Teamwork in Wealth Management

Investing
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by Guy Baker

Learn more about Guy on NerdWallet’s Ask an Advisor

Key Take-Aways

  • Building a team of competent, qualified, like-minded advisors can bring a full range of service. This is the future of the financial industry.
  • Listening, documenting and teamwork are the ingredients to solving complexity.
  • Decide if you trust the competency and passion of your advisors. Can they handle the complexity?
  • A good advisor is often the gatekeeper to helping you find the experts. Make sure they’re in sync and can build a team to help you achieve your most important objectives.

As you step back from the financial world we live in for a minute and view the landscape, what do you see? Do you see a world of increasing, almost exploding complexity? Do you see a world fraught with tax issues, legal concerns, complex accounting rules and a matrix of financial products enough to make your head spin? What about the onslaught of technology?. Where I once felt competent to handle issues independently, I now feel compelled to build a teamof experts, each dedicated to a common mission and vision. Who is on this team? You may already have an attorney, CPA and investment or insurance counselor. But beware, they may have been rendered incompetent by the fast pace of change or they may be unable to work effectively on the team. They may not have the same mission and vision you have. But they are trusted advisors you say and impossible to replace. Do you have enough confidence in them to get a “second opinion?” Ultimately, you may have to surround them, delicately, with a new team to fortify the planning you need to reach your goals. Words like “mission” and “vision” are bandied about rather frivolously by many advisors today, because they know these resonate with clients and practitioners alike. We hear terms like “charitable intent”, “disposition of assets”, “equitable” and “fair” inserted in a list of goals and objectives desired by clients and advisers. But how do you get to this end game? Who defines them and really makes all this happen?

Real world example

I recently gave my “Stewardship Purpose” questionnaire to a prospective client and he quickly fired it back to me with question marks after many of the hard core questions.  “This is why I am hiring you?” he exclaimed. What he really wanted was help sorting through his options and understanding how they would integrate with his tax and wealth accumulation goals. Can’t blame him as he had a complicated family and financial situation. We spent several hours discussing the answers to the various questions. So who does this type of work? Who can sit down with a client and spend the necessary time to dream with them about the right outcome and help them cope with the myriad issues that are often obstacles to great planning and implementation?  I was taught early in my career true service is all about implementation. In other words, if all you do is talk and nothing gets done, where is the service? I remember, a couple of years ago being asked to meet with a well-known “Organizational Development” consultant. Highly respected and popular, this individual had built a sizable net worth. I was forewarned; he and his very bright spouse had been down this road several times before with financial advisors — five in fact. Each time, they had paid out large fees and invested substantial time without getting a satisfactory outcome. In other words, there had been no implementation. Despite that, they agreed to a meet me, but I was warned. They were going to ask me, point blank, what made me think I could do what the other advisors had been unable to accomplish? I was also admonished NOT to discuss life insurance with them. They were NOT interested in buying any life insurance. That was fine with me because life insurance should never be the focal point of any financial planning discussion. Life insurance is a financial product with some unique features and benefits. If it fits, then it should be obvious to everyone, the client included. So this second constraint was not a problem for me. After several gracious moments of introductions and hospitality, the meeting started and sure enough, their first question was: “Why do you think you can help us when these other firms have failed?” Forewarned is forearmed. So I was ready and true to my style, I answered their question with a question: “Why do youthink they were not successful?” After a several minutes of interesting dialogue, it became clear there were three reasons for their frustration and disappointment. First, the previous advisors’ made recommendations that were too complex for the couple to understand fully or for them to feel competent to implement. Second, their advisors were not in agreement on what should be done. But the third reason was really the heart of the matter. Many clients tell advisors how they like to buy. The client is virtually always clear about what they like and what they don’t like. Dealing with two highly intellectual, competent, articulate consultants made this all the more fascinating for me.

Deconstructing a successful client-advisor relationship

According to the husband, the reason their previous dealings with financial advisors did not work out for them, was because in each case the advisors wanted the couple to tell them whether their plan would work or not. “How would we know the answer to that question?” he complained. In other words, the couple was forced to determine the validity and competence of the advisor’s plan. This was NOT going to happen. I asked, if they would mind if I gave them a little background on the how financial advisors are schooled. As consultants and educators, they were more than willing to listen. I jumped up to a white board that was in the room and described the planning process and demonstrated the problem common to virtually every planning engagement. I also gave them our solution to the problem of communication and planning. He saw the light immediately and literally jumped out of his chair. He ran to the whiteboard and said: “You mean this is how you solve the problem!” pointing to my diagram. “Your solutions are already approved before we see them?” I told him he was correct. “Why should you have to become an expert in my field?” I asked rhetorically. He was elated and the couple hired us on the spot. We did our work and the good news; we implemented the plan as promised. The planning included his team of specialists and the end result was a product everyone agreed met their deepest needs and objectives. It was a fun assignment and we all ended the process with a feeling of satisfaction. The point of this story is simple. Listening and teamwork are the ingredients to solving complexity. Advisors can become lone rangers. It is easy for them to become isolated in this growing world of complexity and feel intimidated working with a team. There might be disagreement or confusion on the best outcome. But that is part of the planning process. There is NO ONE best answer in many cases. Optimum outcome is far more likely. Building a team of competent, qualified, like-minded advisors who can bring a full range of service is the future of the financial industry. Every advisor needs to recalibrate their approach and find new ways to build trusted bonds with their clients. The need to work together as a team is not going to go away and is likely to become more prevalent. Fortunately, there are teams forming. They have solutions and the staff to implement the optimum solutions. A gatekeeper is there to help form the team and guide the team in the planning and implementation process. Happy Hunting.

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