How to wow clients

To impress clients, go against your self-interest.

A friend recently told me his advisor turned away $5,500 in business. Here’s what happened.

My friend invests about $100,000 with his advisor—not a fortune, but he’s 30 years old and rising quickly within a TSX60 corporation.

His advisor of two years emailed to wish him a happy Diwali and to ask how his marathon training was going. That led to scheduling a casual lunch, where she suggested they talk shop for a bit. She asked him to bring his benefits information so she could check if he was maximizing that part of his compensation. For efficiency’s sake, he also brought a cheque for his 2014 TFSA contribution to an existing mutual fund. (He maxes his RRSP through a defined-contribution pension.)

The benefits chat revealed employees can now hold their employer’s stock in TFSAs. Since my friend was already using the company’s stock purchase plan, the advisor recommended he start contributing to his TFSA under that program instead. Her reasoning? It’s a growth stock and he may want to sell in the next few years to diversify his holdings, so he could shelter those gains.

At first blush, the advisor lost a chance to hike a portfolio by 5%. But showing clients their overall financial health matters more than short-term revenue targets builds loyalty.

My friend says his advisor’s forthrightness impressed him—so much so that when lunch finished, he left the cheque with her. He’s putting it toward his non-registered account.

So in the end, an offer to turn down assets actually worked in the advisor’s favour.