Attract and retain high-net-worth clients over 40-years-old

February 19, 2018 by Matt Marcum

A business professional works through his tax plan.

about the author:

Matt Marcum

Sales enablement lead

Matt is a 2009 graduate of the University of Michigan and has worked in multiple roles at Advicent. He loves talking about financial planning and the value it brings both to advisors and to their clients. When not discussing FinTech trends with advisors, he enjoys spending his time outdoors with his wife and their dog.

Have you ever wondered how to differentiate yourself from other advisors or wealth management firms when it comes to attracting high-net-worth individuals (HNWIs)? Fortunately, the trick may be easier than you might think, especially when trying to attract those HNWIs over the age of 40.

How to win the over-40 HNWIs

Leading with financial planning could be the key in not only making your firm stand out among this age group but could also deepen relationships and reduce the amount of firms with whom HNWIs work.

Many studies continue to indicate that HNWIs over the age of 40 tend to work with multiple wealth management firms. In the Capgemeni United States Wealth Report, 49 percent of HNWIs worked with five or more firms, while only 31 percent of HNWIs received consolidated advice from only a single firm.

This indicates that wealth management firms are having a hard time providing enough specialized advice for their most valuable clients.

Providing holistic financial plans

HNWIs require sophisticated financial plans. This is where the myth of goal-based planning finds its shortcomings. While identifying a client’s goals is important and one of the six steps laid forth by the CFP board, it is important to pair these goals with accurate cash flow analysis.

By providing cash flow planning, firms can truly dig into a goal and provide the analysis to accomplish it. Cash flow planning is the foundation of a strong plan, which allows for detailed income tax planning and all of the strategies that go along with an accurate tax projection.

Consider a 50-year-old CEO at a local company. This individual is likely to require many advanced strategies to accomplish their goals for their family. For instance, they may be receiving stock options from their company that will be a large part of their wealth and their retirement source. By leveraging a NaviPlan, which specializes in advanced planning concepts, your firm can meet the many needs of the most lucrative clients.

To learn how Advicent technology can empower your firm to attract and retain HNWIs, click here.