How to show clients you're on their side - Advisors

How to Show Clients You’re on Their Side

BY John Easton, Director of Wealth Management
March 22, 2017

It’s safe to assume that most advisors act in the best interest of their clients. After all when your client benefits from your advice and planning, it’s a reflection on you and your business - you may even benefit in some referrals. However in the wake of a recent scandal involving one of Canada’s largest banks and allegations of aggressive and at times misleading sales tactics, trust in advisors is diminishing - which means it has never been more important to show your clients that you’re acting in their best interests.

The aim of this latest post isn’t to tell you how to manage your clients, nobody knows how to do this better than yourself, but what we do want to show is how you can take a few proactive steps so that your clients know that everything you do with their hard earned money isn’t in self-interest.

Be transparent

The implementation of CRM2 is pretty much forcing the hand of advisors to disclose just how much they charge in fees, and by now most advisors will have already provided their first CRM2 compliant reports. While your report might be CRM2 compliant the chances are the average client isn’t going to know what the numbers mean. This is where taking the time to develop either an easy to read report or going through it with your clients on a one-to-one basis is going be to the benefit of both parties.

Manage expectations

This is a little more ambiguous, but some clients start looking for financial advice and investing on the assumption that it’s a quick way to make money - either that or their portfolio is only ever going to go one way and that’s up. Setting out from the start of the client/advisor relationship that markets go up and down and being realistic with their predicted returns can help soften the blow when things do go wrong. This way the client can rest easy knowing that they haven’t lost money as a result of dishonesty.

If it’s an existing client you’re dealing with and things start to go sour, being proactive and reaching out to them is key rather than them making assumptions that you sold them the wrong product. If they’re not receptive to a realistic approach, it might be the client isn’t right for you, which isn’t an entirely impossible scenario.

Be honest when things go wrong

Mistakes can happen, it’s part of everyday life. But how you handle these mistakes can either make or break a client/advisor relationship. If it’s a mistake that you’ve made on your part, whether through an incorrect recommendation or an administrative error, be upfront and honest - rather that than have your client assume that you’re profiting out of them losing money.
When it comes to showing your clients that your advice and actions is in their best interest, it pays to follow the mantra that ‘honesty is the best policy’. If you act like you have something to hide, or clients feel that you’re trying to deliberately be vague, chances are they’ll go elsewhere, especially in the changing competitive landscape facing advisors today.

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