4 ways to increase your income in 2022, without new clients

Most advisers that I’m talking to have had another strong year in 2021. You’ve attracted some new clients, your existing clients have needed reviews and sometimes revised product solutions to reflect their changed circumstances, and markets have performed well again in 2021 resulting in increased trail income.

But it’s not all one way traffic… I’m hearing many stories of processes taking longer than they should because of service challenges with some providers, an ongoing struggle to retain and recruit the right staff and clients requiring more of your time. Some of you are creaking at the seams a bit and working flat out. Taking on new clients in a real challenge now.

So where does this leave you for 2022? Service issues will continue, the demand for good people is only increasing and who knows, but markets may not continue their steep upwards trajectory. If you won’t have room for new clients, how are you supposed to continue to grow your income in 2022? Here are a few thoughts.


1. Review the services you offer

It always come back to your proposition and what you offer to clients… Business usually goes a little client from mid-December to mid-January. Use this time wisely. Are there more valuable services that you could offer, which would allow you charge more? Or are you delivering the right services to your customers, but they are simply not aware of them as a result of poor communication by you? If you can improve your proposition and your clients’ knowledge and engagement with it, can you deliver additional services, charge more and comfortably justify doing so?

I suggest you take some time out to review your proposition and how you are communicating it. You may be pleasantly surprised when you actually visualise the depth of services that you offer and the value that you are adding.


2. Attract all of the client’s assets

Financial advisers often tell me of the frustrating situation in which they are only managing a portion of a client’s assets. I just don’t really get this one to be honest… Yes I can understand that a client may think they are better off having a few advisers and not having all of their eggs in one basket. However, isn’t it the adviser’s job to manage the diversification challenge on behalf of the client?

This situation sometimes arises as a result of an adviser having been happy to simply get a new client on board, even when they are only getting a portion of the client’s overall assets. But how can you advise the client properly when you are only partially informed? Surely this situation can result in a completely misaligned portfolio? And this often completely undermines the future cashflow planning, which is rendered pretty meaningless if you don’t have full visibility. Even if you don’t manage the assets, you need full information about them.

Work on your script with clients where you know or suspect you are only advising on a portion of their assets. Your client needs to be crystal clear about the disadvantages of you not having full visibility of all assets.


3. Cross-selling opportunities are important for you and your clients

Sometimes it’s easier for an adviser to position her/himself as an investment specialist or a retirement practitioner. But then the adviser can be a little reluctant to step outside of his or her specialist knowledge zone and advise in other important areas such as protection etc. Too often I hear, “I don’t really do much protection / investment / pensions” – this is usually down to the confidence of the adviser in delivering in these areas as opposed to the profile of your clients.

Yes of course you need to be confident in your capability to provide excellent advice in these other areas, but this is not really a stretch for many advisers – it just might be down to working on increasing your knowledge. And it does not undermine your positioning as an expert in your main area of specialisation. Clients should expect and will be grateful that you are watching their back in these other critically important areas too.


4. Increase your rates

When did you last actually review your advice rates? I see enormous disparity between rates charged (particularly ongoing trail) by different advisers, often when there is little or no difference in their propositions.

Sometimes it’s a case of one adviser having set their rates ten years ago when the economy was on the floor, and not having revised these rates since then, while the other adviser set their rates in recent years when the economy was on a steady growth path. So is it time for you to look again at those rates you are charging – are you selling yourself short for the value that you’re delivering? This starts back though with your proposition – is this good enough to justify higher levels of trail?

I wrote recently on this topic – have a look here for some thoughts on increasing your rates.

These are just a few ways in which you can look to increase your income in 2022. The next step is to do some more detailed planning around each of them. The very best of luck.




Take out earnings or re-invest?

Like many of your peers, I hope you’ve had a strong business year in 2021. If so, hopefully that leaves you with the enviable situation of having to decide what to do with the surplus cash in your business.

While I’m certainly no accountant and the views of your own accountant should certainly be sought, here are a few thoughts to consider yourself.


Live for today

There are many factors to consider, if you are thinking of taking the surplus cash out of the business for your own personal use. Of course, central to this is the high level of tax that will inevitably be due.

But at the same time, maybe a bit of surplus personal cash is needed. Some advisers take quite small salaries and don’t have a lot of personal wealth outside of their business. Maybe you’ve been working extremely hard through the pandemic and extra cash for a well-earned high quality family holiday, or some other big purchase is exactly what’s needed! This could be a catalyst to re-energise you to drive forwards with renewed enthusiasm.

Of course, your own personal circumstances will dictate here. How badly do you need extra cash? It often doesn’t make sense to take cash out, unless you have a definite need for it, as this may simply rule out better options at a later stage. If cash is needed and is available – well great! If not needed, maybe look at other options.


Live for tomorrow

I certainly am not going to attempt to advise you about the value of structured retirement planning and the tax advantage of pensions! Enough said…


Leave it as part of tax planning

Alongside your pension planning, there are other ways of extracting wealth from your business, mainly through Retirement Relief or Entrepreneur Relief. These are routes that need careful planning, well in advance of your desired exit date. Leaving cash in the business may give you more options to maximise your opportunities available under these tax reliefs.

You also have the added benefit of a cash buffer within the business, should you experience an unexpected shock to your revenue. This could be very important in the event of a sudden economic downturn, a sharp fall in investment markets impacting your trail income, an illness to you or another key revenue generator in the business or some other cause.


Re-invest to increase the value of your business

Of course the other route to consider is to use the surplus resources to increase the long-term value of your business. There are several different areas that warrant careful examination, to determine if they’ll help you grow.


Spend money to grow your revenue: Money spent on refining and improving your client proposition that will enable you to charge more or meet the needs of a wider range of clients will be money well spent. Alongside this, money spent on improving and raising awareness of your brand in key target markets through social media activity, advertising, PR and sponsorships warrants consideration. This can be further augmented with a structured approach to marketing your business, with the objectives of attracting new, profitable clients and deepening relationships with your existing clients.


Grow your advice team: If you have surplus money in the business, it’s worth considering the benefits of adding another adviser to your team. Of course there are many factors to consider here such as the balance of your team, how an additional person will affect the culture of your business (they hopefully will improve it!), the ability to service increased numbers of clients, reward structures and whether the marginal profit increase is actually worth it.


Spend on capital improvements: Does money need to be spent to improve the working environment of the team, that will lead to higher productivity? Or is it worth considering spending money on the public areas of your office to improve the client experience when they visit? With the explosion of remote working and client meetings, money may be well spent on your technology solutions to improve both the productivity of your people and also the experience of clients for online meetings. There is nothing more off-putting for a client than talking to an adviser with a poor camera, microphone or surroundings.


Grow through acquisition: While at the moment there appears to be more buyers than sellers, opportunities arise to purchase other advice businesses or indeed books of business. Having a war chest ready to go could just give you the edge in terms of ability to go a quick deal. Of course, being above to make an acquisition with no / less debt or external investment keeps the ownership in your hands too.


With extra cash in your business, it comes down to the desire for instant gratification (take cash out), extract it for your own future wealth (through pensions) or retain it in the business for tax planning or business growth. Each have their merits and deserve careful consideration.