Building relationships with clients’ children can enhance your clients’ peace of mind while ensuring the future success of your business.
Clients are often eager to have an advisor look beyond their investments toward their families’ needs, says Sara Plant, vice president and national director of wealth services with BMO Harris Private Banking in Toronto. “Clients are looking to their advisors for more than just a silo approach to managing their investments,” she says.
Also, the account won’t always belong to your clients, warns Kathleen Wronski, director of wealth management and associate portfolio manager with Richardson GMP Ltd. in Toronto.
“Someday, these children will be your clients’ heirs when the wealth transfer takes place,” Wronski says, “and you want to already have a relationship with them.”
Follow these tips to build relationships with your clients’ children:
> Show an interest
Ask clients about their children immediately.
Inquire about dependents in your first or second meeting with a client, says Wronski. Find out their ages and where they stand in terms of financial literacy and needs.
> Wait for the right time
Introduce yourself or offer your services through the parents when the child reaches an age of maturity.
Ask clients again about their children when they are in their late teens or early 20s. That is when young people are working toward larger goals such as university and a career — and it is a good time for you to speak to your clients about their children’s needs, Wronski says.
“As they become closer to being adults [or if they] are adults,” she says, “they’re going to need financial education.”
> Work with your firm
Find out what educational materials your firm offers for you to pass on to clients and their children.
For example, Harris Private Banking offers the children of affluent clients a program called Financial Fluency, which offers two one-day courses for people aged 18 to 30. The courses focus on the market, investing and income-tax issues. Plant says the program was created to address client concerns that their children were ill-prepared to handle their future wealth.
Richardson GMP advisors have access to articles provided by the firm’s wealth planning group, which they can give to clients and their children.
> Compile your own resources
Establish yourself as an expert to strengthen your relationship with both generations.
Plant recommends building a small library of resources and tools you can send to clients. “Be seen as the go-to person for [financial] information,” she says. “It’s a great way to maintain client loyalty.”
Resources can include articles, checklists and links to websites.
As well, invite the client’s child to seminars, to subscribe a newsletter or to participate in a conference call, says Wronski. One of the first introductions her team often has to client’s children takes place at a lunch or dinner seminar.
> Make exceptions
Building relationships with clients’ children may require flexibility.
Many firms have a minimum account size for new clients, but Wronski recommends waiving it if possible for the children of clients. Instead, let client’s know you would be happy to work with their children regardless of their account size or financial needs.
> Never assume
Determine the child’s level of financial knowledge to avoid confusing conversations.
If you start talking about products and services using terminology the young person doesn’t understand, you will lose that person as a client, says Plant. “Adapt your language according to the maturity of the person you’re talking to.”
IE