Key Takeaways:

• Large numbers of affluent clients are actively looking for new advisors or are open to switching their advisors.
• Offering prospective clients a second-opinion service can be a great way to build your business right now.
• When seeking referrals, don’t ask if a client knows someone—ask for the name of a specific person they know.

FACE THE FACTS

Typically, only about 7% or 8% of affluent clients are looking to switch advisors in any given year. But when CEG Insights recently surveyed more than 1200 investors with at least $1 million in investable assets, what they discovered should be a wake-up call for all advisors.

• 14% of investors with $5 million to $10 million are actively motivated to replace their primary advisor.
• Among investors with $10 million to $25 million, that percentage soars to 22%

But those numbers don’t tell the whole story. Add in the percentage of clients who are feeling “neutral” about switching—that is, they’re open to firing their primary advisor if they came across a better one—and you end up with:

• 18% of clients with $5 million to $10 million are looking to switch advisors/are open to switching.
• A whopping 38% of advisors’ wealthiest clients are looking to switch/are open to switching.

INSIGHTS INTO ACTION

The upshot: This is what opportunity looks like. You can attract large numbers of affluent clients who are already inclined to work with you—if, that is, you can deliver the exceptional experience that high-net-worth clients want.

The key is to be proactive with your clients and the other professionals you work with who are instrumental to your success (such as accountants, attorneys and other centers of influence). Ask for referrals—or, even better, offer a complementary second-opinion service to friends, family and associates of your clients and COIs.

With a second opinion, you will assess the person’s current financial picture and the advice they’re getting. If they’re in good shape, you’ll say so and recommend no changes. If they’re not, you will determine if you’re the best advisor to help them get on the right track. Your framing here is that you want to offer value and leadership to people your clients/COIs care about who are concerned or feeling uncertain in today’s environment.

There are three ways to approach a referral “ask” or a second-opinion offer—but only one is the superior approach.

1. Awareness. You let clients/COIs now that in this time of uncertainty you’re offering second opinions to people they care about. This makes them aware. But awareness if rarely ever enough to drive action. You need to go further.

2. “Do you know anyone?” You ask clients/COIs if they know of anyone who they think would benefit from talking with you and getting a second opinion on their financial situation. The trouble with this approach is that you’re asking a yes or no question—and it’s very easy for the person to simply say that no, nobody comes to mind.

3. “Who do you know?” This is the most effective approach, by far. You might say something like “I’m sure you know someone who is feeling uncertain these days. Who do you know who would benefit from sitting down with me and getting a second opinion?” When you do this, you’re not asking them a yes/no question—you set the table for a specific response and the name of at least one person to reach out to.

The research reveals that affluent investors today aren’t getting what they need from their advisors and are more than ready to work with you. Don’t sit this one out. Be proactive, offer your services and play to win. If you do, your business could be substantially bigger and better in the coming years.

SCHEDULE YOUR FREE PLAY TO WIN CONSULTATION NOW

PREFER AUDIO?