For all the number crunchers and "algebraphiles" reading, I want to point out that the only two numbers that matter at this moment are pulse rate and blood pressure. Have you collected those numbers from your clients? And, more important, have you played a significant role in lowering both?
Taking these measures will not require a stethoscope or a blood pressure monitor. You'll simply need to pack your investment philosophy, your intuition and an injection of hope.
We are now living in a time where you will have to begin majoring in subjects that used to be minors and vice versa. The role of the advisor is morphing from the left-brain functions of analyzing, projecting numbers and simulating to the right-brain functions of philosophizing, being personal and inspiring hope and faith. Hope for a more informed financial tomorrow and faith in principles that stand the tests of time and turmoil.
The need for you to evolve as an advisor has been made clear in a study conducted by Van Kampen Consulting and Luntz, Maslansky Strategic Research. Van Kampen's Scott West, who designed the study, said that the researchers were interested in finding out exactly how much damage was done to the advisor/client relationship in 2008. They were wondering, from a fund manager's point of view, what it would take to get people to invest again through a local advisor.
They assembled focus groups in both Denver and New York. The groups had average investable assets of $250K, and half the subjects were 50 years of age or older. The participants were asked how the events had affected their relationships with their advisors and how much they blamed them for the current market trouble.
"Within 30 minutes in the Denver study group, it was apparent that every one of these clients was giving their advisor a free pass," says West. "At first, we thought maybe it was the altitude in Colorado, but the same sentiment was expressed at sea level in New York as well."
West said the sentiment was unanimous among clients, who saw the institutions, not advisors, as being culpable. One of the remarks was: "I can't fault my advisor for having bad information when the information they were given was flawed."
"The problem right now is not the client," West says. "It's the advisor. It you're paralyzed with feelings of shame, embarrassment and disappointment, you need to pick up the phone, get in your car and get face-to-face with every client."
The participants were very specific in their recommendations for their financial caregivers. The clients devised specific instructions on how to take their pulse and help lower their blood pressure. Here are their recommendations:
Be proactive (like you've never been before);
Get personal (know what's changed for the client); and
Stay positive (they need that from you right now).
Those feelings were echoed in another interview Van Kampen conducted with select advisors managing more than $1 billion in assets.
One of these subjects said that a proactive strategy alone helped her attract an influx of more than $150 million in assets since December 1, 2008. People were so blown away by her assertiveness in confronting last year's economic damage, misinformation and discouragement that they began to send her scores of clients whose advisors lacked similar motivation.