Could how much you manage as an advisor dictate what you need to talk to your clients about? It seems there might be a connection, according to this year’s Dollars & Sense survey.

The survey revealed that what advisors spend the most time talking to their clients about often depends on the value of their assets under management (AUM). The five most mentioned areas of discussion were: investment portfolio planning/asset allocation; investment research and selection; life, health or disability insurance needs; post-retirement income needs; and trusts and wills.

It turned out that advisors with AUM over $50 million were more likely to say that investment portfolio planning/asset allocation, as well as trusts and wills, required the most time.

Advisors with AUM between $5 and $50 million were more likely to say investment research and selection, followed by post-retirement income needs, take the most time to explain to clients. Those with AUM between $3 and $5 were most likely to say life, health or disability insurance.

The results were most pronounced for the life, health or disability insurance needs category.

“It seems that advisors with lower AUM are more focused on insurance sales,” says Kathleen Peace, a CFA and CFP at Bennett March, IPC Investment Corp. in Toronto. “This means their clients might be younger, so they probably have less money and they have more insurance needs.”

Younger, newer clients have (or plan to have) families and need products to protect against financial or health-related disasters. But selling insurance to people with lower assets can require a bit more explaining on the advisor’s part because the client needs to fully understand the value of what they are buying, says Peace. “For clients with greater cash flow this can be less of an issue.”

Advisors with lower AUM also indicated they spent a lot of time on post-retirement income needs. Cynthia Kett, principal at Stewart & Kett Financial Advisors in Toronto, says this is another indication that these advisors have younger clients.

“The first place new clients start is with RRSPs and that’s related to retirement planning. If they don’t really understand anything about investing, advisors have to spend the time explaining investment concepts and how investment decisions are made. You go back to the basic concepts and this takes time,” she says.

When it comes to investment research and selection—a topic advisors with AUM of $5 to $50 million spend a good deal of time discussing with their clients—Frank Danielson, a senior financial planner with Assante Financial Management in Vancouver, B.C says those advisors may want to consider re-evaluating their value proposition.

“The value-add clients are looking for is often more about wealth planning and helping clients achieve goals than security selection and picking investments,” he says. In some cases, advisors who have been around longer and have bigger books may have already learned this valuable lesson, so they spend their time on other topics, Danielson adds.

Peace says spending too much time on research and selection could be hindering the growth of some advisors’ practices. “People are buying your time and your wisdom, not your ability to choose stocks. When you start to figure out the value really lies in the planning, it can help you be more successful.”

Advisors with AUM greater than $50 million generally have an older, higher-net-worth client base. As a result, Kett explains, advisors will need to spend more time on bigger picture concepts, like asset allocation and overall portfolio planning.

“Older clients are more experienced and they often know it’s not always so much the detailed holdings, it’s more about how you allocate it among the different classes that’s going to have the greatest impact for them,” she says.

Clients with large portfolios will naturally be interested in discussing trusts, says Sandra Foster, president of Headspring Consulting Inc. “Clients need to have a certain amount of assets for a trust because there are costs associated with them.” Trusts are also a good fit for clients with complicated family structures or multiple businesses.

While it makes sense that older clients would discuss wills, says Foster, all advisors should be having that conversation regardless of the age of their client. According to the survey, however, advisors with lower AUM were least likely to identify wills as needing the most time to explain.

“Everyone needs a will. Maybe those advisors who don’t spend much time on it are missing part of what their client needs in terms of advice. Wills and power of attorney should be part of the discussion around life and health insurance, which they are doing a lot of,” Foster explains.

Expert tips for explaining big topics to clients:


  • Ask your clients how they like to receive new information and how they learn best, says Danielson. They might be visual learners or they might like to read information ahead of meetings. Once you know, tailor your discussions to their style.
  • Plan your meetings. “Think about what key points you want to make during that meeting and bring a formal or informal agenda,” says Kett.
  • Don’t say too much. “You don’t have to tell them everything you know. Home in on things that are of immediate importance to them. If they want to know more, they will ask you then or later on. You’re trying to develop trust over a period of time, not all in one shot. Too much information can overwhelm a client,” says Kett.
  • Practice your explanation so it’s clear and concise. “I think about how I’m going to explain new things to clients. The more I practice, the easier it is to explain,” says Peace.

  • Bring a white board or a drawing pad to each meeting. “I draw out concepts for clients and keep doing so until they get it,” says Peace.
  • Use sources other than yourself. “Bring book chapters, articles, or information from your firm to a meeting. Highlight key points and refer to it as you explain concepts,” says Foster.
We thank Invesco Trimark for its sponsorship of this year’s Dollars & Sense research.
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