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Assuaging Client Anxiety about Abandonment

October 27, 2017

This time we hear from Mark Germain, founder and CEO of Beacon Wealth Management in Hackensack, N.J. He discusses how conversations with longtime clients helped him shift his firm’s approach.

I have a client who has been with me for 33 years. In our very first conversation back when I was building my firm in 1984, this couple asked me how many clients I could handle. I told them an advisor shouldn’t handle more than 100 clients.

I took a brief hiatus from my firm to work at a software start-up and then restarted the firm in 2002. This couple wanted to be my client again but they had some concerns. They wanted my assurance that I’d never leave again before they brought their business back to me.

Two years ago I’d told these same clients I was planning on expanding the firm. They again expressed concern about my availability. Referring back to our conversation in 1984, they said, “You told us you can only personally handle about a hundred clients at a time. How are you going to do that while expanding?”

This client – as well as 10 to 12 others I spoke with – made it absolutely clear it was important to them that I be their primary contact for all aspects of their account. They told me point-blank that if something happened to me they would leave the firm. I sympathized with these clients’ desire for personal attention from me but I also realized the business model they wanted – which put me at the head of every account – was ultimately not sustainable.

These conversations with clients helped me realize I needed to shift my firm’s approach, particularly as I wanted to start decreasing my hours. For the firm’s health, I could not be the only advisor that clients would trust to deliver financial advice.

I addressed this by shifting the firm’s approach in a significant way. Nowadays clients are serviced by teams that include an associate advisor who attends meetings not just as a note taker, but as a full participant. We give them specific items to discuss at client meetings so they are in a position to step in as the lead advisor when necessary. That way, whether we’re dealing with planned or unplanned changes in my availability, the client has another advisor who they are comfortable with and trust.

Mark Germain

In addition to having associate advisors interact more with clients, we also now have them interact with our clients’ grown children, who are part of the millennial generation. Over time, there will be a natural transition to associate advisors as I become less and less active in the day-to-day operations of the business.

The team approach to clients is also critical to new client acquisitions. We once lost the chance to work with a very well-heeled client because they didn’t think we had the depth to service them if something happened to me. Now we bring associate advisors to new client meetings and make it clear right off the bat that their interactions will be with the advising team, not just me.

Advising is a relationship-driven business. While it’s crucial to forge strong bonds with clients, it’s also important to ensure your clients have relationships with the advisors who may end up working with them in case you need to scale back on work for any reason. Fostering those connections well in advance helps ease the transition and ensures that your clients feel taken care of, no matter what happens.