I frequently hear financial advisor war stories which fall into the general category of “I wish I had known,” the premise being a missed opportunity to add value to a client relationship. Sometimes, no matter how hard you try instilling in your clients the importance of keeping you informed of significant life changes, they simply forget.
Most of the time you catch these changes during your regular review meetings, but when you don’t and it results in a client losing money or missing an opportunity you kick yourself. These unfortunate events are out of your control, yet being a true advocate for your clients’ success causes you to say (or at least to think) “I wish I had known.”
Let me quickly share a few stories which all could begin, “I wish I had known…”
…the attorney forgot to “name” the executor:
After an unexpected client death, this advisor learned that her client had changed his attorney and his trust documents without giving her an updated copy. The reason for the changes was not apparent as the advisor had worked closely with the client in recent years overhauling his estate plans, including the old trust. And though the new documents didn’t dramatically alter the advisor’s prior planning, the lawyer’s inadvertent omission of a named executor caused lengthy delays in settling what otherwise should have been an uncomplicated estate.
In this case the advisor was able to retain her deceased client’s assets by catching the attorney’s error and helping the heirs understand their father’s intentions, but it ended up costing everyone involved more aggravation, time and money than was necessary. The advisor concluded, “I wish I had known my client had decided to change his attorney. If we had reviewed the new documents together we would have caught the obvious oversight before it became a problem.”
…the life insurance program had become a problem:
About 5 years ago, this stockbroker introduced her client to an insurance specialist for a review and potential update of a second-to-die policy. Back then, this broker preferred not to handle estate planning business herself. Following the review, a new insurance program was put into place and the client was extremely pleased. For his part, the insurance agent promised at least annual calls to check on the client, but these calls never happened
Unfortunately, this lack of follow-up resulted in the client becoming increasingly dissatisfied with the insurance policy and it was cancelled. Several months later, when the broker learned of this situation during lunch with her client, she felt personally responsible and called the agent to assess the situation. The agent took responsibility for not keeping his commitment to her client, but it was too late to have the policy re-instated.
To make matters worse, life insurance was still necessary to provide the client’s estate with sufficient liquidity and the cost of new insurance is much higher than the prior policy. For her part, the broker now has a new addition to her team who specializes in estate planning, so this time she will keep the business in-house. “Unfortunately,” she remarked, “I wish I had known the client was frustrated, we could have saved him both time and money. This is not the way we like our clients to be treated.”
…my client’s employer was changing retirement plans:
In this situation, the advisor missed the opportunity to capture both the corporate retirement plan and a 7 figure rollover account. Although the advisor admits capturing the 401(k) account may have been a long shot, in this instance the client’s (not to mention the client’s co-workers) personal assets could have been rolled into an IRA. This would have been his client’s preference had he fully understood all the options.
The advisor told me: “My client and I discuss his 401(k) account every time we do a review, but he just didn’t understand his alternatives. When his company decided to change plans, he didn’t think to call me in between our regular quarterly meetings – I wish I had known.”
Have you had similar experiences?
You have probably encountered situations similar to these in your own practice. No matter how hard you try to deliver high level client service and communication, oversights which are beyond your control sometimes occur. The question becomes, how can you help your clients minimize these mistakes and lost opportunities? How do you keep yourself from saying “I wish I had known?”
Here are 3 ideas from past coaching sessions:
- Sometimes a simple phone call is all it takes. In the article, ”6 Good Reasons to Call Your Clients Now”, we give you 6 specific ideas for starting impromptu, yet meaningful discussions with your clients right away.
- On the other hand, you may need to implement a more consistent method for delivering regular client communication. If this is the case, our video, “A Simple Client Communication Strategy”, walks you through an easy to implement process you could put to work this month.
- Finally, if you are conducting annual client reviews our video, ”How to Make Your Client Profiles Count”, offers a specific approach for making the most of these meetings.
The method(s) you choose is up to you, but the key to minimizing “I wish I had known” scenarios is being sure your clients know you are their advocate. From impromptu phone calls to monthly communication strategies to improving your review meetings, you have many opportunities to stay in the forefront of your clients’ minds.