Deeper client relationships breed greater successArticle added by W. Thomas Spencer on December 6, 2012
W. Thomas Spencer, Jr.

W. Thomas Spencer

Joined: December 06, 2012

At my practice, we have developed a three-part process to determine the best possible financial solution for each individual client.

More and more financial advisors today are getting involved in a transition from product to process and, as a result, are not just surviving but thriving in the current economy. Advisors who focus on the process of identifying their clients’ needs rather than simply recommending favored products are able to consider their clients’ complete financial situation and deliver solutions from a broad menu of products and services to meet those needs. It’s a win-win long-term for all involved.

As a result, clients look forward to hearing from their advisor because the sales pitches have fallen out of the equation. And, as bonus for the advisor, clients are more likely to provide referrals after establishing a comfortable and positive relationship with their advisor. Clients don’t feel they’ve been taken advantage of when the emphasis is on their overall financial well-being, and they want the same for their family and friends.

At my practice, we have developed a three-part process to determine the best possible financial solution for each individual client:
    1. Evaluation
    2. Positioning
    3. Management
The discipline of this process has been well received by our clients and has resulted in significant business growth. Clients appreciate the diligent care we take in their overall financial planning.


In this phase of the process, we take the time to understand a client’s complete financial and personal profile. Intense fact-finding is involved, in which we ask a variety of questions to get a handle on existing assets and liabilities, but also to uncover future scenarios like the cost of weddings for children, a potential inheritance, perhaps the acquisition of vacation property, or the eventual downsizing of the family home. Based on the data we gather, a financial model is created, exhibiting how the client’s goals and objectives will be met over time. We use very conservative assumptions in our models with regard to investment returns, inflation and other variables. Many new clients are shocked to see that they will run out of money based on these assumptions. As such, they modify their financial behavior and pay more attention to how they handle their money. When they return for their annual review, they are always interested to see if they have made positive progress or if further changes are necessary.


This phase is when the advisor will adjust the elements of a client’s program to be more successful. Because this step could be as simple as changing a beneficiary designation or involve a total reworking of the client’s asset allocation or insurance portfolio, we keep our explanation of this part of the process deliberately general to reflect the personal nature of the process. In the previous step — the evaluation phase — the client has come to understand the need for our guidance to meet their objectives, so they are more trusting during this stage and are definitely more receptive to change.

The third element of our process, management, refers to ongoing monitoring of not only the changes in our clients’ objectives, but also adjustments in their timeframe, risk tolerance and several other variables including fluctuations in the economic environment. Eleven months after we introduce the financial model, our clients receive an email from our office, which includes the prior year’s balance sheet, goals and objectives. During the next month, we develop a complete annual review that updates their financial model, reviews their investment portfolio, protection products and any estate planning arrangements. Our clients look forward to these reviews as a refresher and opportunity to reevaluate their plans.

By adhering to this process, our firm is able to identify the products and services we offer to best assist our clients without sales pitches. Our evaluation could reveal the need for long-term care insurance or estate liquidity, for example, or it could identify excessive risk in an investment portfolio. Our financial modeling could point to a lack of discipline, giving us the opportunity to provide value-added guidance. As a result, a product purchase often becomes the by-product of the planning process. There is little or no selling involved; it’s about doing what’s in the best interest of our clients to meet their financial needs.

Advisors who make this transition from product to process develop deeper relationships with their clients and are more likely to get referrals. Best of all, they are able to get more satisfaction out of building their business, while helping clients at the same time.
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