This week we hear from Chris Congema of Landmark Wealth Management in Melville, N.Y. He recalls how one client gave him insight to succeed where another advisor had fallen short.
Over the years, I’ve learned that no two clients are the same. As a small firm, we set ourselves apart by paying attention to the little differences between people. We can give them the personalized attention that bigger firms — and certainly robo-advisors — cannot. Simply, getting to know our clients personally and forging a real relationship with them is what we do.
I connect with clients early on by asking a series of questions during our initial meeting. If they’re switching advisors, I want to know why. Often, they’ll tell you exactly what their previous advisor did that wasn’t working for them — and in the process you’ll get to know their “hot buttons.” Once you start to know them on that level, you’re on the way to avoiding mistakes made by previous advisors.
About a year ago, a new potential client met with us, an accountant who was unhappy with his financial advice. As I usually do, I asked what he didn’t like about the broker he had been using. He said he would occasionally get a proxy voting statement in the mail, and he’d ask his broker how he should vote. He was frustrated when the broker would just give a perfunctory one-word answer. I sat up and paid attention. Generally, we don’t get involved in advising clients on how to exercise their shareholder voting rights — we usually don’t even invest in individual stocks. But with his story, the client was giving us the message that this was an area where he’d like a bit more in-depth information.
Sure enough, a few months after he became a client, he came to us with a couple of these questions. One was on his own behalf; the other was for one of his tax clients, who had brought him a question about a reorganization item for a particular stock. Because I knew this was a hot button for him, I spent time researching the situation. The next time we spoke, I was able to give him a detailed explanation for what we thought he should do and the pros and cons of each side.
I went above and beyond what I would’ve typically done in this situation, because I knew it mattered to him. He was extremely pleased with the thorough answer. Then, when he shared our information with his tax client, he got to look like a superstar there as well. We were able to differentiate ourselves from his previous advisor with just a little bit of extra work. It really cemented his loyalty to us as a client.
Asking why prospective clients want to leave their current advisor can help you get a sense of whether their expectations are realistic or not. If they tell me they’re making the switch because the Dow is up 13% but their portfolio is only up 6%, they might have unrealistic expectations and are probably not the best fit for our firm.
It’s also important to ask new clients what they do like about the advisor they’re leaving. If there are things they like, we want to make sure we’re doing those things. If it’s something we don’t normally do, we may need to add it into our practice. Or if it’s something they liked but we’re not able to do, we want to be up front about that from the get-go. When you set clear expectations and start off on the right foot, you avoid having a dissatisfied client down the road.