From time to time, we'll ask advisers and program managers a list of questions that we feel can benefit others in the industry. Their responses may be edited for length and clarity.
Adviser, Wells Fargo
Des Moines, Iowa
What's the biggest challenge you're facing as an adviser that has surfaced in the past 2 years?
Client expectations. Diversification away from the S&P 500 has caused a lot of questions due to performance. A typical question from clients involves why we just don't put all their money in the S&P. I try to emphasize that everything goes in cycles, and the need for diversification to smooth out volatility has never been more important. This is especially true for those about to enter or in retirement. And oftentimes the retail client wants to go into what has done well, which always proves disastrous. Just ask anyone who jumped into the tech market in 1999.
How did you meet that challenge?
Communication. It's important to maintain constant dialogue with clients. Quarterly contact is a must. And, as always, bringing the client back to focusing on the most important aspect which is their financial plan. It's good to know, for example, if the market is down 40% and the client account is down 10%. But still, what clients want to know is whether they can still retire on time, or if they are in retirement, can they spend the same amount. Listening needs to be the adviser's number one attribute. The client needs to know you understand the concerns before you start coming up with answers.
What's the biggest mistake you see rookie advisers making?
Trying to be all things to all people. When I first started in the business, I said "yes" to everything if it resulted in a new account. I started trading options for a client and it didn’t take me too long to realize I was not cut out for it. Too complicated and too time-consuming. Luckily I didn’t make an error. Also, there were many times early on that I took on a client who I knew would be difficult. It is never worth it.
What aspect of your job do you like the most?
Being a trusted resource that clients can turn to. It is an honor to be able to help people with the intimate aspect of their money.
What's the biggest professional change you've seen since you joined the industry? How long have you been in the industry?
The role of technology and the information overload on clients. All sorts of information is coming to the client, on TV and online. In my opinion, it has only hurt the investor. Also, the move to fee-based business. Definitely a positive for clients as well as the adviser.