What Putting the Client First in Practical Terms Means

Consider Yourself Last

You don’t need to be a math major.  Suppose an advisor’s clients have the majority of their assets in fee-based accounts. A large amount is in equities. If the market declines 30%, it stands to reason the advisor’s annual income would also decline by a similar amount.  Not all the client’s assets are all in equities, but you see the point.  Advisors will be hurting.  What should you do?

One of those unwritten codes of British gentleman is said to be: “Consider yourself last.”  It’s not original.  They probably picked it up from Philippians 2:3, which reads: “Do nothing from selfish ambition or conceit, but in humility count others more significant than yourselves.”  I’m assuming the British connection was officers putting the welfare of their troops above their own welfare.

For financial advisors, it means focusing on client’s concerns during the pandemic.  Consider them first.  If a client had $ 100,000 in equities, before and $ 70,000 after, the advisor’s 1% fee might decline from $ 1,000 to $ 700 yet the client is out $ 30,000.  That hurts a lot more.

What does putting the client first in practical terms mean?

1. We are all in this together.  When a surgeon removes a bullet, they are doing a great thing, but they don’t have a bullet in their own body.  It’s a fair assumption the advisor has money invested alongside the client.  When the client suffers a loss due to decline account value, so does the advisor.  Let them know you are invested alongside them.

2. Provide guidance.  You’ve got access to plenty at the firm.  “Here’s what we think is going to happen.”  No one can accurately predict the future, but if/then statements are pretty helpful.  “If a vaccine is developed soon, then...”  They want you to have an opinion.

3. Here’s what I’m doing.   Your client’s situation is likely different than yours.  However, if you are taking action, don’t keep it a secret!  “I’ve been doing some buying...I’ve been nibbling...”  They will probably assume as a financial services professional, you know what you are doing.

4. I’m here for you.  This means they shouldn’t wait to hear from you if they have concerns.  They should pick up the phone and call.  Maybe you are part therapist here.  An advisor who shares his “newsy” e-mails to clients tells them to call “Any time of day or night.”  The point you are making is they should not hesitate to reach out.  You are here to help. 

5. Newsletters.  These might be e-mails.  The volatility has lasted for weeks.  It’s unclear how long it will continue.  They might have forgotten that earlier conversation or missed the point “I’m here for you.”  Sending an update via e-mail regularly gives you a channel to pass good (and other) news along when you find it.  You can reinforce: “Call me anytime if you want to talk.”   

Two Closing Thoughts

Not all advisors think the same way.  I was in production at the time of the Crash of 1987.  The DJIA was down 508 points in one day.  (That was considered a big deal back then because it was a 22.6% drop.)   On that day, I thought about all my clients, young and old, wealthy and not so wealthy, I had gotten into the stock market.  I said aloud: “What have I done to these people?”  Another advisor overheard me and said: “How can you not be thinking of yourself at a time like this?”  I felt proud at that moment.

Clients realize we make our living from fees they pay to the firm.  They don’t know exactly how that works, but they assume we are hurting and want to be compassionate.  I was mindful the losses they suffered were far greater than my drop in income.  I would explain: “You don’t need to worry.  We just go from being wildly overpaid to merely overpaid.”   Sometimes a little humor helps.

Related: What Every Prospect Needs to Know About You