It's Friday morning and Wendy Playfair, a certified financial planner with Freedom 55 Financial in Mississauga, Ont., is working out of her home office. It's her administration and paperwork day, and she's got reams to wade through.
After eight years in management, she recently moved back to the sales side of the financial planning industry, servicing clients and selling insurance. Ms. Playfair was lured after deciding to join forces with another adviser who was trying to tackle a large client base partially cobbled together from the lists of retired advisers. Think thousands of accounts.
Now she's making calls, meeting people and trying to bring the number down to a more manageable level.
"I'm hitting the road hard," she says. "I'm out there seeing anybody and everybody, even if they have a $5,000 RSP with us. I want to determine if there's value in keeping the relationship."
For many financial advisers, it pays to periodically consider how many clients are on the roster. It's about finding the sweet spot: If you have too few clients you can't pay the bills, and if you have too many you can forget about giving customers the level of service they deserve.
"We want to make the business functional so we can actually do a good job. Ultimately, the moment you realize you cannot speak to 80 per cent of your clients during the course of a year, you've got too many," Ms. Playfair says.
Yet settling on that perfect, Goldilocks-approved number is not a simple exercise.
According to Andrew Guilfoyle, an adviser with Guilfoyle Financial in Toronto, the right number depends on two things: how many people are working on the financial team and how needy the clients are. Clients with complex businesses or those with multi-generational components take up more of an adviser's time.
Meanwhile, an adviser with a large team of junior advisers and administrative helpers can rack up numbers and manage those clients (or at least have an underling do it). Just consider financial adviser wunderkind Peter Mallouk of the United States, who is reported to manage roughly $12-billion for 8,000 affluent clients. You know he's not going it alone.
While Mr. Mallouk's story is extreme, being one voice in a large pool of clients may have an upside.
"Intuitively, people think that less is more, but no one wants to be your only client. They want you to have the experience dealing with a variety of situations," Mr. Guilfoyle says. "They want you to have a thriving business because it allows you to invest in quality people who can give the best possible advice."
Many of today's financial planning clients are also looking for more services, all under one roof. They want estate planning, tax planning, tax strategies and postsecondary education planning for the kids. No wonder some firms build a large external network of accountants and lawyers to help.
Léony deGraaf, a certified financial planner in Burlington, Ont., who works with many elderly clients, doesn't have dozens of colleagues in her office to lean on, but she says she's less likely to limit the number of clients she serves, for philosophical reasons. She has about 200 accounts on her list.
"Limit your client book to only 50 clients and it becomes a financial world of haves and have-nots," she says, explaining that an adviser with only 50 clients would require each one to have about $5-million of investable assets to make it worth their while. "Personally, I believe that all clients of all account sizes deserve financial advice."
At the same time, trying to take on anyone and everyone doesn't work either, although Ms. Playfair says she has seen advisers – particularly those starting out – do just that.
"It's a hoarding game for some," she says. "But they don't look any better if they have thousands of clients because people start to wonder, 'When will you have time to talk to me?'"
Ultimately, limiting client numbers is not a common practice among Canada's 80,000-odd financial advisers and planners, says Joe Ruddell, managing partner at First Prairie Financial Inc., in Edmonton. Most are just happy to find customers and build their business.
"Limiting is a very unique business model here in Canada," he says.
Don't want to be a number? Ask these questions first
"How many clients do you have?" Don't be shy. Believe it or not, all the advisers interviewed for this story said they would tell a prospective client the truth if they were asked. Makes sense. If you're looking for A-plus service and they offer only discount goods for the masses, it's better for everyone to know that up front.
"What kind of clients do you have?" Couples in their fifties owning complex businesses and with an eye on retirement will generally need more handholding than a 30-something single. If advisers have too many high-touch customers, they might be overwhelmed unless they have the proper support.
"How accessible are you?" If it takes advisers a week to get back to you with the answer to a simple question, it's likely they're in over their heads, client-wise.