With October being Financial Planning Month, the spotlight is on teaching consumers the importance of developing a comprehensive financial plan that will help them secure a sound financial future. We asked two MDRT members, Brenton Harrison, a financial advisor at Henderson Financial Group, and Michael Ross, owner of Cornerstone Financial Group, for their recommendations for motivating clients to take action.
Motivating a client is not only about getting them to agree to developing a plan, Harrison said, but they must also agree to develop that plan using that particular advisor’s methodologies. Every advisor has different thoughts about finances, the markets, budgeting, and even estate planning.
“It’s important to educate prospects on the power of planning, while giving insight into how the advisor’s methodologies inform their planning,” he said. This insight could take the form of webinars, podcasts, blogs or social media posts that cover financial topics and expose the audience to the advisor’s thought processes.
Other advisors offer complimentary initial sessions, Harrison added, when prospects can get a feel for the advisor and whether both sides are interested in moving on to developing a financial plan.
Best prospects for financial planning
While everyone can benefit from financial advice, there are elements of a prospect’s life that need to be somewhat predictable to get value from the projections found in financial plans. For example, Harrison explained, a 25-year-old, early- career professional may not get much utility out of a financial plan projecting how much they need to save or invest to retire at a certain income, when so much of their family structure, career prospects and expenses are yet to be decided.
“Conversely, a married 40-year-old with a family likely has variables in their plan – income, family structure, health concerns, etc. – that are established, and these variables can be used to analyze their current and future financial picture more accurately,” he said.
Seeking prospects online
And what social media tools work the best for attracting prospects? After many failed attempts at launching a profile on every social-media platform under the sun, Harrison said that he has come to believe “that the best platform is the one that allows you to show your authentic self to prospects, and market those traits to those you enjoy working with the most.”
Some advisors work with young professionals who naturally gravitate towards the short-form videos or quick bursts of value found on Instagram, he said. Others are educators and prefer platforms where they can share longer-form blog or video content, like Facebook Live, LinkedIn or even YouTube.
“Whichever platform is chosen,” Harrison said, “I’d encourage advisors to focus on getting their prospects off social media and on to their email list, where they can engage and share personalized content that will build a community over time.”
For his part, Ross said while he does not use social media that much, he knows that others advisors are finding prospects through LinkedIn, Facebook and Twitter.
After prospects have been found and they agree to meet with the advisor, some of them may have objections to actually signing on the dotted line. For example, Ross said, some might say: “I don’t need a full plan—just take my rollover.” In this case, it would be in the advisor’s best interest to know their client as well as they can, and really push to get all of the data to assemble a plan that the client would agree on, he advised.
In other cases, Ross said, some clients don’t want to give all of the information about what they have, or they overinflate or underinflate balances.
“I would say the better the data that you have, the better the recommendations can be,” Ross said, adding, “Try getting your clients to be more comfortable with being more open with you. When working with a client, it is a relationship that needs to be built on trust. You have to be honest with each other.”
Other objections to developing a plan are the work involved in organizing finances and the work that may be needed to change behavior that is obstructing growth, said Harrison. The average person isn’t keen on paying money – in many cases, thousands of dollars – to gather documents, analyze their spending, and schedule multiple meetings, just to find out that more work needs to be done to shore up their finances.
“It’s the advisor’s job to connect the dots between the upfront costs and work that goes into developing a plan, and the value it could provide over the course of the client’s life and the lives of their family’s future generations,” Harrison said.
Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected].