Debunking myths about how you do business

Like every profession, people believe in misconceptions about financial advisors and insurance agents. Here are a few of them and how you can counteract them.

How you do business. This likely involves financial planning, presenting a proposal addressing their issues, making investments, and meeting periodically to review performance and progress.  You are seeking a long-term relationship.

Myth: You sell only one product. Whatever their need, you will somehow explain why your one product is the solution.

Training and experience. How long have you been with the firm? Are you on a team? What is the combined experience of the team? How long was the training period?

Myth: Anyone can sell insurance. They do not know licenses are needed. They might think you are new at it and need to practice on some people before you “get it right.” They do not want to be part of your learning curve.

Size of relationships. If you help people with investments and saving for retirement, you have assets under management. That is a good way to measure the size of relationships and the overall size of your practice. Accounts that grow in size indicate long-term relationships.

Myth: The prospect might assume your business is transactional. People buy one product, then you both walk away.

Priced fairly. When people talk about high-net-worth individuals, the public sees them as people with money to burn who do not look at prices. Many people think wealth management is expensive. You are priced fairly.

Myth: Some people think financial advisors work with people who have no price sensitivity. You charge them high fees because they can afford it and do not care what they pay. In reality, the industry is very competitive, and fees are always subject to downward pricing pressure.

Service-oriented approach. You feel everyone’s situation is unique. You take time to learn about their situation, objectives and dreams. You work with them over the long term to help make progress toward their goals. Decision-making is collaborative.

Myth: On TV, financial advisors are often portrayed as arrogant, type-A personalities who intimidate others. They think their investment philosophy is “my way or the highway.” If the client shows doubt or hesitation, the advisor wants to drop the client. It makes for good TV viewing, but this is not true in your case.

You need to increase the understanding among prospects and clients; otherwise, the myths become entrenched and they either do not do business or they leave.

Bryce Sanders is president of Perceptive Business Solutions Inc. His book “Captivating the Wealthy Investor” is available on Amazon.

For more ideas about how to improve your communication with clients:

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