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It’s a rough ride for new advisors. Prospects can tell you’re new, so they hesitate and object. How do you respond?

Read: How to lose referrals

Three fears surface when a prospect considers doing business with a newly minted advisor:

  • You know nothing – Investing’s complicated. If it were easy I’d do it myself and cut out the middleman. You probably know less than I do.”
  • You’ll flunk out – “It’s a difficult business and turnover is high. You have to sell a lot and hit your numbers or it’s goodbye. Do you have staying power?”
  • I’ll lose money – “You’ll be practicing with my money. You learn by trial and error. I’m the guinea pig.”

Prospects rarely see the advantages of working with an advisor fresh out of training:

  • Latest Knowledge – New products are developed constantly. Experienced advisors often reach a comfort level and are resistant to introducing new products to satisfied clients. You know the full range of products and potential solutions available. You just learned it.
  • Attention – New advisors have fewer clients. The established advisor is adding another relationship to a practice that already fills her day. The newer advisor has the time to be more responsive.
  • Respect – The $1 million client is just another face to a big producer with 200 clients and $800 million in assets. That same account may be the largest for the new advisor. The client’s treated like royalty.

Read: Send prospects the right signals

Three Scenarios

Ideally, hesitant prospects voice their concerns.

#1. What do you know about investing?

Sometimes expressed as: “You were a great engineer when I knew you at (firm). Now you’re at XYZ securities. How long have you been doing this job?”

The fear: “You’re inexperienced and don’t know what you’re doing. You’ll try to bluff me to cover up your mistakes.”

The misunderstanding: They assume you’re a stock picker or portfolio manager. You are a relationship manager.

The message: “You’re hiring a firm and its global resources. My job is to bring those resources into your living room. I’m the relationship manager responsible for your account.”

#2. How do I know you’ll be around in two years?

It’s a tough job and turnover’s high.

The fear: “You’ll wash out or quit because the work is too hard. Will I even know you’ve quit or been fired? Who’ll ‘watch my stuff’? Why will they even care about me? They don’t know me.”

The misunderstanding: They assume anyone off the street can get hired, and that your manager tossed you a phone book and left you to fend for yourself. They don’t understand you took this job because you want to succeed. They assume you’re not salaried and have no support.

The message: You’ll be here because you’ll move heaven and earth to succeed. You earned your place through a competitive selection process and your firm’s spent a substantial sum training you and paying your salary while you establish your practice. As an advisor, your objective is to help clients reach their goals. You’ill be in touch on a regular basis with progress reports and updates. That’s how they’ll know you’ll be here.

#3. Practice on someone else, then call me in two years

The fear: “Stock trading is a learned skill. It’s a combination of intuition and research. You’re new and inexperienced. You’ll gain some experience but at my expense. I don’t want that.”

Read: How to handle insults

The misunderstanding: They assume you’re a stockbroker or a trader. But you’re a relationship manager. You recommend professional money managers — firms with decades of experience in the markets.

The message: “That’s right, stock trading is a learned skill. If you invest money you want the best people making those decisions. When we work together you and I will choose professional money managers, firms that invest on behalf of institutions and pension funds. They typically require $5 million to $10 million to establish an account. They’ve been doing this a while—they don’t need any more practice.”

Bryce Sanders is President of Perceptive Business Solutions Inc. in New Hope, PA. His book “Captivating the Wealthy Investor” is available on Amazon.com.
Originally published on Advisor.ca

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