The affluent with substantial liquid assets are strongly inclined to use a number of financial advisors. For them, this is a form of diversification—a lesson they learned well from the financial advisory industry.
Despite this tendency, you can effectively gather a greater percentage of your wealthy clients’ assets.
Asset capture is important because it not only results in more revenue, but also does so without adding any substantial cost. Garnering more assets from your current affluent clients amounts to picking off the low-hanging fruit.
If your investment performance is consistently outstanding, then you will tend to find that you will often not need to solicit your affluent clients for more money to invest. Instead, they’ll usually be happy to give you what they can. In this scenario, you are delivering investment performance. Likewise, if your investments perform poorly, you would likely lose assets and affluent clients.
For the overwhelming majority of financial advisors, however, consistently outstanding performance is not the norm. If this is the case with you, then you are going to have to ask for more money to invest from your wealthy clients.
But this leads to a problem for most advisors. Very few of them ask their clients for more money to invest because they don’t know how to ask.
Many financial advisors are uncomfortable asking the question. They wrestle with the question of who to ask, and when.
There is, however, a right way to ask for more assets and it can be approached in four steps:
Step #1: Create loyal, affluent clients. Exceptional investment performance is a factor in motivating affluent clients to give more money. But the average advisor who delivers average performance can still gather assets from clients by adding value in other ways. In short, make your clients loyal to you by providing other services.
Step #2: Identify asset transfer opportunities. To devise a strategy, you first need to know which of your clients has more assets you could be managing.