When clients come in for their meetings, begin by updating their basic information, like where they live and work. Do they need to update their risk tolerance profile? Have their goals changed?
Ask if they maintain financial accounts outside of your firm. The reactivation opportunity will apply primarily with clients who have assets available to be transferred. When you identify these clients, educate them about the process you use and why consolidating assets with you will help them. You will be better able to monitor investments and better able to advise them of proper diversification strategies.
At this point, you need to establish trust and spell out the type of service you will provide that, for whatever reason, they may feel they have not received in the past. Once the transfer process is completed, schedule another meeting to review their goals and discuss strategy. Meet with clients you have reactivated on a schedule that you both feel will provide the service they need, initially at a minimum of every six months.
I have seen advisors implement this strategy and generate more than $400,000 of business within two years. But it does take time and effort. Only you can decide if it merits implementation in your practice.
Now let's discuss how to provide more comprehensive service to newly reactivated clients, as well as to A and B clients.
As a financial professional, do you want to:
A) Help people grow their portfolio within their risk tolerance and time frame?
B) Help people make sure they never run out of money?
C) Both of the above?
If your answer is A, then you need to create a menu of services for wealth management. A menu typically means three tiers of service with three different fee structures.
For example, you may have one tier of service using exclusively mutual funds or exchange-traded funds. Another tier may use a turnkey asset management program (TAMP). Another more complex tier may incorporate a combination of funds, stocks, bonds and options.
Consider pricing based on the complexity of the service you provide rather than strictly account size.
If your answer is B, take a look at the financial planning software your firm provides. Does it cover all six areas of financial planning, or is it more of an asset allocation software? If you aren't sure, discuss it with someone at your firm familiar with the software.
Income and expense management, retirement planning, estate planning, tax planning, insurance planning and investment planning should be included in a comprehensive plan. This approach is the most common for helping clients address the issue of running out of money.
If you decide to provide a combination of A and B, that's fine, too. You just need to create a menu of the services you provide and the pricing of each one. To provide comprehensive service, create a tiered service and pricing model. Show your clients an understandable services menu and educate them about the differences. Finally, let them choose the level of service that is right for them.
Todd Colbeck is principal and founder of the
Colbeck Coaching Group, a subsidiary of General Business Center.
If you would like an Excel template for your client segmentation
or reactivation campaign, please send an e-mail to this address.