Not all financial advisors are interested in building a practice with the wealthy. So take a moment to consider how important affluent clients are to your business success. If they are indeed important, take another moment to consider how difficult it is to build a robust high-net-worth practice.

When we address these issues in surveys of financial advisors as well as other types of professionals working with individuals and families, we always find that the affluent are the ideal and preferred clients for the most successful professionals and those looking to fast-track to ever greater pecuniary achievements.

This is not at all surprising. When we “run the numbers,” we find it’s necessary for advisors to have a solid book of affluent clients in order to generate the revenues needed to create meaningful personal wealth.

The Value Of The Affluent
When it comes to the affluent, the math on the asset side of the profit and loss statement is pretty simple. Based on decades of research with the range of wealth from the lowly millionaire to the super-rich (net worth = $500 million or more), their value to various professionals can be simplified as follows:

• The affluent usually have greater financial and professional services needs and will likely need ongoing assistance and expertise. Overall, the affluent are going to use a broad range of services and products, and they’re going to use many of them consistently (e.g., money management) or repeatedly (e.g., tax planning). Furthermore, as their lives change—a given—their use of services and products should need adjustment, which means more business opportunities for a broad spectrum of professionals. Consequently, the affluent provide financial advisors with the potential for greater revenues initially and, in many cases, continuously.

• The affluent have the financial wherewithal to acquire the services and products they deem worthwhile. While the less economically endowed might have many of the very same needs and wants of the wealthy, it’s the well-to-do who can afford the quality know-how and deliverables provided by financial advisors as well as a diverse range of professionals. In effect, they have the financial resources to pay—and pay well—for expertise.

• The affluent have more extensive networks and are more likely to have strong influence within their networks. It’s the nature of wealth to directly and indirectly productively connect with others. In studying the wealth-creating mind sets and methodologies of self-made millionaires, we regularly find their facility at strategically networking to be a major factor in their success. In adroitly working with the affluent, financial advisors can position themselves to financially benefit from the relationship capital they’ve created.

Taken together, when we do the economic calculus, affluent clients generate a disproportionate amount of revenues compared with those less prosperous. Again, compared with those less well-heeled, they also provide superior means to increase the client base of financial advisors with high-caliber referrals. Together, this can result in you building a substantial and very profitable practice.

Let’s now briefly consider some issues on the liability side of the profit and loss statement:

• The affluent can be demanding clients. The wealthy usually recognize their value to the professionals they employ. In addition, they’ve often achieved their stature because they can focus the efforts to get what they want. For financial advisors, this means they can be difficult clients. There’s no question that financial advisors commonly need to have a very high-quality, proactive and responsive capability to work effectively with many of the wealthy.

• The affluent can be “cheap.” This is an all-too-common complaint among many professionals. Yes, some of them are cheap and will not pay for talent, knowledge or skill. However, most want “value” for their money, and many professionals, more often than not, fail to communicate the value they provide, leaving the wealthy to see only the cost. When financial advisors effectively communicate the value they provide and not just what it costs, they usually find the wealthy willing to pay appropriately.

• The affluent can be highly selective when it comes to the financial advisors they choose to work with. With so many financial advisors targeting the affluent, the wealthy can, if they choose, comparison shop. While there are some astoundingly effective ways to access the wealthy, such as sourcing them through centers of influence and by proactively generating high-quality client referrals, financial advisors need to be effectively positioned and adept at various business development approaches to win over wealthy prospects.

When you add up everything, it’s fair to say that building a highly successful practice predicated on affluent clients is not easy, but it can be tremendously rewarding.