How to communicate with clients

Part of providing great service is regularly communicating with clients whether markets are doing well or not. In our practice, we don’t sugar coat our mistakes or exaggerate our successes.

The key to good communication is to establish a service model. Ours dictates how often we meet in person, or call to provide an update on accounts. The number of meetings and phone calls is based on our assessment of the client’s needs and wishes.

Read: How to answer common fee questions

There are also additional points of contact. This includes a monthly newsletter, and regular invitations to any events we host. Establishing a model ensures we don’t over-promise, which is especially important for advisors building their books — if you promise too much initially, it can become unmanageable as you add new clients.

For instance, some clients may want to meet every month. But it’s impossible to meet with every client every month, so we only do this for our small number of top clients. There are also some we meet quarterly. But the vast majority of clients we meet with once or twice a year.

Read: Set boundaries for assistants

And communication is especially important if investments perform poorly because it can help preserve, and even strengthen, the relationship. For instance, markets have gone through a correction in the past month, so we’ve fielded calls from clients related to this volatility. We always return calls promptly and address concerns the client has. Often, these calls are simply about reminding the client of all the steps we’ve already taken to protect his money to ensure he reaches his financial goals.

In the past month, we’ve spoken to clients about how we diversify their portfolios using multiple asset classes, focusing more on pension-style management with less risk, rather than the best returns. Because we are holistic wealth managers, we try to get a client to focus on his long-term financial goals, rather than short-term performance of markets. If we can show him that he’s still on track to meet his long-term goals, then market corrections become less worrisome. As a result, the client is usually more satisfied with the advice we’re providing.

Read: Can a robot replace you?

Because of the volatility in the past month, we’ve also tailored our monthly e-newsletter to address the market correction, and what we’re doing in the short-term to address it. For example, this month we discussed how the recent correction was likely to be short-lived. Our recommendation is to hold course and avoid liquidating. We knew clients would be concerned about the correction, so we wanted to assure them that we’re still taking care of their portfolios, and they’re on track to achieve their financial goals. Newsletters are a great way to reach all of your clients at once, especially since there may be some who are worried about volatility but don’t have the time to call.

Read: Help clients understand CRM II

Another key aspect of good communication is transparency. For instance, we explain exactly what fees the client is paying, and why. This includes any embedded MERs for mutual funds, or other fees that may not show up on statements. With the changing requirements for fee disclosure, this has given us a competitive advantage over other advisors, who may not yet be disclosing fees.

By building a service model where regular communication is a priority, we’re providing great service to our clients, while at the same time building and strengthening our relationships.