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In our ever-changing world, marketing methods, client-relationship strategies
and selling techniques seem destined to continually evolve. While some
age-old methods for achieving success may never become outdated, acquiring and
offering better products and improved delivery systems are essential progressive
strategies. The 80's office manager who did not understand all of the hype
over the new fax machine would deem it laughable to be without one now.
Who would have guessed, not many years ago, how computers would be impacting our
lives today? Change is not only imminent...it is also necessary.
The Diversification of Financial-Related Services
It is an undeniable fact that the demographics and attitude of the general
public is permanently changing the way financial planning, risk-management and
estate planning needs are being addressed. An increasing number of people,
especially the more mature and sophisticated clientele, are looking for a
one-stop-office that can address all of these needs
together. That is why banks are busy hiring, housing, and promoting
insurance agents and B/D registered representatives. The number of
accountants and attorneys procuring licenses to sell financial/insurance
products is increasing. Many broker dealers and mutual fund companies now
offer an assortment of financial services including checking account liquidity,
asset-management, and (most currently) estate planning. Why? They
want (and need) to maintain control of their broker-client relationship!
Important Elements to Any Family Plan
There are essentially four financial components for most family estates: (i)
accumulation, (ii) growth, (iii) preservation, and (iv) transfer of
assets. Most financial advisors (i.e., planners, brokers, agents, and
accountants who sell insurance and/or securities or who provide fee-only
advisory services) are trained to help the client grow and preserve the family
estate. But the fourth component - the transfer of assets - has been
customarily disregarded by the advisor and unwisely left to others. If you
as an advisor are not able to assist your clients at even a basic level with
their estate planning needs then it is unfortunate for both you and your
clients. The funding process and all-important follow through are
usually essential parts in the implementation of most any estate plan.
Full and complete plan implementation is probably not going to happen without
you being involved, each time, in a collaborative multi-disciplinary effort
toward that end.
Be Prepared to Address Your Client's Planning Questions
Sooner or later your client will confide in you with certain estate planning
questions. Here are a few examples: What should I do about
planning my estate? Should I have a will or a trust in place or use some
other method(s) to meet my goals? What actually is probate and should I be
concerned? How does life insurance affect my estate for tax
purposes? Are there potential problems associated with
rights-of-survivorship clauses in my realty deeds? How can I arrange to
help my dependent child (or grandchild) and/or maintain a level of control
regarding specific family conditions after I am gone? Because you have
only limited knowledge or experience with which to discuss your client's
concerns, you dutifully recommend him to a lawyer or other professional who you
may have heard about, but of whom you have performed no personal due diligence
concerning that person's character and ability. That is a common practice
which often creates disappointment, if not real problems, for all
parties.
Control Over Client Relationships is Vitally Important
Later, after your client visits your legal referral, you discover that the
estate planning work that should have been done was either never completed, or
inadequately installed, or even totally disregarded. Moreover, the
thoughtful recommendations that you made earlier were discounted by the referral
contact. Alas, your client is now frustrated and (worse) starts
questioning your judgment and professional ability. It is at this point
that you have lost meaningful control of your client relationship.
But take heart, the rules of engagement are changing! In today's
environment - with the emergence of multi-disciplinary networking practices -
the concerned financial advisor can and should take positive action to avoid the
loss of client control through ill-fated referrals.
Don't Lose the Advantage of Your Existing Position
If you are selling insurance products, you are already involved with front-line
estate planning issues. (Don't you assist your clients in choosing
the beneficiaries of their insurance policies?) However, you probably
usually end up only skirting the outer circles of your clients' other important
planning concerns and leave it at that. As a result, your clients' overall
estate planning objectives are still left unattended, notwithstanding the fact
that their insurance policies are now in place, and they still have more
questions than answers. By not taking advantage of this crucial situation,
you are probably foregoing any additional opportunities with that particular
client. If you find that you are unable to assist your clients further,
then you will almost always be (a) forcing your clients to look elsewhere to
meet their estate planning needs, thereby (b) leaving additional business on the
table for someone else, and ultimately (c) forfeiting long-term client
relationships. The problem should not be neglected for obvious reasons,
and it can be completely avoided through adequate planning and preparation on
your part.
Multi-disciplinary Networking - a Powerful Tool
The advisor who recognizes the issues should seek out and network with qualified
professionals in an environment that he can control. In working
within a multi-disciplinary environment that he can "manage", the advisor can
turn this potentially adverse one-stop-office trend into an
opportunity. Multi-disciplinary networking relationships can
exponentially increase the advisor's knowledge, ability and effectiveness in the
market place. Thus, by incorporating and applying this network application
into your practice, you as an advisor can provide information, products, and
services to your client which you could not otherwise offer alone, thereby
significantly enhancing your value and position with your clients.
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