NextChapter | May 2023
The Best are Getting Better
Big consumer trends create opportunities for alert, informed and nimble players. In every industry and profession. In the world of financial advice, the crucible is retirement planning. The moment of truth for advisory firms is the need to now transition from a low maintenance business of selling products to the highly complex world of retirement.?
Across a wide range of advisory service models, the coverage ratio of client households per advisor is about 150. Manageable scale if the requirements are limited to a few calls a year, maybe an annual meeting – and the occasional financial plan. That model works for the limited needs of a savings and investments practice, with a powerful boost from the bull market.?
For clients entering retirement, advisors become alchemists, juggling longevity planning’s myriad elements of health, income, living transitions, estate and intergenerational planning. And the party grows beyond the “client” to aging parents and adult kids. This operational Rubik’s cube needs many more hands to align.?
But it’s not just “retirement” forcing change on a very comfortable industry.
Are Wealth Managers Really Growing?
Most of today’s wealth management offerings are built for a business that no longer exists and for clients that are moving on (not moving in). Why is that so?
1. For one thing, the products are free.?Investment beta and trading commissions are now free at leading direct providers. So if you aren’t free, what is the value you’re offering for what you charge??
2. That’s important to ask, because a lot of clients say they don’t want advice, or at least they don’t want to pay for it.? Forty-six percent of retirement plan participants in a survey said they don’t have financial advisors and aren’t looking for one.
3. Now let’s look at the clients we do have.?Most of them are unengaged, and that’s because they have multiple financial services providers. And most “clients” (outside small, intimate firms) are really just fractional clients. You’ll see them as whole clients only until they leave you when they’ve started consolidating accounts.
4. “Retirement” will eventually replace “accumulation” as the reason people are turning to you for advice, and that will determine whether your advice is profitable. Twelve thousand Americans are retiring every day. This cohort is providing more than 75% of advice industry profits through 2030.
How the Best Advisors are Getting Better
The best advisors are getting better – by following the changing needs of their best clients. The top 100 wealth management teams ranked by Barron’s increased client assets by an average 10% over 2021 – a strong performance in a challenging environment. But much more impressive is the average revenue gain of 48%.?
New industry data shows that clients want help with complex issues of retirement planning and the implications of longevity. Advisors listening carefully to their clients are adapting – winning new assets and new clients.?
领英推荐
Here are the three big growth ideas – with the underlying “why”, the tactical action steps and the research solidifying the trend….
Planning is Personal – My Family’s Story of Retirement Train Wrecks
I was fortunate to know all of my grandparents and three great-grandparents—and to see all of them battle significant and scary events in their last years. All of my older relatives were tough, independent people who lived on their own as long as they could. Here are their stories of retirement wreckage.
NextChapter Can Help
Introducing Your Yellow Brick Road – An Advisor Growth Program Featuring Protected Income.?
Parting Shot: Make Time to Smell the Flowers
My passion for landscaping is metaphoric – growing, always growing. And Spring delivers big time with the incredible color, fragrance and heartiness of my favorite, the Sir Winston Churchill narcissus. My daughter in the UK says she can grab a bunch at the Notting Hill Farmer’s Market for 5 pounds. If only I could deliver….
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Helping Financial Professionals & Companies Attract More Ideal Clients through More Compelling Value, Referrals, and Introductions -- Consultant, Coach, Speaker and Podcaster
1 年like the way Steve Gresham prefers "The Next Chapter" over the word "Retirment." It's particularly fitting for entrepreneurs and folks (like me) who keep creating new ideas and ways to serve people. Stay tuned for my interview of Steve on my podcast: TopAdvisorPodcast.com
CEO& Founder ,Editor of “ The Sassy”,Advocate for Aging Well and Wealthy,Wellness As A Solution "WaaS"?/ Credit Union Evangelist , Driver of revenue by partnering with innovative technology providers.
1 年In short this is an amazing newsletter and I truly want to respond to you in document but I realize that this is certainly not the venue intended for that Steve Gresham . I just attended a conference and in short met a gentleman that is building out his solution. To echoe the words of a very wise individual, that being you, I insisted that we built solutions on life and lifestyles that no longer exist. Thank you for all that you do Steve Gresham ! I would welcome the opportunity to elaborate when you can take the time.