Editor’s note: Bryce Sanders is a longtime columnist with Rethinking65. Read more of his articles here.
Bryce Sanders
Not all clients are on the right side of the grass. Some are six feet under, officially dead although still appearing to be alive on social media because no one thought to shut down their account. Then there are two groups of clients who I refer to as “the undead.” Some of them still retain a small portion of their assets at your firm but you cannot raise these clients on the phone or otherwise. With the other group of undead clients, also known as “the recently departed,” you did everything right yet they moved their accounts to another firm.
Your dead clients are gone. Their accounts are now part of their estates. The assets have or will transfer to heirs. (You may be able to capture those assets, but that’s a topic for another day.). However, it’s still possible to resuscitate your undead clients. Here’s a closer look.
When the Lights Are On But Nobody is Home
This client has moved some assets away. The remaining account is small. It is not generating any revenue. Perhaps the remaining securities of this client require prompt action, but you cannot get the client’s attention. Calls and e-mails go unanswered. It’s like pushing on a string.
I had a similar problem when an artist friend who lives in Hawaii dropped out of sight. He lived on the Kihei section of Maui, the island that suffered massive fires in 2023. Phone calls didn’t go through. Neither did texts. No luck with e-mails. We tried surface mail, including priority mail. Nothing was returned.
As an advisor, there is the very real possibility your client may actually be dead. Searching the internet for obituaries makes sense. Some firms include an emergency contact as part of the documentation for opening an account.It is always important to respect client confidentiality, but there may be a designated person you can call who can check on them.
So let’s say you confirm your client is alive but they remain uncommunicative. What can you do? You might turn up on their doorstep, but that might be seen as stalking. Not a good look. Although showing up in their favorite coffee shop or restaurant might bring you together, that looks like stalking too. On the positive side, you might run into them at a social event, especially if you are both active in the community.
If your paths do cross, make it a point to greet your client, instead of avoiding them. Exchanging pleasantries will get you speaking without being pushy. This can lay the groundwork for another strategy later.
An important consideration: If your client resurfaces months later, could you show you made every reasonable effort was made to contact them?
When Silence Gets Creepy
Everyone makes mistakes. Advisors, too. Have you ever had a client with a metaphorical dark cloud over their head? If you lose one phone message a week, it’s their call to you. If one account statement gets shredded in the mail and never delivered, it’s theirs. If one problem doesn’t get solved because someone dropped the ball, it’s theirs. Or perhaps their portfolio performance stinks.
When you call this client, they don’t get angry. They are very polite, but they are establishing distance. You know this account is on its way out the door, it just has not happened yet. From my experience, I know you need to be proactive and try to save the relationship, even if you think there is no chance of succeeding. At least you tied.
An advisor in the Boston area had a great strategy: He would invite the client and their spouse out to dinner. The restaurant served as a neutral space. Once the drinks arrived and the food was ordered, the client would say, “Things haven’t been good lately.” Then he stopped talking.
If the flew into a rage, he sat there and took the abuse. He realized he needed to walk a tightrope. He didn’t accept that everything the client said was correct, but didn’t counter with his arguments. The rage eventually died down. Sometimes, the advisor made a few corrections or comments to defend his actions, but he kept them brief. He’d look the client in the eyes and say, “What can we do to move forward?”
It is very difficult for the client, who had given the advisor a hard time, to say, “No, we cannot move forward.” Regardless of the outcome, the advisor made the effort to save the relationship.
When the Train Has Left the Station
Clients leave. Sometimes there is no warning. You look at the screen and see that the assets grew legs that are walking away.
Why did the client leave? Perhaps they told you. Somehow, it seems the grass looks greener on the other side of the street. They have left for greener pastures. Some advisors rationalize the loss with “They were not a good fit” or “They weren’t a major client.” This is denial. There is a big, unanswered question: “Were the pastures actually greener? What happened next?”
A New York advisor makes the effort to find out. After several months, the advisor call the former client and acknowledge that the client had left. “You had your reasons,” the advisor said, and then explained that they wanted to be sure everything has worked out in the client’s new “home.” The advisor uses expressions like “I enjoyed working with you” and “You were an important client to me.”
It’s possible the move might not have been as great as expected and the client may be suffering remorse for switching advisors. Perhaps pride is keeping the client from admitting their mistake. In this scenario, the advisor has met them half way. The client might say, “I am glad you called.”
The train can come back to the station. Anything is possible.
‘My Spouse Can’t Stand You’
In the advisor/client relationship, one person in a client couple often emerges as the decision maker. The advisor seeks them out when a decision is needed. Sometimes they treat the client’s spouse like a message taker. This makes the spouse seethe. If the spouse is a woman, note that research shows women outlive men by about six years. Other research shows 70% of widows drop their husband’s advisor. They could wait you out and then drop you like a hot potato when their spouse passes.
Other spouses prefer a quicker result, making the primary contact person’s life miserable. They might say, “I don’t know why you stick with that advisor” and “What has your advisor ever done for us.” An advisor I met in Louisiana could detect when he had this problem. He had two strategies to try to solve it.
First, he’d call when the primary contact person would not be home. He’d reach the spouse and say, “Maybe I am not the right advisor for you.” This might lead to a meeting where he’d then implement his second strategy: focusing the majority of his attention on the skeptical spouse. By learning and discussing every detail of their investments, he established himself as an expert. He ended these meetings by mentioning investment decisions should always be made based on facts, not emotion. Showing the lesser-involved spouse serious respect, helped him save some client relationships.
50% of Something is Better than 100% of Nothing
Back in college, a fellow student would see someone attractive pass by and say, “She’s not my type.” Curiously, I asked “What is your type?” He replied, “It doesn’t matter. My type won’t speak to me!” The expression “you’re not my type” often applies, too, in the financial services industry.
Sometimes accounts get reassigned when an advisor leaves the firm. In some cases, the client stays because they are loyal to the firm, not that specific advisor. Let’s say you are handed some new account reassignments. You call and introduce yourself. Over the next couple of months, you sense that the client relationship isn’t working because you and the client are not connecting. I ran into this problem myself as an advisor.
As advisors, we know our responsibility is to work with and help the client. If we don’t connect on the right level, it is easy to see how the client could fall through the cracks. In such cases, I gave the account to another advisor in my office. It’s great if you get something out of it, like a 50% commission split for a couple of years, but I was happy to simply give the account away. This was before asset-based pricing. An account that did no business was an account generating no revenue. What was I losing?
The Bottom Line
There are many reasons why clients create distance or fall out of touch. Sometimes, being proactive can save the relationship.
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.
