Forbes


Charlotte Beyer - Contributor

Five Things Rich Clients Hate About Their Advisors

Whether the individual is a prospect or already a client, advisors often fail to see how much they annoy ultra high-net-worth investors.
Here are the top five pet peeves as expressed by investors who are members of the Institute for Private Investors [IPI]:

1. Brochure Speak – advisors feel compelled to use the stilted language of their marketing brochure even when sitting across the table from the prospect or client.

2. Speaking in paragraphs instead of sentences – too often advisors speak in long winded, winding paragraphs rather than simple declarative sentences, thus giving no opening for the client to ask a question or comment.

3. ‘Having said that’ syndrome – continually using ‘on the one hand, on the other..’ in their conversations, advisors cause investors to suspect their advisors have no strong convictions – except perhaps to keep clients in the dark about their true opinions.

4. Unequal air time – many investors feel advisors speak far more than their share, perhaps out of fear the investor will ask a difficult question or express some disappointment in the performance or service of the advisor.

5. Defensive or arrogant posturing – when a client is using a successful strategy with another manager, the reaction of the advisor is dismissive, hinting that somehow this strategy cannot be truly better, known by the industry as the ‘not invented here’ problem.

All five of these pet peeves were cited by one investor in a phone call just last week when he described ‘three stuffed shirts’ sitting across from the family and visibly uncomfortable with the investor’s trading strategy with another firm. As smart as this well known firm is, its inability to listen without defensiveness put a few more nails in the coffin of that already weak
relationship.

The solution? The leadership within small or large advisory firms needs to acknowledge the critical need for emotional intelligence (see author’s article in CFA Magazine, December 2009) and train front line advisors accordingly – or remove them from having any client interaction.

Stuffed shirts with a tin ear have no place in the ultra-high net worth advisory industry. Firms whose clients are loyal and satisfied already know this. These highly successful advisors know how to listen, how to speak authentically, how to express disagreement with clients when necessary, and they maintain a personal and steadfast connection with those investors.

IPI is a 20-year old membership organization that connects 1,100 ultrahigh-net-worth investors to one another inside an online community and at events throughout the year, seeking to change the way investors work with advisors, and advisors work with investors, for the benefit of both.

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