As advice firms undergo FOFA implementation and move to a ‘fee for service’ model, many are looking to cater to high net worth (HNW) investors, including new entrant to the market, Hamilton Wealth Management, which laid out its segmentation plans in a statement this week.
However, Elixir Consulting managing director Sue Viskovic, who coaches financial advice firms on pricing and business model issues, says focusing purely on this client sub-set is a narrow approach to service proposition.
“Advisers should be selective with their clientele, and that’s about creating an offer that is absolutely suited to a certain market niche – but that in no way means it should be HNW clients or that is has to be HNW clients,” Ms Viskovic told ifa.
“HNW investors are not the only clients that will pay fees – there are all sorts of clients that are happy to pay for quality advice – it’s about finding that market niche.”
Elixir Consulting has found that many financial advisers only have a handful of clients that they truly engage with and have a strong relationship with, and recommends that advisers focus in on this segment of their client base.
“There’s a difference between clients and customers,” Ms Viskovic said. “The challenge for advisers is to really gain a handle on where their revenue is coming from and…move away from the legacy and trail commissions and not be dependent on them.”
In August, ifa reported that research conducted by financial services technology provider Worksorted suggested there is a discrepancy between the amount of revenue being generated by advice firms and “anecdotal evidence” about client revenue streams – with a large number of advisers reportedly claiming to cater to HNW clients in communications with licensees and platform providers.
[quote name=”James J”]”You can fool some of the people some of the time but you can’t fool all of the people all of the time” Just ask Kevin Rudd.[/quote]
There you go again James. Yet another pearl of wisdom. Looking forward to the next thought provoking instalment.
“You can fool some of the people some of the time but you can’t fool all of the people all of the time” Just ask Kevin Rudd.
Word of mouth is great – but no one I know has too many good words about their FP.
Would be really great to find a top notch FP, who is not looking to tie me in for >$10k PA.
[quote name=”James J”]Rick
Like I said, FP’s in my experience, make more mistakes than I do and overcharge for their mistakes. That doesn’t mean there aren’t some good ones out there…It just means I haven’t found one as yet. Not that I’m looking.[/quote]
Bit hard to find something you are not looking for, isn’t it? The good ones, like our practice, aren’t out there on the front pages or advertising as word of mouth fills our books. And we also get to choose our clients, looks like no-one good chose you James J, hmm wonder why not?
Rick
Like I said, FP’s in my experience, make more mistakes than I do and overcharge for their mistakes. That doesn’t mean there aren’t some good ones out there…It just means I haven’t found one as yet. Not that I’m looking.
[quote name=”James J”]This is another reason for SMSF Trustees to avoid using Financial Planners because they DO NOT earn their fees and are consequently a waste of money whether you are a HNW invester or not. Just another self delivered nail in their collective coffin. Good luck signing your own death warrent. In my experience FP’s make more mistakes than I do anyway.[/quote]
James, you’re a clueless child. Grow up and contribute something meaningful, or get some professional help.
This is another reason for SMSF Trustees to avoid using Financial Planners because they DO NOT earn their fees and are consequently a waste of money whether you are a HNW invester or not. Just another self delivered nail in their collective coffin. Good luck signing your own death warrent. In my experience FP’s make more mistakes than I do anyway.