When a prospective client comes in for her first visit, she usually has an idea of what she wants to accomplish – find a new advisor, get the portfolio in order, make a good return, retire. Something like that. Where she’s in the dark is in how to make good investment decisions, and she probably doesn’t know how she has been making them up till now.  If she had a handle on that, she wouldn’t be coming to see me.  She has likely spent her life investing in a career or caring for a family. In either case, she became an expert at something, just not investing. No shame here. I don’t know anything about music theory, or chiropracty, or engineering, or delivering babies, or whatever she devoted her life to. Since I am a reputable trained professional in my field, she has rightly decided to give me a test drive.

Her portfolio is often simply the result of several poor advisor relationships, some self-doctoring, a little neglect, and a whole lot of happenstance. My best chance of helping her lies in teaching her to become a more sophisticated investor and walking with her down a proven financial planning path. I can never let the cart get before the horse. There is a process.  Her natural inclination may be to unknowingly try to circumvent that process by misdirecting the relationship or asking for things out of order, because that’s how she’s done it in the past. I must break that cycle to really help her. I must stay the course. Step 1, step 2…etc. If I let her fly the plane, we may never get it landed.

Never Make a Proposal

Plenty of prospective clients come through the door looking for a proposal. They say things like, “Why don’t you work up some suggestions for me to consider?” Or, “Before I bring my accounts to you, I want to know what you are going to do with my money.” Honestly, I can’t blame them. They’ve lost money elsewhere, or they’ve been neglected, or they’ve been burned. In any case they’re cautious, and they should be. But, I don’t want to propose something that gets an up or down vote. I want to get hired. Products, proposals, and plans come and go, but I want to be their advisor 10 years from now.

When someone makes a proposal request, I have a standard reply. “The reallocation of your portfolio will be a collegial process that will take several meetings over the next few weeks. We will work together to put your accounts in order. I won’t pat you on the head and send you home while I make all the decisions. We’ll do it together. There will be material for you to review and many discussions that will need to take place concerning your specific goals, investment risks, and product features. I am your coach, but you will be the quarterback, making the final decisions on the field. At the end of this process, you will be pleased with the result.”

The point here is that clients can develop the skills to become good investors, and thereby, good clients. But, you must have a well thought out decision-making track and the willpower and self discipline to keep everyone on the track, the client and yourself.  Quality client relationships take time, invest it.