As you get to know me and True Measure more you’ll find that I challenge and even disagree with some of our industry standards. I often wonder why we operate and practice the way we do. I find that many financial advisors in the industry have been focusing on the wrong aspects of their business and I’ve also noticed that financial advisors are not necessarily communicating their services and value as well as they could be. I’ve been where you are and only after investing years of self-education and experiences have I found solutions to the same problems you face on a daily basis. It’s my hope to shed light on the areas we could all improve on.
I heard an interesting question the other day from an industry thought leader: why are we the only industry that describes ourselves by how we charge for our services? Think about it, a lawyer bills hourly, with a flat fee, or on contingency. Doctors are paid hourly, with up-front fees, an annual-fee or a retainer, by the insurance company, or privately. We don’t describe doctors as up-front fee doctors and we don’t describe attorneys as flat-fee attorneys. And they certainly don’t describe themselves by their fees. Why not? Because these professionals aren’t focusing on how they’re being compensated. They’ve chosen a business model and are instead focusing on their services and value they bring to those they serve.
I’ve learned through my experience as a wealth manager who provides financial advice, that it’s always important to emphasize our value. A financial advisor’s value is focused around advice, individualized solutions to meet investor’s needs, working for the investor’s best interest, trust, attention, and much more. Our value is not how we charge for our services and I think we’re doing more harm than good by describing ourselves in that regard. The industry describes themselves as fee-only, fee-based, or brokers (commission-based). We’re forgetting to bring the focus back to how valuable we are, the services we provide, and the benefits of having someone to provide advice to clients when they’re faced with challenging decisions throughout their life.
My Challenge for You
My challenge for you this week is to take some time and really think about your value and what you bring to your clients. Your advice is the most valuable service you provide and it’s the service your clients value the most. I challenge you to start describing yourself as advice-based, not by how you charge for your services. Financial advisors provide priceless advice to clients. I would challenge the industry to do the same and focusing less on how they charge for their services and more on how they service their clients.
If you found this article helpful, be sure to check out “80-90% of widows change financial advisors: 3 things you can learn from this.”
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