Financial advisors face competing priorities for their time, whether it’s meeting with clients, reviewing and managing portfolios, or handling the ever-increasing regulatory burden. One area that also requires significant attention is managing their own businesses.
From ensuring that practices have proper levels of staffing, to taking care of those staff members, to focusing on marketing and communications, to increasing the use of technology, there is no shortage of areas for advisors to work on as they build their businesses. That work only increased in 2020 as advisors had to find ways to manage their businesses during an unprecedented lockdown.
Here are 10 articles that focused on practice management concerns in 2020:
As many advisors continue to work remotely, some are making the decision not to return to their offices or renew their leases, making way for entirely new working environments for themselves, their staff and their clients – even after the pandemic subsides. “I’m not going back [to an office building],” says Shayne Stephens, president and family office director at Landmark Advantage Multi Family Wealth Office in Stouffville, Ont. “The cost-benefit of creating a home office is that it’s giving me a 50-per-cent return on the investment from the get-go.”
Advisors are finding creative ways to recognize and reward their teams for the extraordinary efforts they’ve made to keep their businesses running smoothly and addressing clients’ needs during months of unprecedented stress while working away from the office. One advisor has recognized his team members by giving them a monetary reward as well as flexibility and a sense of self-direction in terms of when, where and how they do their work.
Many advisors who still depend on commission-based revenue are looking to make the switch to a fee-based model. Those who have been through the transition say it’s not easy, but it’s worth it. Nicky Trasias, investment and insurance advisor with Essential Wealth Group at Industrial Alliance Securities Inc., in Kitchener, Ont., started moving clients over to fee-based accounts about five years ago. She estimates her team invested at least 20 hours per client.
With many Canadians concerned about the impact of COVID-19 on their businesses and personal finances, some advisors have introduced audio and video content to address investors’ concerns and help them stay focused. This format provides an ideal opportunity for advisors to maintain personal contact and ensure clients are getting information that’s relevant to their situations while they’re being bombarded with information and opinions from many sources.
For many financial advisors, adjusting to life in lockdown has been an uphill battle – one riddled with the challenges of running a business remotely. For others, it has freed up time that would’ve otherwise been devoted to the daily activities of office life, like commuting, preparing bagged lunches and socializing with colleagues. So, for advisors who have found themselves with spare time, it’s worth using it wisely. Experts offer up five ways advisors can sharpen their skills from home.
Cross-selling is one of the simplest, yet most commonly overlooked strategies advisors can use to grow their businesses. Ray Adamson, vice president of insurance solutions at Equisoft Inc. in Toronto, argues in How to Create an Effective Cross-Selling System for Your Practice, an e-book he wrote in 2019, that finding new products and services to sell to existing clients is a far more effective approach than focusing on new clients alone. “The chance you can sell a product to a new customer is about 15 per cent,” the e-book says. “But when you sell to existing clients your odds improve dramatically – to almost 50 per cent.”
LinkedIn has skyrocketed in popularity as a tool for professionals across all industries. And as a growing number of advisors turn to the social media platform to market themselves through their posts and profiles, and some digital-marketing experts say there are a range of tools it contains that remain untapped for finding new clients. Among them is the search function, which can be used to find clients in specific industries, geographic regions and even stages of life. Using LinkedIn’s filter functions and boolean symbols like quotation marks and ampersands, advisors can hunt for people who fit very specific criteria.
Although tax deductions for expenses such as portions of home internet or electricity bills or even mortgage interest payments are nothing new, advisors have rarely utilized these breaks in the past because they did most of their business in offices. However, the pandemic has spawned renewed interest among advisors in the tax benefits that come with working remotely – especially as many plan to leave their offices sitting empty indefinitely.
Technology will be a defining factor for advisors in the year ahead and beyond, says Gregory Smith, managing director, wealth management lead for Canada, at Accenture, adding that most people, especially millennials, are eager for their advisors to be more tech-savvy. Client-facing tools like online investment portals and mobile apps are important, but technology usage should extend further into advisors’ businesses, he argues. It can enhance processes that clients may not see directly, but which will change the level of advice they’re getting.
While few advisors have succession plans for themselves, even fewer consider continuity plans for their assistants and other valued team members. Although Robyn Thompson, president and certified financial planner at Castlemark Wealth Management Inc. in Toronto, knew of her assistant’s retirement plans well in advance, but that didn’t make the transition any easier. “Whenever you lose a key member of the team, it’s difficult,” she says. “She had direct relationships with clients for such a long period of time and that’s not really something that can be replaced.”