934) and The Intelligent Investor (published in 1949), which has sometimes been called the “Bible of Value Investing” and is still considered to be one of the seminal texts on investing for the modern era.

Warren Buffett himself said that The Intelligent Investor changed his life. “If I hadn’t read that book in 1949, I’d have had a different future,” Buffett said in a Business Insider article. High praise, indeed.

His philosophy is so second-nature these days, it’s hard to believe it was once revolutionary. His concept was value investing, the principle that any investment should ultimately be worth more than what the investor paid for it.

The lessons I’ve learned from Graham are lessons I both practice and preach.

Look for investments thought to be undervalued. Simply put, buy $100 worth of assets for $50.

Understand the “margin of safety,”—the difference between the stock’s current market price and its intrinsic value.

Understand the health of the business you’re investing in—its earnings, dividends and assets.

Understand market volatility and profit from it. It’s not a question of whether the stock will fluctuate. It will. The trick is how you respond. Invest in the business, not just its current value. When you value invest, you will stop worrying about the market.

Understand what kind of investor you are: enterprising or defensive. Will you commit to the research, monitoring and attention to your portfolio or is your chief emphasis on the avoidance of serious mistakes or losses?

Over the years, market developments have borne out the wisdom of Graham’s basic principles. His core tenets of value investing remain relevant today. Here are some of my favorites. The pages noted refer to The Intelligent Investor, Fourth Edition.

  • “Experience teaches that the time to buy stocks is when their price is unduly depressed by temporary adversity. In other words, they should be bought on a bargain basis or not at all.” (p. 98)
  • “Have the courage of your knowledge and experience. If you have formed a conclusion from the facts and if you know your judgment is sound, act on it—even though others may hesitate or differ.” (p. 524)
  • “This may be set down as a fundamental law of the stock market – that the enterprising investor concentrate on the larger companies that are going through a period of unpopularity.” (p. 63)
  • “Any approach to moneymaking in the stock market which can be easily described and followed by a lot of people is by its terms too simple and too easy to last.” (p. 195)
  • “Much bad advice is given free.” (p. 270)
  • “To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks.” (p. 524)
Harper Tucker
Harper Tucker is chair of the Financial and Legal Innovation Practice and vice-president of Authority Marketing for ForbesBooks and Advantage Media Group.

 


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5 Steps to Run Your Business with Positive Intention

Years ago, when I was a rookie, I was running out to an appointment with a client I was hoping to close, when a colleague wished me good luck. My immediate response was, “Thanks, but he’ll probably have to think about it.” My peer replied, “You’re right—if you go into the meeting with that intention.”

On the ride to the appointment I thought about what my co-worker had said and realized that I needed to run my business by going into each phone call and every appointment with a vision of a successful outcome rather than with my existing, less enthusiastic mindset. I quickly changed my focus—which had been negative—and instead worked on how to handle any possible objections that might arise during the appointment.

The result was one of the smoothest presentations (and closes) I’d ever experienced. Afterward, I made the connection: the reason my meeting went so well wasn’t because my change in focus was attracting success but because I went into the appointment expecting success.

The following are the steps I’ve used in many situations, in business and life, to increase my probability of success. Apply these steps and watch how your business and life can transform for the better.

Step 1: Believe in the outcome you want. When I look back at the aforementioned story, I realize now (20 years later) that although I knew I wanted to close that prospect, I didn’t believe that I would. Knowing what outcome you want and believing in your ability to achieve that outcome can be two entirely different thought processes. That’s why it’s so important to address any doubts you have by asking yourself, “What is the evidence that this is true?” And, in my case the follow-up question was simply, “Have I ever closed a prospect before? If I’ve done it once I can do it a thousand times more.” By questioning a negative belief system you are in fact decreasing its validity and increasing your own belief in yourself.

 Step 2: Know where you are now. On the ride to that particular appointment I had a revelation that I needed to run my business with intention. Up to that point I’d actually run my business by winging it. Believe me, I’ve coached hundreds of financial advisers and insurance agents since 2004 and one thing I learned early on is that winging it doesn’t work. That is why you need to get crystal clear on where you are now and where you desire to be. In other words, what have you been doing that has been preventing you from reaching your full potential?

For me, it was taking the time to prepare recommendations while neglecting to prepare for the presentation and any objections.

Step 3: Decide what to do and do it. That appointment was a turning point in my career because I realized that people don’t want to be corrected, they want to be connected. In other words, people don’t like to be told they have been doing something wrong with their investment strategy but they do what to know that you care about them and that you have their best interest at heart. In order to show them that, you need to ask questions to help prospects see that they have a challenge (if they do) and to realize that you have the solution.

So, I decided that I would focus on having a process for my presentations, ask better questions and lead them down a path to understand what value I could offer them.

Step 4: Prepare for possible pushbacks. In business, as well as life, we’re all faced with the possibility of pushbacks, those unforeseen obstacles that prevent us from reaching our desired results. In the case of presenting the prospect with recommendations, it’s highly likely that they will have objections. That’s why I decided to study a process (and actually develop a system) to handle any type of objection. When you prepare for possible pushback, you increase your likelihood of success because you are ready for the inevitable obstacles.

Step 5: Evaluate the process. A simple barometer for understanding how well your process is working is to observe the results you’re seeing (or not seeing). If you’re obtaining your desired results, than keep doing what you are doing, but if not it’s time to go back to the beginning and start over at step one.

Why Positive Intentions Work

The more often you go into any situation with an intentional, positive attitude and a plan, the more likely that it will become a habit. If you begin each interaction knowing what you want to happen, believe in the outcome and prepare your dialogue for inevitable objections and you will no doubt increase your probability for success. The reason why running your business with positive intentions works is because it’s the antithesis of “winging it” or leaving your business up to chance. Instead, expect success by preparing to succeed.

Schedule a complimentary 30-minute coaching session with me by emailing Melissa Denham, director of client servicing.

Dan Finley
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.


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Taking the Emergency Brake Off

Fear has an ugly way of stopping many advisers in their tracks. Fear of failure, fear of success (yes, even that) and fear of the unknown can leave you driving with the emergency brake on, slowing your pace and forcing you to work harder.

For advisers and agents who let fear affect how they manage their tasks, they shouldn’t focus so much on eliminating fear altogether but more on illuminating fear. Advisers and agents should try to understand how some of their beliefs or fears hold them and their advisory business from reaching a greater level. If this sounds like something you’re experiencing, you are not the first to experience this sometimes paralyzing crossroad. However, this post can teach you how to take that emergency brake off and put motivation and momentum back into your daily activities.

5 Steps to Overcoming Fear

The following are steps are for overcoming fear—both in your personal and professional lives. Apply each step when you are faced with a situation where you experience fear and/or anxiety and watch how quickly you can conquer it.

Step 1: Gain Emotional Awareness. Rick T. is a veteran financial adviser client of mine with 20 years of experience. He called late on a Friday afternoon concerned about a situation in which he’d emailed one client another client’s information by accident. The two clients have the same first name, so it was a simple mistake of typing the first name in the “to” box of his outgoing email. I asked him how he felt about what happened in order to give him a chance to identify and articulate his emotional awareness.

Step 2: Realize and Release. He was fearful and anxious because his compliance department was the one who notified him of the error. Unfortunately, it had occurred several other times this year so he was even more concerned about what this could mean for him. His mind was racing towards the worst-case scenario.

Putting into words how you feel and why is a great beginning. You need to let yourself recognize the fear and/or anxiety so you can work through it. It will release itself over time and you will feel better, but it’s important to sensibly talk through the situation with someone you trust until you find a stronger sense of calm.

Step 3: Get the Facts. It didn’t take Rick long to start thinking and getting worked up again about the situation. It’s common to keep experiencing the original emotion as most people’s mind tends to wander, ruminate and head back toward doubt, so I helped him refocus his thoughts by explaining the facts.

I’ve been in the financial services industry for 24 years—both as a financial adviser and a coach—and I’ve never, ever heard of anyone getting fired for sending out emails to the wrong client.

Step 4: Form a Plan and Take Action. Rick quickly asked me what he should do and we formed a plan and mapped out what he should say to his compliance department. When we hung up, he acted and made the call. By preparing for that call, we in fact refocused his energy toward something that he could control—which was trying to rectify the situation.

Step 5: Repeat the Process. It didn’t take long before Rick called me back, informing me that his compliance department was helpful and reminded him to slow down and double check when sending out any correspondence. I recommended to him that he repeat the process we used with this specific event for any situation that arose in the future that served up fear and anxiety for him.

Why Taking the Emergency Brake off Works

When Rick realized that he didn’t have to run from the fear, but instead embrace and face it, he felt empowered with hope (and equipped with a coping mechanism for bringing him to a calmer state). We all become reactive to some extent in these types of situations. That’s why taking the emergency brake off works, it takes you out of focusing on the immediate fear and allows you to focus on the process to hopefully remedy the outcome and move in the right direction.

If you are ready to take your business to the next level, schedule a complimentary 30-minute coaching session with me by emailing Melissa Denham, director of client servicing.

Dan Finley
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.

 


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These Tips Can Help Advisers Attract—and Keep—High Net Worth Clients

By Robert Powell, MarketWatch.com

For many advisers, high net worth individuals or households — those with more than $1 million in investible assets — are a kind of Holy Grail.

The reasons are clear. HWNIs, which represent just 0.7 percent of the world’s adult population but own 45.2 percent of the wealth, are good for business. They’re highly profitable and loyal, according to Rebecca Li-Huang, a wealth adviser at HSBC, who wrote a chapter in the June 2017 book Financial Behavior: Players, Services, Products, and Markets.

Consider: An adviser can earn one-half of 1 percent of assets under management on a $10 million account, say $50,000 a year. By contrast, the very same adviser would earn only $1,000 a year on a $100,000 account. For financial advisers, the attraction should be obvious.

But there’s more to the story, and advisers should get to know the psychology of HNWIs before taking them on as clients. Just like regular folks, Li-Huang wrote, they are prone to behavioral biases and judgment errors, not perfectly rational, utility-maximizing, unemotional homo economicus.

In short, wrote Li-Huang, they are humans. And in the U.S., according to Li-Huang, they often share a particular way of thinking about what they want from their money that financial advisers should consider when trying to serve them.

American HNWIs like to direct their investment according to their personal beliefs and values, and they play a large role in public life through philanthropy and politics, according to Li-Huang. And many want to leave a legacy by giving back to society while generating a financial return on their investments.

“The holistic returns on cultural, environmental, social, and political causes are gaining importance in wealth management,” wrote Li-Huang. “The trend toward helping HNWIs address their personal aspirations and social-impact needs is part of a broader wealth management industry transition toward giving holistic wealth advice.”

Focus on goals while mitigating stress

How can advisers do that? For starters, according to Li-Huang, advisers can focus on goals-based financial planning, holistic wealth management, and services that address investments, lending, tax and estate planning, insurance, philanthropy, and succession planning.

With goals-based planning, wrote Li-Huang, success is measured by how clients are progressing toward their personalized goals rather than against a benchmark index such as the S&P 500 stock index. (Publicly traded securities don’t necessarily contribute that much to a HNWI’s wealth, notes Li-Huang, as just one in eight millionaires say equities were an important factor in their economic success.)

Still, she argues, HNWIs do need to invest in diversified markets and use tax-efficient strategies. And advisers can add value by “mitigating psychological costs, such as reducing anxiety rather than improving investment performance” and by focusing on financial planning and advice on savings and asset allocation.

Li-Huang cited research that suggests that investors don’t necessarily want the best risk-adjusted returns but, rather, the best returns they can achieve for the level of stress they have to experience, or what some call anxiety-adjusted returns.

In the cast of HNWIs, they tend to practice something called “emotional inoculation.” They outsource the part of the investment decision-making that induces stress, according to Li-Huang.

HNWIs are especially looking to their wealth manager for help with philanthropy. They are looking for “support and advice, such as setting goals and defining their personal role in their areas of interest, identifying and structuring investments, and measuring outcomes of their social impact efforts,” she wrote.

Given that advisers need to provide their HNWI clients with tax and philanthropy specialists.

In advisers they trust

When HNWIs consider selecting an adviser, they tend to focus more on honesty and trustworthiness than past investment performance or standard professional credentials, according to Li-Huang.

That’s not to say that professional credentials and competence don’t matter — they do — but, rather, that they are not sufficient in and of themselves, according to Li-Huang.

HNWIs — who tend to have less time and resources for due diligence than typical clients of financial advisers — use something called “trust heuristics” when searching for an adviser with whom to work.

In other words, they’re even more likely to assume that the category leaders are among the best in a highly regulated world even as they hold advisers referred by family members, friends and acquaintances in high regard, according to Li-Huang.

Consequently, perhaps, HNWIs tend to trust their advisers much more than less wealthy retail investor trust their financial advisers.

So, what is trust to a HNWI? According to Li-Huang, HNWis trust advisers who show signs that they’re acting in the client’s best interest, reach out proactively, charge reasonable fees, deliver mistake-free work — and admit when they’re wrong.

In many ways, attracting and retaining HNWIs isn’t much different that getting and keeping what are called “mass affluent” clients, who have with assets of less than $1 million. But the differences are worth noting, because the stakes are higher, and a bit of extra knowledge can pay off.

This story first ran on July 21, 2017. Reprinted with permission.

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