Opportunities Will Fall into Your Lap. What Now?

I don’t have clients anymore.  My business is training and writing articles.  Still, I started life as a financial advisor. I spent 20 years with a wonderful firm before setting out on my own to teach others to do what I did. I practice what I preach, especially when it comes to social prospecting.  Sometimes it pays unexpected dividends.

People ask why I invest so much time sending biweekly e-mails to friends we met on vacation over the years.  Why we do a series of Wednesday to Saturday Zoom calls with other friends.  Why do we put so much effort and money into socializing?  We love it.  It can also pay unexpected dividends, if I was still an advisor.

Example 1: The UK Friends

We met two brothers on a cruise.  Both retired.  It’s fair to say they are in a different economic bracket from us.  Put another way, we don’t spend three months on the World Cruise, a couple of months in Switzerland, another few months on an island off Greece and a few months at home.

Every two weeks we send an e-mail detailing our everyday life during the pandemic.  They write back immediately.  They send funny e-mails too

This morning, their e-mail has an unusual question:  “Thw interest rates are so low we don’t know where to put our cash.  We just haven’t enough shoe boxes to store under the bed.”

Lessons learned:  These are the same folks who know which supermarket loyalty program gives out free morning coffee.  Since they brough up “interest” I’m assuming they work with a major UK bank.  I’m surprised the bank hasn’t assigned a financial advisor to cultivate them and expand the relationship.

Example 2: The Young at Heart Older Couple

We’ve been doing some in person entertaining.  We are careful to social distance.  On Friday night we sat at the same table, six feet away from them.  We have an hour long video call every week too.  It’s fair to say they are financially comfortable.

Over dinner the husband mentioned he was thinking of leaving their financial advisor.  He didn’t understand why they bought the same stocks for his personal account as they bought for his foundation.  He also wondered why they sold stocks he thought were pretty good.  His wife, who uses a different advisor, couldn’t understand how they could buy and sell without asking his permission.

From my point of view, it’s pretty obvious managed money is used in both the personal and foundation accounts.  It’s likely the same manager, since identical stocks were bought and sold in both locations.  That would explain the discretionary nature of the trades.

Lesson learned:  It sounds like his advisor is not keeping in touch.  This is surprising concerning the sums of money involved.

Example 3: When People Talk About Account Fees

Another couple joins us for a Zoom call once a week.  We gave up cocktails on Zoom months ago because I was gaining weight!  One of them mentioned they pay $ 20,000+ a year in fees and wondered why it was so much.  They also had some service complaints.

The obvious answer is to suggest they talk with their advisor.  It’s logical they are using managed money or fee based accounts.  Assuming they pay about 1%, there’s plenty in assets.  Since the DJIA returned almost 24% in 2019, paying 1% doesn’t sound that bad, even if it looks large when expressed in dollars.

Lesson learned:  An account this size with fees at this level is significant for ant advisor.  Clearly, they should be getting more attention.  The advisor should initiate a conversation with the words “This is how we make money…”

The lesson from all three examples is the same.  When you prove yourself to be a good friend and don’t push business, your friends initiate the conversation and ask your advice.

Related: Eight Opportunities to Ask Your Client for More Money