Let’s make this clear: The investment-only advisor is going the way of the dinosaur. The financial planning-centric financial advisor will be treated like a celebrity by their clients and by supporting vendors (e.g., friendly trustees).  Allowing for a growing financial advisor practice. 

Yet, many advisors still weigh whether to pursue a prospect based solely on their current portfolio size.


(3 Ideas) How financial advisors can avoid becoming a commodity


Grow Prospective Client List

Long-term successful entrepreneurs know about planting seeds in many different fields.

But what about building out short-term goals for adding to your firm's AUM?

Advisors need to segment their prospect client list and marketing efforts.

Segment A is about growing small portfolio accounts ($500,000 to $1 million) with external large asset locations. Examples of those exernal asset locations are 401(k)s, or businesses with real enterprise value. Because behind a prospect’s portfolio assets you see today are potentially a lot more coming down the road. That's excluding existing clients and their trusts (more on that below)

If an investor in their late 50s asks you to manage their $500,000 Rollover IRA, you might be hesitant at first.

But what if they have five times that amount saved in a 401(k) account they’ll want to eventually roll over to a managed IRA account when they retire?

Or if they are an entrepreneur with a company valued at $6 million EBITDA?

Or what about other low-AUM prospects who may have windfalls in the wings? Newly minted physicians and lawyers who haven’t saved a lot now but will accelerate it when they become partners. Business owners who stand to make a fortune when they sell their firm at some point. Middle-income millennials at startup companies who may become instant millionaires when they cash in their stock options.

You want to be there before these liquidity events occur, not after, when you’re competing against other advisors for their business.

Finding Prospective Clients

It's pretty simple. Write down the type of clients you want to capture in your local geographic area. Are there big companies with retirees? Do retirees move to your area? Are new businesses being created? Are there various entrepreneurial peer-to-peer learning groups in your area?

Go to where the future wealthy families will be in the future (e.g., groups entrepreneurs need to join) Educate them on beginning mistakes. Sell nothing. Just educate and share knowledge in quick and easy 30-minute snippets. 

Then use the following  websites to narrow down your target prospective clients using AI tools:

a) www.seamless.io

b) Google Ad Words

You will need to hire a marketing agency that really focuses on results (or as they call it - conversion rate optimization - CRO). Do not waste money on fancy websites. It's all about the landing page and the CRO experience for the prospective client. 

Trust Review Checklist for Financial Advisors

Investment-only FAs

Everybody thinks they know about investments. Kinda like everyone thinks they know enough to criticize an NFL coach on Monday morning. 

But if you want to be that person, you need to be more than the old-school investment-only advisor. You can write long essays about the economic lemons and potential lemonade solutions plaguing our financial system today. But really, today’s clients aren’t just looking for portfolio management. They want to work with a financial planner who can provide strategies and solutions to help them manage cashflows, shrink their debts, reduce their taxes, while simultaneously saving for retirement and their children’s college education.

They want to avoid making beginner mistakes on their testamentary trusts

They want to know how to pick any type of trustee for their estate planning documents. 

And, as they get older, they’ll also need help figuring out how to pass their wealth on to their children and favorite causes in the most tax-efficient manner.

When you successfully use financial planning as a hook to land these will-be-wealthy clients, they’ll eventually bring you the assets they have now—and the windfalls they’ll receive later.

Accepting them also opens an important gateway to your best source of leads—client referrals.

For multi-advisor practices this approach becomes even more important. 

 Old School Advisor Marketing

If I accepted every unsolicited retire-planning-lunch-and-learn offer I received in the mail from financial advisors I’ve never heard of, I’d probably need stomach surgery by now.

Why advisors still spend money on these and other ineffective direct mail and digital marketing campaigns is beyond me. Especially when the most time-tested way to get new prospects costs them nothing

Client referrals

Of course, you want to do this strategically. The biggest mistake advisors often make is asking a client, “Do you have any friends, family members or coworkers you could send my way?”

It’s too open-ended for clients to answer. Instead, you want to help them identify the people who would be most impressed by the services and solutions you offer.

Start with the clients who’ve experienced first-hand your ability to solve complex financial challenges.

The executive you’ve helped to tax-efficiently liquidate their concentration in company stock to build a more diversified, income-generating retirement portfolio. The older couple you’ve worked with to develop an estate planning strategy to pass their wealth on to their heirs. The younger, middle-income family for whom you’ve developed a comprehensive plan to help them save confidently for their short-and-long-term financial goals.

If these clients are satisfied with the solutions and exceptional service you’ve provided, ask them if they’ll make a “warm introduction” on your behalf with people they know facing similar challenges.

I can’t emphasize enough the importance of the “warm” part.

Too often a client will simply hand over the names, email addresses and phone numbers of a few friends and “give the advisor permission” to reach out to these people directly, saying that “(Client’s name) recommended I contact you.”

I can tell you from experience this never works. We’ve all become trained to delete cold emails and hang up on telemarketing calls.

Instead, when a client or someone else in my network suggests a few referrals they’d be willing to send my way (e.g., other advisors eventually needing our friendly trustee services), I ask them to send them an email introducing me and provide them with specific language for the email suggesting why this prospect may benefit from connecting with me.

Using Centers of Influence

When meeting with your centers of influence exchanging ideas generates a lasting relationship of win-win. Eventually, business referrals may occur. They will do so organically and tailored to your client type.

Here are a few questions to ask an estate attorney or CPA:

  • In the last 12 months what frustrating stories have you experienced with corporate trustees?
  • What changes have you made to leverage technology to serve clients better?
  • How are you finding the next generation of employees to add enterprise value to your firm?
  • What changes to [insert tax or legal] have frustrated your clients the most this year?
  • When reading your industry periodicals what are your scanning or looking for?
  • Sometimes we are in crunch time, how have you juggled crunch time issues between your top clients?
  • What are your peers worried about for the future of your industry?

Like advisors, attorneys and CPAs have peer groups (formal or informal). The informal peer groups are the strongest. If you are working well with a current COI and ask them for a referral be specific and with context for the warm introduction email.

Quid pro quo relationships never last and leave everyone feeling empty.

Missing key COI to business development

Nearly all financial advisors have COI networks. But I often find that it doesn’t include a corporate trustee a championing the advisor relationship.

Maybe it’s because advisors assume that when their clients need to establish a trust that their attorney will find a trustee for them. Or maybe it’s because advisors think corporate trustees will poach their assets.

In reality, many estate attorneys simply don’t have relationships with independent corporate trustees located in “trust-friendly” states that let advisors manage the assets in their clients’ trusts.

Advisors who make the effort to establish relationships with independent corporate trustees are in a better position to collaborate with their clients’ accountants and estate attorneys to come up with appropriate directed-trust solutions where the advisor will still get to manage their clients’ assets when they pass on.

Another benefit? Managing trust assets gives the advisor the ability to establish closer relationships with the beneficiaries of the trust, giving them the inside track of adding your clients’ children and grandchildren to your book of business.


Competitive mindset: A growing financial advisory firm

Advisors who want to grow their practices need to think differently about the way they market themselves and their firms. Positioning yourself as a provider of financial solutions and leveraging your best clients as your principal prospect sources will give you a leg up over old-school investment-only advisors who don’t recognize the importance of changing with the times.