How to Retain Clients in the New Year

Being complacent about advisor-client bonds could send them into the arms of your competitors.

By Bryce Sanders
Bryce Sanders
Bryce Sanders

January is an interesting month. It is often a time for reflection and introspection. The concept of New Year’s resolutions speaks to incremental improvement. Clients often look at their investment performance in the past year. Did they do well enough?

People are in the mood to make changes. This includes your competitor suggesting they change advisors. All this thinking and contemplation should not be done with you in the background. You should be center stage.

Nothing beats face-to-face, in-person connection. Your client’s time is valuable. Your time is valuable too. Meeting face-to-face shows you are making an investment in the relationship. This should be your preferred method of contact. This might take place at one of five levels:

  1. Meeting over a meal. This might be your approach for your key client relationships.
  2. Meeting at their home or office. This is a sign of respect. You are meeting on their terms.
  3. Meeting at your office. This might be for your next tier of clients. It is face-to- face, but they are investing the travel time, not you.
  4. Video calling. Some clients winter elsewhere or have moved across the country. A video call lets you see each other.
  5. Telephone calls. Some clients are resistant to technology. You need to interact on their terms.

What Do You Talk About?

There are people in life who do not talk much. The character Gibbs on the CBS series “NCISis a good example. Because he is not “a talker,” when he speaks, people pay attention. You might be a talker, but what should you talk about?

1. Performance review

Every client should get a portfolio review within the first quarter. “Isn’t three months a long time?” you might ask. If you have 250 clients and could manage four reviews per weekday, it will take you almost 13 weeks to cover everyone!

Rationale: TV financial news and magazines will be talking about how the market did in 2023. What were the top performing funds? Wall Street bonuses will be news, too. Your client will be wondering: “How did I do?” In the PR world, they talk about “controlling the narrative.” You want to tell that story yourself, not have a competitor tell it.

2. Progress towards goals

Everyone wants to be a winner. Even if their performance numbers were great, they will still wonder why they were not the best. As an FYI, as of Dec. 13, 2023, the S&P 500 was up 21.62% YTD, while the NASDAQ Composite was up 40.36% YTD. If your clients’ equities were up 21%, they might wonder why they weren’t up 40%. People can be greedy. It makes sense to look at the return they need to achieve their goals.

Rationale: By measuring progress to goals, your clients are competing with themselves. If they have some back-to-back good years, this can lower the return they need in future years or bring financial independence a couple of years closer. Both are good stories to tell.

3. What have you done for them in 2023?

You have heard the expression: “What have you done for me lately?” During the political season, people talk about “do nothing” politicians. The politicians are probably doing lots of stuff, but it doesn’t get publicity. You fit into the same category, meaning your achievements might go unnoticed unless you showcase them.

Rationale: You helped your clients lock in a good rate on their savings, their safe money. You encouraged them to stay invested when they wanted to bail out of the market back in March. You made sure they took their required minimum distributions (RMDs). Remind them about the value you added.

4. Talk about their goals

Here is a great expression to lure someone’s client away from their advisor: “Does your advisor remember why you are investing?” This can be useful when the advisor simply talks about performance numbers. You do not want to fall into that trap, seeming to be indifferent and the client is just an account number.

Rationale: You want clients to feel you are emotionally invested in their success. Years ago, you saw the TV ads where the child is graduating from college and the financial advisor is standing next to the client at the graduation ceremony. You want them to know you are aware of what they want their money to do for them.

5. What has changed?

It is easy to assume you are captain of your client’s ocean liner, crossing the Atlantic. You keep it on course. Eventually you will reach your destination, but not for a while. Your client might have other ideas. Ask what has changed.

Rationale: Your clients may have illness in their immediate family. They may be tired of working. There may be grandchildren on the way. They may have a new favorite charity. They may be about to lose their job in a company reorganization. Lots of this information is not volunteered. You need to ask.

Play on Their Terms

You are making assumptions about how often your client wants you to be in touch. You are making decisions about how you will communicate with them. These can change over time. Here are some ways to stay on the same page:

1. Let them know how often you have communicated

Your clients might forget that you reached out monthly or quarterly. Can they answer a competitor’s question: “When did you last hear from your advisor?” Considerations: Remind them how often you have communicated and then ask, “Should we stick with this frequency? Change it?”

2. Reconfirm their preferred channel

Some clients like phone calls. Others prefer a text letting them know you need to talk. Considerations: Has anything changed? Have they decided to take a 111-night world cruise and not mentioned it? 

3. Has their risk tolerance changed?

Here is an area where younger people have an advantage: If they make a bad investment and lose half their assets, they have decades to make it back. The 70-year-old might not see it the same way. Considerations: Talk about the degree of risk in their portfolio over the past few years. Do they know what that means? Has their attitude changed?

By taking this approach, you are showing your clients, especially older ones, that you know who they are and why they invest. This should strengthen your advisor-client bonds.

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.


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