Many affluent investors employ a number of financial advisors to manage their money, especially as they acquire more liquid wealth. It’s probably an unintended byproduct of their knowing the value of diversification.

Those advisors with outstanding investment performance will likely not have to do a great deal to persuade clients to move more wealth over to them. (For the vast majority of advisors, that kind of performance is far outside the norm.) But those who do outperform face another question: How do you ask your affluent clients for more money to invest? We have found that the biggest obstacle for most advisors is not knowing how to ask.

The Asset Capture Process
One proven way to gather more assets from clients is to use this asset capture process, which is composed of four steps:

Step No. 1: Identify affluent clients with whom you have good relationships, if not all their investable assets. It is essential to have a very solid relationship with affluent clients in order to collect more of their assets to manage. The following things help:

• You have managed their money for more than five years.

• Over the years, they have given you additional business—given you more money to invest or referred another investor to you or purchased some other service.

• You know their goals well.

Step No. 2: Identify asset transfer opportunities. By and large, you need to ask for more assets if you want to get more assets. The aim is to find a “pool” of investable assets you are not managing and adroitly know when to tap it.

There are a number of times this could happen: when they need help with estate planning, for instance, or with retirement, asset protection, income taxes or charitable giving. Anytime you are asked to do new planning for any of these reasons, you can bring up the topic of handling more of the client’s wealth.

Other times, outside structural forces—such as stock market swings—offer you opportunities to glean additional assets. Whenever clients marry or divorce, that presents opportunity as well.

Sometimes it helps to conduct a comparison between yourself and the clients’ other advisors. Focus on what works in your favor, whether it is investment performance, relationship quality or some combination of the two. And finally, if your relationship with the client is already excellent, that can help; it is usually a matter of just following through and gathering up more assets. Your overall goal is to see where there are “openings.”

Step No. 3: Ask for additional assets. Only about one in 10 do. So without question, simply asking for the business will do wonders for your chances of getting it.
When you ask, you need to focus and position your service based on what is most important to the client. Knowing high-net-worth psychology can help you better relate to your wealthy clients and thus gain a “larger share of wallet.”

Here are some high-net-worth personality types and what you might say to them.

• To family stewards: “As we’ve discussed, markets go up and down. What’s happening in the market is not going to hurt us in the long term. You’re still going to have the monies to take care of your family the way we talked about.”

• To independents: “This is the market volatility we’ve been expecting. The fundamentals still look really good. Let’s keep our eye on things and stay focused on your goal of early retirement. Over the next few months, we want to make sure we’re on target for that goal.”

• To phobics: “Something is going on in the stock market. I’m carefully watching it for you. By the way, how are the kids?”

• To clients who like anonymity: “Remember the private memos I sent you about market volatility? This is what we expected. I want to assure you that I’m watching it carefully. I’ve put together a confidential analysis just for you. You’ll have it later today and we’ll talk about what steps we should take.”

• To accumulators: “Let’s understand both things going on. Concerning your principal, this is a bump in the road we’ve been expecting. Market fundamentals are still very good, so I’m confident we’ll achieve our growth objectives. Of course, the other thing going on is our opportunity to accumulate specific company stocks that are currently undervalued.”

• To moguls: “Our inside view is that this is the correction we’ve been waiting for. We want to take the high ground, so you have to decide when you want to make your move.”

• To VIPs: “We’ve pulled together some of our top people to review the situation for our most important clients like you. We see that our more astute investors are taking advantage of the situation.”

• To gamblers: “This is certainly a thrilling time. It’s time to think about what plays we should be making here to take advantage of what’s going on in the markets.”

• To innovators: “This is a time to be creative. Let’s look at what opportunities exist. All the volatility in the market calls for some state-of-the-art investment thinking.”

Of course, the precise wording of these reassurance calls and how the conversation progresses are a function of your particular affluent client and your conversational approach. Nevertheless, the advantage of using high-net-worth psychology is to ensure the focus is solidly on the client’s needs, wants and preferences.

Step No. 4: Say “Thank you” and reinforce the asset-transfer decision. We have seen far too many financial advisors who are handed more money to invest become very impressed with themselves and fail to appropriately thank these clients for the extra opportunity to serve. You need to let the clients know you greatly appreciate the faith they have in you.

When you received more money to manage, you did it by stressing what was really important to them. Now you need to circle back and reinforce their asset transfer decision.

Use the same high-net-worth psychology, reiterating for family stewards, for example, how you will better serve their families or for independents how their faith in you will allow them to attain financial freedom … and so on.

Russ Alan Prince is president of R.A. Prince & Associates.
Brett Van Bortel is director of consulting services for Invesco Consulting.