The daughter of a long-term pensioner client set up a gym in Ballarat.
A couple of years later, she set up a second.
Last year, she and her partner started a third up the road in Daylesford.
They have been running by the seat of their pants ever since.
Nearly six years of strong cash flow with exciting highs and sleepless lows. Asset poor. Very little superannuation.
For most FUM advisers offering comprehensive advice, these guys don’t, on paper, appear to be a client for whom they can create and sustain a valuable advice relationship.
That’s understandable, considering the first question of traditional comprehensive advisers is how much money prospects have.
Everything else – the proposition, the pricing, the positioning, the decision to engage – follows from that first question.
Advisers become advisers to help clients with their money.
They build their businesses with clients who have money to manage.
Which is understandable if they are purely money specialists, promising to pick the best structures, portfolios, and returns while managing risks and understanding the client’s objectives.
But most advisers are not offering a money specialist proposition.
They’re specialists in financial relationships.
The Ballarat couple needs a specialist in financial relationships as they have created a business with real financial complexity.
These prospects are ubiquitous.
One of my Sydney-based advice clients had another example last week.
We were conducting an advice grid review of her clients.
She had a number of inherited SMSF clients.
She had not had a lot of success scheduling a proper discovery meeting with them. Most of them, in their late-forties, are too busy and can’t see the point.
Her last contact with one of them highlighted the issue.
The husband, a busy music producer, replies to her requests with promises to get together eventually. The one conversation with the wife indicated that she hasn’t any clue about their finances and isn’t the one to talk to.
A perfect prospect for principal advice teams.
Busy clients prioritising everything other than their own priorities.
Another of my clients in Toowoomba was introduced to a lady going through a difficult divorce.
Originally from Tonga, she has an estranged husband who is making settlement discussions difficult.
She also has a recently widowed elderly mother not in the best of health, who, after living in Townsville for fifteen years, now wants to sell up there and move to Toowoomba to be closer to her daughter and granddaughter.
The daughter’s settlement is in mediation.
The widowed mother’s estate is a mess due to some distant relatives.
The granddaughter’s education, stability and mental health are paramount.
Ballarat business owners, busy SMSF couples, and regular families facing forced life transitions do not fit the ideal client profile for today’s financial planning industry, which has been fed on pre- and post-retirees with retirement sums needing management.
All these cases are stuck in real, unresolved complexity that, left alone, will shape their financial lives for years.
That’s the advice client worth having.
Quality, valuable and profitable advice clients are everywhere, not just sitting atop a pile of money.
Unfortunately, the current paradigms of advice continue to isolate those who don’t have a pile of assets but whose hopes, dreams and ambitions are genuinely at risk if nobody helps them work through what’s actually going on.
The usual objections here are practical.
Today’s advice teams are not built for this.
They don’t have a service or a price for a gym owner or a blended, cross generational divorce situation.
The clients can’t afford the advice or have the funds to pay for advice.
Today’s teams are just too busy doing what they’ve always done.
Fair.
But that’s not a reason to walk past the opportunity and test if their future advice models are more like their past, or something potentially more valuable, more profitable, more enduring.
The hard question isn’t which of today’s clients or prospects are suitable for comprehensive advice. Plenty are, hiding in plain sight, underneath or among the obvious ones with high asset balances.
The harder question is whether you and your team are ready to recognise the opportunity to serve them.
Which of your current clients have you quietly written off because they don’t look like your best clients, when the truth is you haven’t yet built the capability to see what’s actually going on for them?