The regifter. The low talker. The sidler. The habit of Seinfeld’s lead characters to pin humourous names on the people they encountered made for some of the show’s more hilarious moments. But this on-screen humour is more than just comedy – it can be of great help to advisors.
Potential clients you already know may have personality traits that make them highly undesirable or even impossible to work with, and for this reason worth weeding out of your prospective client list. Here are 14 types of people you may want to avoid:
The bad temper
Do they start bar fights? Are they litigious? Do they have a short fuse? If you answered “yes” to one of these questions, you probably don’t want to be their guide in the financial markets.
Does your friend often ask for free advice or assume they only need to pay for advice on days they place a trade? How much are you willing to give away?
When they become your client you are expected to be available 24/7 for questions and advice, even when you’re on vacation and during social events.
The second guesser
Do you know someone who always seems to assume the outcome was obvious after the fact? They assume everyone in the industry saw a decline coming, but you focused on getting preferred clients out first, at their expense.
The conspiracy theorist
They think the entire financial system is corrupt and the stock market is manipulated by big firms at the expense of the little guy. You are part of the system that is stealing their money.
They feel any fees they pay your firm go entirely into your pocket. They imagine you are making money at their expense and resent it.
They are in bad financial shape and think all they need is that one big score. They think investing is like gambling in Las Vegas. They are acting far outside their risk profile and insist on calling the shots.
They refuse to follow your advice yet hold you responsible when things turn sour.
They think the amount of fees they pay determines the results their investments deliver. If the market goes against them, it must be because you’re a bad advisor. They paid you, didn’t they?
The rule bender
They don’t have a problem with unethical behavior. They sign their spouse’s name on documents, for example. It’s just between us friends, so who’s going to know?
They have access to inside information and use it to their advantage. They seem to have more money than they should, depositing and withdrawing constantly. Could they be laundering money?
They found a get-rich-quick scheme on the internet or through a friend of a friend. They don’t understand it but are confident it works, and they need someone to place those trades on their behalf.
Regardless of account size they see themselves as your most important client. Whenever they call your office, only you are qualified to handle their issue, however trivial. They refuse to let your staff assist them.
The hypercritical relation
Your father-in-law doesn’t like you and is waiting for you to screw up. You have an uncle who divides his time between revising his will, picking fights and holding grudges.
Sometimes the baggage prospects like this carry far outweighs their potential value as clients. In some cases another advisor in the office may be a better fit, while in others they need to work with an advisor at another firm – far, far away.