What Clients Want to Know: Questions a Wealth Manager Should be Prepared to Answer to Win New Business

Well-prepared clients looking for a new financial planner or wealth manager have good questions - and here's how to have good answers.
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by Jodi Taylor on April 16, 2018

A new client looking to switch wealth managers or has never worked with a wealth manager or financial planner before is naturally going to be hesitant about handing over control of their financial future.

Most importantly, the client is going to want to establish trust and be sure that their new planner is going to make the right decisions for their finances. They’ll want to know that you have their best interests at heart.

As their Financial Planner or Wealth Manager, it is your role to evaluate and help plan for the future of their finances, investments and estate planning.  After answering their questions, getting an understanding of their current financial standing and listening to their short and long term goals, the objective is to be able to prove that you’re trustworthy, motivated and savvy enough to develop a comprehensive and unique financial plan that will benefit their financial growth.

You should anticipate a new client’s concerns, and be prepared to answer a multitude of questions. Below are five important questions you should expect a new client to ask and possible answers.

  1. Are you a Fiduciary?

First time clients may have never even heard the term ‘Fiduciary’, however, if they’ve done their research, they should know that it’s one of the most important questions to ask before entrusting their financial well being.

It will be important for a potential client to understand if you have a legal and ethical obligation to make decisions in their best interest, and that you’re not simply working towards achieving an aggressive commission goal.

Being able to tell a client you’re a Fiduciary will likely be a significant step in securing their business, however, if you are not a Fiduciary, you may want to delegate Fiduciary responsibility to someone you know or work with who is a Fiduciary in order not to keep clients that are looking for that added security.

In another Xtiva post, Product Analyst, Steve Boe goes further in depth to explain the current state of the Department of Labor’s Fiduciary Rule, the legal controversies surrounding it, and what to expect in the coming year as the courts come to conclusions.

  1. Can you tell me about your previous experience and success with other clients?

Your client will essentially be interviewing you to see if you’re the best person for their personal wealth management decisions. In order to build credibility and trust, you should be able and ready to talk about your personal investment philosophy, why you think it works, and positive results you’ve achieved for previous clients.

According to an article written by Nellie Huang for Kiplinger, there are many key credentials to discuss when trying to win over new business. An informed client will be looking for a clean record, meaning that you haven’t had any dealings with regulators of the law or had any disciplinary action taken against you or your firm.

A new client may also ask about certifications and licenses that, if you have acquired, you should mention to establish your expertise. A CEP, CFA, or CPA all define your different levels or years of experience, specific standardized testing you’ve passed, and ultimately help to prove that you’ve put in the time to be qualified as an expert in wealth management.

In addition to certifications, there is a good chance that a new client will want to speak with references from existing or previous clients. Ideally, you should provide them with references to clients who have had similar financial goals and portfolios.

A trusted advisor is the kind of advisor clients can trust, so it is important to be prepared to discuss your philosophies, experience, and credentials. Putting time into securing reliable references will go a long way with building a new client’s confidence in your abilities to execute.

  1. What are all the services you provide and the cost breakdown?

The goal of hiring a Financial Planner or Wealth Manager is to enhance or fix your existing and future financial situation. You or your firm may offer several standard products and services, some higher risk than others. It’s essential to understand the level of risk your client feels comfortable with before explaining all potential offerings in depth and their costs.

The most commonly offered services will likely be personalized financial planning, retirement planning, lending solutions, investment services, estate planning and wealth transfer, among others. The cost of any of these services will likely depend on the comprehensive plan you and your client put together, but it is in your best interest to be prepared to explain each service, the logic behind the projected cost, prove the value, and most importantly explain how the fees associated with each product are determined. The more detail and the more fluent you are in explaining services and their corresponding costs and fees, the more trustworthiness you’ll be able to attain.  

The website MyPrivateBanking even put together this article on understanding cost drivers and pricing models in wealth management in order to cut costs, expand services, and get more business.

  1. What tech are you using to manage my money/portfolio?

With the Fintech industry booming, the growing mainstream popularity of Cryptocurrency, and Personal DIY Investment Portfolio Platforms popping up everyday, it is imperative to stay ahead of the game, and be able to introduce and explain the unique technology you or your firm is utilizing to aggregate data, measure results and how you use it drive ROI. WealthManagement put together a nice primer here for advisors. 

As a Financial Planner or Wealth Manager, you must be able to not only prove that whatever technology you’re using to manage accounts, analyze data and read statistics is trustworthy and safe, you must be able to also sell the value you provide with a personalized, human relationship the client will have with you.

In another blog post by Xtiva, Chief Product and Strategy Officer, Jeff Marsden lays out the “Top Reads: Tech and the Future of Wealth Management”. As a Financial Planner, you should know the ins and outs of the technology platforms being used throughout your industry and that you use yourself, and be able to speak fluently about their capabilities.

  1. Why should I choose to hire you?

Lastly, when winning new business, it is crucial to show that you’ve been listening, taking notes, and have a solid understanding of clients’ short and long term goals for the future of their wealth. You want them to leave feeling like they’re going to be a top priority for you, so being specific when making informed, customized suggestions for their financial plan will be imperative.

Highlight your strengths, your previous successes, have your certifications on display and provide references. Emphasize your availability and willingness to engage in check ins and direct back and forth communication. Be confident, and most importantly, use your time to prove that their money is safe with you and that this will be a collaborative partnership.