“Alex” (not his real name) is a friend and ex-client.
Alex leads a Private Client practice for a private wealth management firm in a country whose name I will not reveal, but which lies somewhere to the north of the United States.
We talked about his approach to managing his clients’ money. First thing he notes—it’s not just about managing their money.
“They need help from time to time in various aspects of their lives,” Alex says. “I get to know about these issues because they have financial impacts. Marriage, Children, College, Divorce, Insurance, Disease, I hear about them all. It is important to weave all aspects of the client’s life through their financial affairs, nothing personal happens in isolation.
“I cultivate a network of people I know, respect, and trust. Exceptional people who understand the power of relationships; people in real estate; divorce mediation specialists; psychologists; medical specialist; and educators who can help my clients. Whatever it is that they need—I make it my business to help them.
What do your colleagues think of this, I ask?
“They don’t get it. They say there’s no money in those things. I say that’s not the point… I’m in this profession to help people. But in the long term, they are dead wrong—in fact, there is money in this.
“For example, I spent an hour talking with the19-year-old daughter of a client about how to manage her $3,000. I took flak from colleagues for that too. But what they forget is how delighted her father was that his daughter was getting sound financial advice at age 19.
"And he has considerably more than $3,000… as will his daughter, sooner or later. My relationship is with their family.”
“What my colleagues forget is that this is a relationship business. Clients are referred by their parents, their children, friends, colleagues, accountants, lawyers etc. This only happens if you play for the long run.
“But it works; it works beautifully. Some people in my business focus on their transactional income, or look for ways to go seeking more clients through seminars or mailings. I focus on the relationships with my clients and appreciate when they invest in my business through referrals… my cost of marketing is nil.
“But perhaps most importantly, I spend my working days helping people, people I like. My practice is built on relationships where I enjoy working with the clients and they enjoy working with us. How much better can work get?”