As more and more advisers shift the focus in their client interactions away from products and more towards a broader and more valuable financial planning proposition, the profile of their income is also shifting from a reliance on initial commissions to a flatter and ultimately more valuable ongoing income stream. To justify this recurring income stream, regular review meetings with clients are becoming far more important events.
It’s not too long ago that I used to wince when hearing about the review meetings of some advisers, where the client opting not to have a meeting was seen as a victory. The review meetings of these advisers were haphazard and added little value to clients. Thankfully these are mostly in the past.
One of the challenges for advisers is that they hear so much about the importance of developing an engaging Client Value Proposition. As a result, a lot of time and effort has gone into identifying where clients are experiencing value, the advice process that is being used, the client services that are provided and indeed how all of this should be paid for by clients. This is great, but the focus tends to be around the initial (year 1) engagement with clients.
I can tell you as the client of a financial planner that I can’t at this stage remember our initial interaction. But I remember clearly our last review meeting, and I’m also very clear about what we will discuss at our next meeting. And that’s the way it should be. The initial advice stage set me off on the right path; the review meetings keep me on it.
With some advisers, the focus is heavily weighted on attracting new clients, at the expense of minding the existing ones. However having a brilliant review meeting is the means by which you’ll lock in those clients year after year, and as a result enjoy an ongoing income stream from the clients.
As a core part of your initial engagement with a new client, it makes sense to explain to them in detail what will happen every year into the future. It’s not enough for review meetings to be positioned as a “by the way” 10-second conversation at the end of the initial product implementation.
What should a review meeting include? Of course the financial plan should be central to the meeting – have the client’s life goals changed, do they want to explore a different future? Have they the financial capacity to live the life they want? There is also the fairly standard (and necessary) tasks of reviewing a client’s portfolio, getting up to date values and potentially even writing a short review report. And you definitely should explore further protection needs based on changing circumstances etc.
However the real opportunity to demonstrate your value on an ongoing basis to clients rests outside of the traditional review meeting agenda. Why not take a little extra time and set out for your clients some financial benefits that you’ve delivered to them such as;
- Their wealth growth.
- Their improved future capability to live the life they want.
- The growth in actual euros of their investment portfolio.
- The tax saved as a result of their pension plan and any other tax efficient policies in actual euros.
- The actual money saved in euros as a result of a protection review you carried out previously.
Now your ongoing fee / trail commission starts to look very small! However there’s still a lot more you can do at these review meetings to demonstrate further value to you clients.
- Help your clients with their household budgeting. This is an area that many clients continue to struggle with. By getting clients on the right path here and reviewing it with them, you can add enormous value to them.
- Reviewing future cashflow plans with your clients each year adds tremendous value. This can completely change the conversation, enable you to look at “what if” scenarios and approach the client’s financial affairs in a very engaging and collaborative way.
- Talk to them about their broader financial needs where you don’t provide the solutions. You can add value by tapping them into your network of solicitors (for their will or enduring power of attorney), tax advisers (tax advice) or accountants. Now you’re the person centred right at the hub of their financial affairs.
Review meetings are also the opportunity to remind your clients of the work and interactions you’ve had with them throughout the year – the rebalancing of their portfolio that you carried out, the interim meetings you had, seminars you invited them to, the content you sent them etc. How can a client question your ongoing fees when they realise that you are actually providing value to them right throughout the year?
So place review meetings at the heart of your proposition. Make them memorable and ensure your clients come back to you year after year.