Identifying the Ideal Financial Advice Client – Part 3…

The third element of identifying an ideal advice client is whether or not your firm can add value to their financial lives.

Provided your client does not need to win lotto to make their financial dreams come true, this attribute of an ideal advice client, like the second attribute, initially appears easy to identify.

Don’t be fooled.

Remember the client also needs to share your enthusiasm and confidence you can add value. And if you’re hoping to continue to earn on-going advice fees, your firm has to confidently add value year in year out.

What is the value you need to add?

I find it easier to talk about what it isn’t.  

For advice clients, adding value isn’t ‘being cheaper’. This is treating advice as a product and is dangerous ground for most of our clients. It’s not an advice proposition.

I’ve never heard of a surgeon who regularly wins her work from referring doctors because she is the cheapest. Being cheap is certainly adding value IF you’re in the business of selling advice products. But providing advice relationships? I’m not so sure.

For advice clients, adding value isn’t ‘beating the market’.

This is certainly a strong and valuable proposition for purchasers of investment products, but is not the first criteria for adding value when purchasing advice relationships. Good financial advice needs good financial products just like good surgeons need sharp scalpels.

But these are a given. Aren’t they?

If you are in the business of building an advice business that earns long-term fees from advice-paying clients, pegging your success to having the ‘sharpest’ scalpels (i.e. financial products) confuses and mis-educates your client. If you believe the value you add is primarily determined by the quality of scalpel, are you in the business of delivering relationship-based financial advice or in the business of delivering product-based financial advice?

For advice clients determining whether you can add value or not is more than just ‘being there’. I often hear “my clients pay us because we’re there for them when needed…”.


But petrol stations used to do a pretty good job of ‘bring there’ until they were revolutionised by the major grocery chains.

Being there is not enough when identifying how your firm adds value to advice clients.

Thanks to the efforts of great advisory firms setting great advice standards, thanks to Future of Financial Advice, thanks to the new impending financial standard championed by the Accountants Standards Board (APES230), thanks to the global financial crisis, what used to mean ‘adding value’ and will mean ‘adding value’ is fundamentally changing.

In essence, adding value is delivering upon the intangible skills of advice not only the tangible skills. It’s your firms client management ability, project management ability, strategic management skills, leadership, direction, professional relationship expertise.

Determining if your firm can add value to each advice client every year is tough.

True advice firms will become increasingly more identifiable as they themselves become more proficient at identifying clients seeking on-going relationships to live better financial lives. What ‘adding value’ means will ultimately be best determined by our advice clients.

What do you think?

Remember the previous two traits? Here’s the first, the second.

Ready for the final two traits? Here’s the fourth and finally, the fifth.


About Jim Stackpool

For nearly 30 years Jim has influenced, coached, and consulted to advisory firms across Australia. As founder of Certainty Advice Group, he leads a like-minded team of professional advisory firms seeking to create greater certainty for their clients. As an author, blogger, columnist, and keynote speaker, Jim is regularly called upon for his professional insights into the advice industry. His latest book Seeking Certainty is available now.

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