Remember conventional cruise control? Probably not. This 1980s technology allowed you to tell your car to keep to the same speed until you disengaged by tapping the brake pedal. It was designed for long distance highway driving. For advisors, it can be tempting to put your practice into cruise control in December and enjoy the holidays like everyone else. Here is an alternative.
Let us look at six strategies you should deploy to set up business for 2023. A sales manager I respected had the great observation: “People who finish the year strong start the next year strong.”
1. Everyone gets a performance review in January
Set them up now. Develop a routine for preparing the reports. Delegate the prep work when possible. Get the dates on the calendar.
Why: People are in a reflective mood in January. The concept of New Year’s Resolutions speaks to incremental improvement. Get ahead of the curve, before they are influenced by another advisor suggesting a change away from you.
2. Reach out to clients receiving an annual bonus
This is money in motion. Make a list of clients whose compensation is salary plus bonus. When will they be getting this related Christmas present? Plan to call a couple of weeks in advance to determine how to put it to good use.
Why: Your client might be tempted to spend their bonus. Family members may be suggesting ways to part with cash. They need a noble purpose (like investment) as a counter argument.
3. Fund retirement accounts immediately
Let us be optimistic and assume money grows over time. It does if it is earning interest. Realized growth and interest is taxed in regular accounts and deferred if it has been put away as retirement plan contributions.
Why: By making this suggestion and taking action, they have about 12 to 15 extra months of tax deferred growth. It also takes another item off their “to do” list.
4. Note who is retiring soon
Statistically, there should be a few clients. The pandemic has gotten people to reorder their priorities. Make a list of likely clients. Tactfully ask them when they will be retiring. Let them know you intend to treat them and some of their colleagues to lunch to celebrate before the big day. As the time gets closer, encourage them to invite peers who are also planning to retire soon.
Why:The help you provided in preparing your client for retirement will be obvious. This should get their pre-retiree peers pondering if they need help too.
5. Get those RMDs done
At the other end of the age spectrum are clients who must take required minimum distributions. The penalties for not taking them are substantial. This is something that weighs on their mind. It’s an example of a “round tuit.”
Why: You have taken another item off their to do list. Your client feels you are anticipating their needs.
6. Ask what did their accountant advised them to do
A client’s CPA can be a friend or foe. CPAs are friends if they recommend the client save more for retirement or earn more tax-exempt income. They are foes if they are only focus on fees. You want to know what advice clients’ accountants are giving them, and if it fits with your clients’ greater financial-planning needs and goals. Start by asking clients when they meet with their accountant to file their taxes. Build a list of names and dates.
Why: Advice should be worth what you pay for it. Your clients are paying their accountant for advice. They should be ready to act on good advice immediately. You can help implement it.
These are easy prep steps to line up business for 2023. Don’t miss the opportunity.
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,” is available on Amazon.