For wealth managers, strategy is straightforward; tactics are hard. The framework of what you can do to establish a personal wealth management practice with more than a half billion dollars in assets under management (AUM) and generate additional revenues through life insurance commission, planning,and investment banking fees is simple and promises significant financial gains.

The formula was derived from extensive meta-analyses of the best practices of wealth managers and other leading private wealth industry professionals. It is used by private wealth industry professionals worldwide to double their incomes in 18 months or less or ensure they are earning $2 million or more annually.

The simple formula:
Referrals + Determining Objectives + Analysis + Collaborative Thinking + Expert Implementation = Exceptional Success

Simply put, you connect to prospective clients through referrals, determine what matters to them and how you can deliver value, help them make smart decisions, and expertly implement selected wealth management solutions.

The best way to connect with high-quality potential clients is through referrals from clients and centers of influence (COIs). This is well-known but often poorly achieved. Many wealth managers can quadruple the client referrals they are currently getting. Consequently, wealth managers need to maximize client referrals. Moreover, wealth managers must build strategic relationships with COIs, mainly accountants and attorneys, to work with the wealthiest clients.

According to Brett Van Bortel, director of consulting services with Invesco Global Consulting and co-author of Street-Smart Networking: How Financial and Legal Professionals Can Cultivate Centers of Influence for a Flood of New Affluent Clients, “Most wealth managers dabble in COI referral cultivation efforts, and lack a systematic model before they do so. This very rarely leads to success. However, if wealth managers commit to a systematic approach, the Law of Reciprocity creates career-long partnerships with a flow of HNW referrals each year.”

Determining Objectives
Pushing financial products sometimes results in new wealth management businesses but is highly ineffective. Such an orientation is characteristic of most wealth managers. Instead, the focus must be on the outcomes clients want and need.

“Our ability to determine a prospect’s objectives is incredibly effective in enabling us to find ways to add value,” says Harrison Till, President of Till Advisory and Capital Management. “Mastering processes like Everyone Wins is critical in our ability to learn about products, which is central to converting them into clients.”                                                                                         

Very often, an intricate analysis of a prospect’s or client’s financial and legal situation is required. For example, almost everyone wants to minimize taxes owed legally, but not everyone is taking steps to do so.

According to Brad Tedrick, who heads WFY Wealth Management, a distinctive division of Wright, Ford, Young & Co., Orange County's largest single-office accounting firm, “A competitive advantage we have is our attention to taxes when working with clients. To deliver superior results to clients, we collect all their financial and related data and analyze ways they can get the objectives they seek most cost-effectively.”

Today, this function requires a team of technical specialists. However, by 2030, generative artificial intelligence will replace most specialists and evolve the wealth manager role.

Collaborative Thinking
Exceptional success entails helping clients make smart decisions that work best for them. Wealth managers must help clients understand their choices to help them make smart decisions.

“There’s rarely only one way for clients to achieve their objectives,” says Homer Smith, director of the Integrated Family Office and co-author of Optimizing the Financial Lives of Clients: Harness the Power of an Accounting Firm’s Elite Wealth Management Practice, “It’s our responsibility to show them the different options including the advantages and disadvantages of each, ensure they understand what they are considering, and help them think through the possibilities. Sometimes, this leads to clients choosing options that don’t include wealth management solutions, and that’s alright because their choices work best for them.”

Expert Implementation
Once the clients decide on a course of action, wealth managers are often needed to implement the solutions. While almost all wealth managers claim to be proficient at implementation, the research shows this is not the case. Sometimes, it is because of the other professionals they have brought to the table. Sometimes, they and their platform are not up to the job.

According to Evan Jehle, CPA/PFS, a partner at FFO, a leading multi-family office, “High-quality implementation demands elevated attention to detail. Simple yet problematic mistakes occur when financial advisors who are too focused on attracting new business or righting the ship internally let vital details slip through the cracks. By ensuring each of our clients has a tailor-made team monitoring their daily needs, our firm prioritizes properly executing the core services that advance comprehensive wealth management and preservation strategies.”

The formula's components are unlikely to surprise you. What differentiates exceptionally successful wealth managers from those who are not is their ability to actualize the components. For example, most wealth managers are not proficient at determining objectives. They often take what the prospect says at face value and fail to identify critical concerns. Along the same lines, many wealth managers do a poor job of collaborative thinking because they are too focused on making a sale.

We have found that most wealth managers do a great job with the components now and again but are not as systematic about them as they could be. If this is you, by consciously focusing on the components, you can become more successful and exceptionally successful over time.

Jerry D. Prince is the director of Integrated Academy, part of Integrated Partners, a leading financial advisor firm. Russ Alan Prince is a strategist for family offices and the ultra-wealthy. He has co-authored 70 books in the field, including Making Smart Decisions: How Ultra-Wealthy Families Get Superior Wealth Planning Results.