Avoid Irrelevance- Reinvent Your Financial Practice

Avoid Irrelevance: Reinvent Your Financial Practice

Business school’s books and the internet are filled with examples of industries or companies that failed to heed the winds of change and now, they no longer exist. When my husband and I visited the Guinness beer factory in Dublin Ireland, I was intrigued by the story of the barrel makers (coopers) and how that was a thriving craft until cheaper?methods, and easier to use materials became available.

The most recent memorable example is the mortgage industry. It was booming before the Great Recession due to favorable lending terms and rates. When the financial crash came, many companies were on the brink of collapsing (Lehman did.) Individuals in the mortgage lending business also had to find ways to reinvent themselves.

Technology has already revolutionized other industries and careers (Uber, Amazon, Call Centers, etc.) How people adapted to those changes determined whether they remained relevant. The Financial Services industry is currently involved in a sea change due to technology (Robo platforms), potential legislation (DOL) and changing market demand (tech-savvy and Gen Y clients.)

Many people advocate focusing on a “Niche” and creating a “differentiating” value. Many of those ideas don’t really involve doing anything different, other than marketing and segmentation. Don’t get me wrong, those are good ideas, but they are just versions of what Advisors are already doing.

Fidelity’s Tech Guru Predicts FAs Will Become Life Counselors

Other people and companies are looking at Financial Advice with a different lens. What if you focused more on helping the client achieve their overall life goals and developing the finances needed to support those? What if you were able to assist in managing their emotional and behavioral biases that so often result in costly decisions? What if you became a Wealth Mentor?

Avoid Irrelevance Reinvent Your Financial Practice

Behavioral Biases are our natural, hard-wired reactions to events and situations (market volatility, family, etc.) We all have them, whether we want to admit it or not. As a Wealth Mentor, you can identify the client’s natural behavioral biases and help manage them before the client is triggered to make an emotional decision that will disrupt their Financial Plan needed to accomplish their goals. The best investment recommendations and financial plans are useless if the investor ignores that advice abandons the plan with the next “trigger.”

Cost of Ignoring Behavioral Biases
By Jay Mooreland, The Emotional Investor

Helping them stay on the plan to achieve their goals is the best value you can provide that will differentiate you from the rest of the pack.

Most Financial Advisors were attracted to managing investments and narrowly defined their service and revenue model along those lines. Not only is investment management becoming a commodity, but the whole Financial Advisor business model is being questioned. Many companies and people are eager to fill in the gaps. Merrill Move Upgrades Behavioral Finance.

How will you adapt?

Kriss Poll

Kriss Poll - Chief Operations Officer, Relationship Management Integration

Kriss is passionate about helping organizations unlock the power of behavioral understanding to successfully accomplish business goals. She works with leaders to further develop their organizational goals and to build collaborative teams that can execute. Kriss believes that tailoring solutions, communications, and experiences for customers, vendors and employees based on behavioral insights will propel companies ahead in our highly interactive and competitive landscape.

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