Many good advisors hesitate approaching friends for business. It’s the risk to friendship dilemma. Here’s a case for making the effort.

The $10 Bottle Of Wine
We are wine fans. We know lots of others, including people who just happen to like wine. Everyone likes a good deal, especially the wealthy.

Suppose you came across a great tasting wine, very similar to a high-end version of wine you like. It’s on closeout. It’s 10 bucks. Would you tell your friends? OK, some would buy it up and keep it a secret. Most other people would tell friends: “Hey, I got this great deal. Let me tell you about it!”

Would your friend say:
• “Thanks, but I already have a store where I buy my wine.”
• “You might like it, but if I don’t, it might put our friendship at risk.”
• “I consider my wine tastes personal. Please don’t ask again.”

Of course not! They would be happy you made the effort to share your find!

Now let’s look at the reasons you made the effort:
• You found something good you think would benefit them.
• You know their preferences.
• You are a sharing, giving person.

Those reasons also establish the rationale to talk about investing. Your sincere concern, competence and enthusiasm will come through. Everyone should have the opportunity to say no. 

The Death Of A Spouse
Years ago, a regional manager for a financial services firm shared the story of an advisor with a friend whose spouse died. Out of respect they maintained a low profile, not stepping in to talk business. Over time, the friend grew cold and distant. The advisor was perplexed.

They finally asked. The friend said: “When my spouse died, I was left with lots of investment and financial issues I needed to sort through. I was having a tough time. You are in that field. You were in a position to help. You never asked.” Everyone should have the opportunity to say no.

Here’s where we run into trouble. It’s a simple misconception. We assume in two income households, financial decisions are made jointly. We assume everyone is financially literate, because we are! We don’t realize in some relationships, certain tasks are handled entirely by one partner.

Two examples:
• Years ago, one of my wife’s friends jokingly said: “My husband would never divorce me. He has no idea where the money is!”
• Last night, we were having dinner with friends. We all knew the surviving spouse whose partner just died after a long battle with cancer. He is a retired professional. They remarked “He is completely overwhelmed because now the investments and finances are in his lap.” She handled it for decades. It’s not his area of expertise. A close friend needs to step up and say: “Let me help. I can answer your questions.”

There are times you need to take the initiative. If you are tactful, there shouldn’t be any problems.

Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, Captivating the Wealthy Investor can be found on Amazon.