Bill Hortz's picture

[Holistic financial advice has become an increasingly important topic of discussion and debate across the industry. Much has been said by advisors and wealth management firm leaders about this advisor business model but, most important, is the reality that financial consumers have come to expect a more highly personalized advice experience that combines digital, virtual, and human interaction on a broader range of products and services.

Accenture’s The New State of Advice 2021 survey interviewed over 1,000 wealth management consumers to understand what investors expect from their wealth managers regarding financial advice, products, and planning. The survey reveals that 55% of financial consumers across a broad spectrum feel the advice they receive is too generic, and digging further, almost 90% of High-Net-Worth investors with $10 million or more in personal wealth felt the same way.

The survey report emphasizes that this is an opportunity for wealth managers to expand their advice offerings beyond just managing investments by learning how to deliver a more holistic and personalized experience at scale. However, standard advice business models may not have kept pace with the rapid rate of change across new services, products, and technologies available to the industry.

The report further explains how holistic advice “requires a breadth of guidance, products, and services beyond investments, delivered in the right context to meet a client’s financial, emotional, and social goals”. This effort reimagines the client-advisor relationship by looking at the client holistically, across their balance sheet and across their life stages. It requires wealth managers to think differently and act differently. This more expansive approach can create a path for advisors to create a compelling story introducing unique, client-centric offerings as a competitive differentiator. To do this, wealth managers must bridge digital, advice, and service, while equipping their advisors with the skills and technology they need to create a seamless customer experience and ensure a comprehensive, holistic approach to financial planning and advice.

To better understand how advisors can respond to this holistic advice model opportunity, we reached out to new Institute member Dan Collison, Managing Partner of Advice2Advisors – a financial advisor professional development firm specifically designed to help advisors build holistic processes for every aspect of their business. This encompasses from tax and investment planning processes to referral and introduction processes. Dan’s workshops and keynotes were developed through extensive industry knowledge culled from working with top advisors across North America for over thirty years and empirical, professional development research including mindset, influence, and positive psychology leaders Carol Dweck, Martin Seligman, Robert Cialdini, Dan Ariely, and the DIA Institute. He is the author of The Financial Advisor’s Guide to Excellence and, publishing in February 2023, Building Bigger & Better - Growth Strategies of Top-Producing Financial Advisors.]

 

Hortz: How would you define and characterize “holistic advice”? What does that look like?

Collison:  A number of years ago I heard a top-selling “holistic” advisor, Paul, speaking about his business model. Paul said that when he completed the paperwork to open a new client file, he would look that new client in the eyes and state: “If ever you have a question you need answered, and it has a dollar sign in front of it, give me a call.”  That statement comes as close to describing holistic advice as any I have heard. I would add, for clarification, that holistic advice includes:

  • goal setting
  • asset management
  • cash-flow management
  • risk management
  • debt management
  • tax planning
  • retirement planning
  • estate planning

Beyond these basics, I would include the need to have a good understanding of family law, as it tends to weave its way through so much of personal finance.

Great, holistic advisors start with a deep dive into client goal setting and then work with all of these financial planning elements to ensure their goals are achieved. Ultimately, they create a financial roadmap for their clients and formalize it within a written financial plan.

Hortz: What was your motivation to start a professional development firm for financial advisors built around holistic financial advice?

Collison:  I was lucky enough to start my career in this industry with a firm that fully endorsed comprehensive financial planning, so holistic advice was at the heart of the work I did with my own clientele. Subsequently, I got into management at the firm where I was tasked with training and coaching this holistic methodology.

Shortly thereafter, I was hired at the Schulich School of Business to teach Personal Financial Management in the MBA program, where I taught part-time for 20 years. This forced me to go further into the empirical research on all things financial planning, as well as for coaching and personal development. Ultimately, my absolute belief in the need for quality holistic financial advice for consumers steered me in the direction of establishing Advice2Advisors with my business partner Tina Carthigaser. Through our firm, we have been able to work with financial advisors across North and South America, which has been unbelievably rewarding – and educational – for us.

Hortz: What do you feel are the key takeaways most important for advisors in the Accenture “New State of Advice” survey?

Collison:  In the study’s call to action, a critical headline offers us “Embracing a new business model:  Holistic advice.”  Certainly, AI and all things digital have added both benefits and new challenges to the way advisors run their businesses, but holistic advice is not new to the industry. In fact, it began to be offered as far back as the late 1960’s and early ‘70’s when financial planning in America was in its infancy. There are a great many advisors who have been supplying holistic advice to their clients for decades. However, there are significantly more that do not offer such all-encompassing advice.

What this study, and previous versions of the study, blatantly illustrate is that consumers are finally recognizing the need for holistic advice. They do not know what to call it, necessarily, but they want that comforting sense of advice that seems more comprehensive or thorough. And those advisors and firms that do not provide it will most certainly pay the price competitively going forward.

Hortz: Can you discuss the research and sources that you used that most influenced your training approach and are built into your professional development workshops and keynotes?

Collison:  At the very top of the list are top-selling advisors. I have relied on their best practices from the very start of my advisory career and continue to do so today. Beyond that, we read the books and papers written about the industry, whether they are produced by practitioners or academics, as both views provide resources that we can work through and synthesize in our coaching and training.

Finally, I have become addicted to the research that focuses on optimal human functioning. Much of this coming from the stream of psychology known as positive psychology. The more I delve into it, the more my belief grows in what that research reveals: peak performance is both teachable and learnable. Our goal is to take that research and distill it to a level that shows financial advisors the means to achieving spectacular success, whatever that success might look like to the individual advisor.

Hortz: How did you apply and structure all this research into practical steps or processes you provide in your professional development workshops?

Collison: I was introduced to working a process from the very start of my career. My firm had a sales process that laid out, step by step, actions to be taken for turning a prospect into a client. That process was critical to my initial success as an advisor. My next inculcation came while studying for my Certified Financial Planner (CFP) designation. The financial planning process is a stalwart process in our profession.

But what truly turned me into an advocate, and creator, of processes, began when I started teaching at Schulich. I had to be able to show my MBA students how advisors worked with their clients on investing, tax planning, and all the other elements of financial planning. The simplest way to do this was to build processes into my lectures that the students, as non-practitioners, could visualize and thereby, better understand. Many of those processes made their way into my first book and have continued into my newest book.

Advice2Advisors’ coaching and training are full of such processes, as it makes it that much easier to present working strategies and structures for financial advisors to adopt. Likewise, when an advisor shows a prospect or client the investment planning process, tax planning process, estate planning process, etc., – whether in a meeting or in an educational seminar – these processes highlight the very strategic manner in which they operate.

Hortz: What kind of outcomes and feedback are you seeing?

Collison:  We pride ourselves on our unique ability of taking everything technical in financial planning, and turning it into concepts, speaking points, strategies, and deliverables for advisor growth. Growth is at the heart of everything we teach. Furthermore, we have come to understand the unique strengths that all top-selling advisors have developed, which we call - The 3 Confidences of Top-Producing Advisors. They include:  1) a Confident Mindset; 2) a Confident Business Structure; and 3) Confident Growth. By training advisors to these distinct aspects of the business, they quickly see a new path to success, and for mature advisors, a rejuvenation or resurgence of energy for their businesses.

Our website has numerous testimonials from advisors we coach and train, and we are very proud of their extremely positive feedback. But mostly, we value the quantifiable growth results that we hear directly from our clients. One of our coaching clients recently told us about his tripling of new assets brought in over an eleven-month period, going from $20 million the previous year to just over $63 million in those 11 months. He did it by adapting a laser-focused approach to his Ideal Client – business owners – and then followed through on our plan to gain targeted introductions to other business owners from his existing clients and centers of influence. While we do not expect every advisor to see such dramatic growth in this short period of time, we do work with them to double their business within three years or less. For growth-oriented advisors, this is a very realistic, and very attainable goal.

Hortz: What recommendations or advice can you share with advisors and financial firms on how best to respond to this new opportunity for advisors to expand their advice offerings beyond managing investments to holistic advice?

Collison:  The simple answer to that is for an advisor to become the “Personal CFO” to their “Ideal Client” profile. By doing so, an advisor will surround themselves with, and become the conduit to, all the professionals their ideal client will require lawyers/attorneys, accountants, money managers, insurance specialists, and lenders. By doing so, an advisor can confidently mimic Paul’s statement, “If ever you have a question you need answered, and it has a dollar sign in front of it, give me a call.” 

The Personal CFO understands that they do not have to have all the answers. They just need to be connected to the experts that do . . . and that is what makes true, holistic financial advice a possibility for any advisor to deliver. Recognizing this, advisors can confidently go to market with their own unique value proposition, targeting their ideal prospect. We have seen this play out successfully, time and again, with the advisors we work with. It is all about confidence.

 

The Institute for Innovation Development is an educational and business development catalyst for growth-oriented financial advisors and financial services firms determined to lead their businesses in an operating environment of accelerating business and cultural change. We operate as a business innovation platform and educational resource with FinTech and financial services firm members to openly share their unique perspectives and activities. The goal is to build awareness and stimulate open thought leadership discussions on new or evolving industry approaches and thinking to facilitate next-generation growth, differentiation, and unique community engagement strategies. The institute was launched with the support and foresight of our founding sponsors – Ultimus Fund Solutions, NASDAQ, FLX Networks, Advisorpedia, Pershing, Fidelity, Voya Financial, and Charter Financial Publishing (publisher of Financial Advisor and Private Wealth magazines).

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