Start a Conversation

    Consider the financial advising experience from the client perspective. They’ve decided to entrust a stranger with a huge portion of their assets. More than that, they’ve entrusted a stranger with what those assets can enable: an envisioned future they want to make real. With their assets and future at stake, the most important factor for a client is going to be how much they trust their financial advisor.

    A financial advisor can build trust through portfolio performance, of course; but the market isn’t always cooperative, and sometimes clients get frustrated with the pace of progress towards their financial goals. Instead, the best tool a financial advisor has for building trust with their clients is a clear and honest communication strategy.

    Every advisor knows that client communication is essential, but we’ve often seen financial advisors fall prey to common misconceptions about client communication. In this article, we’ll break down three of the biggest myths about financial advisors' client communication strategies and the reality behind them.

    1. As an expert, part of my job is to ensure the client understands the details of my work.

    Educating your client is important, but a financial advisor is more than just a subject matter expert. If being a subject matter expert is all you are to a client, it can be easy to get lost in the details and only discuss the complicated, technical aspects of their portfolio, rather than the goals that brought them to you in the first place.

    The reality is that clients aren’t there to learn about alphas, betas, and standard deviations. Financial advisors are experts, true; but what that means to a client is that you can be trusted with the details. When it comes to client interactions, a financial advisor should serve as a guide and a steward of their clients’ wellbeing. What matters isn’t that a client understands the definition of a financial metric, but rather that they understand what their plan is, how the plan is evolving and progressing, and that you’re regularly attending to the health of their financial future.

    Download The Power of Outsourcing Investment Management to learn how  outsourcing can help your firm grow.

    2. My conversations with the client should be focused entirely on their portfolios.

    A financial advisor should discuss their client’s goals, the challenges facing their plan, adjustments that need to be made to their strategy and other topics directly related to their finances. But it shouldn’t be the only thing that an advisor should discuss with their clients.

    The reality is that a client’s financial wellbeing is deeply enmeshed in their life plan—to a certain extent, a financial advisor should be asking about and discussing all sorts of subjects. Political events, global upheaval, what’s happening with family members, life transitions—all of these are potentially relevant topics to discuss with a client.

    It might seem out of your scope, but getting to know your clients on a personal level is essential for 3 reasons:

    1. It builds trust and engagement. Clients are more likely to raise concerns and doubts with you if they feel comfortable around you and have frequent opportunities to talk. This, in turn, helps you to provide more effective and targeted financial advice.
    2. It’s a proactive approach to financial advising. Factors that impact a client’s financial plan can come from any arena in their life. If a client comes to you with a request, it’s best that you understand its origin and the motivations behind it, an understanding which can only be developed on a personal level.
    3. It’s a source of referrals for your business. It’s a simple truth: People like people who take an interest in them. As a financial advisor, if your clients feel that you’re personable, friendly, and engaged, they’ll be more likely to refer their friends and family members to you.

    3. Once I understand my client’s goals and once they understand how I’ll provide my services, I can turn my attention to other clients and other tasks.

    Ensuring that you’ve got the time to spend on all of your clients equally as well as the back-office tasks that keep your practice running is a delicate balancing act. But for many advisors, this attitude translates into a de-prioritization of the client and a transactional attitude toward the client-advisor relationship.

    The reality is that the client-advisor relationship is a relationship, which takes work and on-going attention. There isn’t a hard and fast point where an advisor can put a client on the back burner. There might be a point where fewer touchpoints are necessary and where your meetings can serve as check-ins, but regularly meeting and talking with your clients is key to ensuring they know you consider them as a human being rather than a source of business and that you have their best interests in mind.

    Naturally, there is only so much time in the day, but it shouldn’t be your clients who get deprioritized. There are numerous ways to inject more efficiency in your day and reduce the burden of administration.

    Making the time

    It seems simple: To be successful as a financial advisor, all you need to do is avoid pushing your client away with overly technical talk, get to know them on a personal level, and invest time and energy into the relationship. That would be simple if it was the only aspect of your job, but running a financial advising practice also requires investment research, marketing, business administration, and a small galaxy of tasks that eat away at your workweek.

    Fortunately, there are ways to make relationship-building more efficient and to create more time in your day to dedicate towards it. Embracing the use of social media, for example, is a fantastic way to engage with multiple clients and potential leads at once, enabling you to present a personable, friendly image and spark conversations that may otherwise not happen.

    Even after COVID-19 ceases to be a barrier to in-person contact, using video conferencing tools can make it easier for clients to have a discussion with you, lowering the barrier for those essential check-ins that make for a healthy client-advisor relationship.

    Outsourcing back-office work like investment management to a dedicated third-party is another way to ensure you have enough time in your week to dedicate towards clients. In fact, we commissioned a study to examine the impact that outsourcing investment management had on financial advisors’ workweek and found that advisors saved over 8 hours of time from outsourcing. As an advisor interested in spending more time with their clients, we recommend you review the study to see whether outsourcing is the best path forward to building better client relationships.

    investment outsourcing study

    Tag(s): Clients


    AssetMark is a leading provider of extensive wealth management and technology solutions that help financial advisors meet the ever-changing needs of their clients and businesses.

    September 21, 2022

    What You Need to Know About Fee-Based and Commission-Based Financial Advisor Compensation Models

    Financial advisory practices have changed over the years and are increasingly shifting away from commission-based models toward fee-based models. To understand this trend and...
    September 16, 2022

    7 Tips to Prepare Your Clients for a Market Downturn

    “May you live in interesting times” is usually taken as a good-natured sentiment. That is until things start to get interesting in a bad way. Economic volatility and market...
    September 9, 2022

    Securities-Backed Lines of Credit: 3 Ways Clients and Advisors Are Benefitting

    As the role of financial advisors evolves beyond pure investment management to increasingly holistic financial planning, solutions like SBLOCs have grown in popularity by...

    Sign Up For Our Blog

    Subscribe to get updates on new content.