Advisors often work with high-net-worth clients and can understand their expectations when it comes to managing their finances. The good news is that some of these points are applicable to non-wealthy customers as well.
Read this article to learn four lessons advisors can learn from their high-net-worth clients and how they can be applied to any client.
If you're looking to grow your financial advisory business, check out SmartAsset's SmartAdvisor platform.
Almost everyone needs an estate plan
Estate planning practices apply to all clients, regardless of tax bracket, says Renee Fry, co-founder and CEO of Gentleo, a company that provides estate planning document services.
“Financial advisors should apply estate planning principles to all clients, regardless of income bracket, using high-net-worth clients as an example,” Frye says. “Everyone has wealth, regardless of their income level. Therefore, everyone should have a plan in place to ensure that their assets are distributed according to their wishes.”
Proper planning helps advisors build a larger client base. “In doing so, advisors can ensure their clients' financial security, build long-term trust, and differentiate themselves from their competitors,” Fry says.
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Even when the client has the knowledge, outside advice is valuable
Some of your clients may be business tycoons or professional executives who benefit financially. “But that doesn't mean you know how to budget, how much to insure, how to invest, or how to use your assets, whether it's property or philanthropy,” says certified financial planner and founder Amy Jo Lorber. To tell. Dr. Lauber Financial Planning.
Lauber also notes that non-wealthy customers, especially those looking to improve their financial situation, are often more financially conscious than their more affluent counterparts.
“People who are living paycheck to paycheck seem to be more aware of their finances, because they have to be,” Lauber says.
Index funds can be the basis of a client's portfolio
“You don't have to have millions of dollars to own the top 500 stocks in the U.S.,” said Stephen Maggard, CFP at Abacus Planning Group. “He invests $1,000 in an index fund that tracks the S&P 500, and that money is distributed among the 500 largest publicly traded companies in the United States. And it costs nothing to do it.”
Maggard says non-wealthy clients have the opportunity to take advantage of index funds, which have affordable expense ratios. “These funds are a great way to capture market returns without paying a fortune.”
Combining money and financial planning is powerful
“The lesson that HNWI clients can teach all of their clients is that money can't buy happiness. But financial planning is necessary,” says James Parks, CFP of Parks Wealth Management. .
For high-net-worth individuals, failure to combine multi-million dollar assets with proper financial planning can lead to problems. The lesson is the same for those who don't have much money.
“Create a financial plan and stick to it to achieve your goals and dreams,” says Parks. “Make a budget for things like fun travel plans, retirement income, and college funds. And instead of watching your portfolio reach some arbitrary number, spend your time doing activities you enjoy.” Sho.”
conclusion
Advisors work with a variety of clients, from high-net-worth clients to those with average incomes. Despite the difference in bank account size, regular clients can benefit from some of the same strategies that advisors implement with their high-net-worth clients.
Financial Advisory Tips to Grow Your Business
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We will be your organic growth partner. If you're looking to grow your financial advisory business, check out SmartAsset's SmartAdvisor platform. We match certified financial advisors with qualified clients across the United States.
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Please increase the radius. A recent study from SmartAsset shows that many advisors expect to continue meeting with clients remotely during the COVID-19 outbreak. Consider broadening your search and working with investors who are comfortable holding virtual meetings or spacing out in-person meetings.
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