What clients really want

Of the following, what do you think clients said they personally require the most from their advisors in our company’s client survey.

A) Information on financial markets.

B) Research/updates on specific investments.

C) An investment policy statement.

D) None of the above.

The answer is (D). In fact, the best showing from the list above was “Information on financial markets” which came in at #5, with only a quarter of respondents (24%) saying this was one of their top requirements.

If more information about investments isn’t one of the top requests, what are clients saying they require the most?

#1. A periodic / annual review of my plans or accounts (67%)

When we were meeting with them in February 2009, clients already knew that their investments were down so we didn’t need to revisit the devastation caused by the markets. More important to them was how far their retirement date was going to be pushed back and whether they were still going to be able to cover their children’s tuition.

To meet the needs of our clients, we developed the Client Dashboard. The dashboard allows us to show clients where they stand with respect to all their financial and life goals. More importantly, with each goal we list specific actions they could act on such as investing more / spending less to speed up the process of getting back on track.

Creating the Client Dashboard was one of the best investments we made in our practice because it now allows us to provide a complete financial plan review on one piece of paper, which coincidentally, is the Number One client requirement. Feedback from clients has been great.

#2. Retirement / Lifestyle plan (45%)

We ask new clients to bring a copy of their financial plan with them to our first meeting, but over the years, we’ve yet to ever see one. Retirement planning is a win-win scenario because it’s what clients are asking for and since few advisors provide the service, it’s a great way to differentiate yourself from the competition.

Defined benefit pensions are almost extinct which means the onus will be on the individual to plan for their own retirement. This is where financial planners can help create comprehensive, easy to understand plans.

Focusing on lifestyle planning is how we have grown our practice. We offer Life Goals Planning Seminars. and encourage attendees to start thinking about what they want to accomplish and where they want to be in 10 years. Then, we help them understand that our job will be to create the financial plan that will get them there.

#3. Cash flow / income planning (33%)

Cash flow is something we’ve been preaching for years. We have always maintained clients want it but we’ve never had proof to back up our claim until now. One third of clients surveyed said help with cash flow planning was a major requirement.

Within a financial plan we make many recommendations and the reality is most of those recommendations cost money. The money has to come from somewhere and cash flow planning is the process of helping clients understand how to manage the money that comes in and the money that goes out, so they can afford their goals and priorities.

Whether it’s opening a high interest savings account to set aside money each pay for property taxes or putting $400/month of cash in an envelope marked “Entertainment”, rolling up our sleeves and creating a offer personalized cashflow plan. for clients is what clients want.

#4. A formal written financial plan (31%)

Rounding up the top client requirements was having a written financial plan. I’m sure there is a scientific report somewhere that proves why writing things down increases the likelihood of a goal being achieved but I’m comfortable just going on experience.

When clients have a written list of their goals and the steps they need to take to achieve those goals – in other words when they have a written financial plan – they seem more motivated to do what it takes to make it all happen. Our role is to help them understand each step and to hold them accountable at review meetings on the work that needs to be done to get there.

Investments are extremely important but most of the time should be spent by us, researching and tracking investments behind the scenes on behalf of our clients. For the few precious hours our clients can find to meet with us throughout the year, let’s spend more time on what they’re telling us they really want help with.

Source: ‘AdvisorPractice Survey’, 2009; n=1,537; Margin of error is +/- 3.0%, 19 times out of 20.

Mathieu Paradis, B.Comm., CFP, CLU, FMA is co-founder of AdvisorPractice.com which offers advisors practical solutions to transition to a financial planning practice and offers a 12-week training program. He is a financial advisor and offers his clients comprehensive life goals financial plans.