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056: How to Help Clients Visualize Their Financial Success with Dashboards

How to Help Clients Visualize Their Financial Success with Dashboards

What does it mean to think outside the box when it comes to financial planning? And what do financial advisors need to know about working with clients through turbulent and volatile events, such as the coronavirus pandemic? Today’s episode will explore some of those questions.

Lucas MacMillan has been working in personal finance for 10 years. He is a Certified Financial Planning Professional and graduated from the University of Manitoba with a Bachelor of Science. Lucas manages Camber Private Wealth’s financial planning effort; where all prospects are given a financial plan before investing and all clients receive ongoing financial planning support using Camber’s immersive custom financial dashboards. Lucas also leads Camber’s data science team.

What You’ll Learn in This Episode
 

  • How Camber approaches building a plan with clients (5:43)
  • How client dashboards work and what their goal is (12:06)
  • How Lucas starts with dashboards (14:30)
  • The client response to recent market volatility (24:20)
  • The goal of Lucas’s data science project (30:49)
  • How Lucas’s firm has been acquiring clients (37:35)
  • Lucas’s advice for listeners (43:31)

Links and Resources:


Lucas MacMillan

Camber Private Wealth

Quotes by Lucas:


“We really wanted to go way outside the box on financial planning.”

“Just getting people a financial plan is a huge win.”

“It isn’t extremely important that you get their financial life 100% accurate the first time you touch them. It’s something that you can massage over time, as you get to know the client.”

Lucas provides a fresh perspective on the future of the financial planning industry. His practice is using technology and data science to change the way their clients interact with their financial plans, creating a unique way to attract and retain clients. Whether you’re a seasoned wealth manager who is comfortable with status quo, or you are building your financial advisory practice and want to employ fresh tactics, you can learn from the innovative ways Lucas approaches his work.

Below, we’re sharing three key ideas from this episode:

  • How Lucas customizes client experience using data visualization
  • How Camber is leveraging data to combat low conversion rates in the financial industry
  • The importance of client education and continuous marketing during times of financial instability

To tune in to the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link at the top of this post. 

How Lucas Customizes his clients’ experience using data visualization


Coming from a background working in a centralized planning division at a larger firm, Lucas was used to communicating with clients via huge stacks of paper packed with information. When he moved on to Camber, his goal was to redefine the way in which he could display the key messages in a financial plan to his clients. His solution was to build custom dashboards for each client, visualizing their personal data and allowing them to access any detail of their financial plan with ease. 

How It Works


Before meeting with a client, Lucas sends them an adaptive questionnaire that allows them to fill out as much or as little information on their financial status as they would like to. From there, his team builds a financial dashboard that houses the information they provided, as well as the financial plan the firm has built for them. Over time, they add more information on every client, making their dashboard more and more robust. 

The complete dashboard replaces the need for a lengthy, printed financial plan that makes it difficult to find specific details. His clients are able to see their financial assets on a high level when they just want general figures, or they can dig down into any specific area to get full visibility into their wealth management status.

For example, a client can open their dashboard and check out a summary of their cash flow sources. If they want more information on a specific area of cash flow, they can click through and get details on every aspect, like salary, bonus pay, stock-based compensation, and more.

Camber’s immersive dashboards also include two key sections for client visibility: a “your control” section and an “our control” section. The “your control” section allows clients to visualize the aspects of their financial plan that they can directly control. How much should they save over the next five years? How caught up are they on their RSP contributions? If they follow the steps recommended by their financial planner, how will it affect them in the long run? 

The “our control” section allows clients to clearly see the things their financial planner is controlling. Things like asset allocation and diversification are displayed in a way that makes it easy to see the contribution the planner is making to the client’s financial wellbeing, forming a stronger client relationship over time. 

Hint: Do you struggle with collecting financial data from your clients? Consider allowing them to provide only the information they can easily access and then make their plan more specific over time. The less they have to do, the more likely they are to convert.

Client Response


Lucas says the response he has gotten to Camber’s dashboards has been overwhelmingly positive. His clients feel like they are able to participate in important conversations about their financial health because the data is presented in a manageable way. The dashboard is like a custom search engine for each client to be able to quickly access answers to common financial planning questions, allowing them to make more informed financial decisions leading to better long term outcomes. 

How Camber is leveraging data to combat low conversion rates in the financial industry


A key issue Lucas is focused on is the low conversion rate in the financial planning industry. Why are potential clients abandoning the process of developing a financial plan? In the hopes of solving industry problems such as this one, Lucas started a data science division at Camber, which works with students at the University of Calgary to fill in the blanks using survey data.

Reported spending habits from clients are often guesses; no one keeps track of every dollar they spend. To tackle this discrepancy, Lucas’s team uses microdata files containing surveys of large groups of people to estimate spending data based on parameters such as age, income level, gender, family size, and more. 

Using these findings, he is able to communicate comparative data to his clients to give them an understanding of how they match up to their peers. Are they spending more money than the average person of their age? Are they spending less money, setting them up for a stronger financial future? This allows people to fully understand their financial status and encourages them to make smart decisions to keep up with the pack.

The importance of client education and continuous marketing during times of financial instability


In the midst of the Corona Virus pandemic, clients want to know how the changes in the market are going to affect them. Lucas has found that his client base has stayed calm during this time of market volatility. He credits this to Camber’s dedication to keeping clients informed with their dashboards. 

With stress testing displayed in an easy way, clients are able to visualize their worst-case financial scenarios, helping them to understand that in most cases, they will be okay despite market downturns. Lucas stresses that times like these are not anomalies, but are to be expected when investing. “It’s not a bug in the market, it’s a feature of the market. The market doesn’t always go straight up”. 

For financial planners, Lucas sees this time as an opportunity to focus on their marketing efforts. While some people are taking a break from promoting their firms, the practices that focus on marketing will come out of this crisis ahead of their competition. He advises making a push towards digital marketing, setting yourself up for success once this is over.

Hint: Want to learn more about attracting new clients despite the COVID-19 crisis? Check out our episode with best-selling author and marketing expert Allan Dib. 

To hear more about Lucas, like why he made the switch from environmental chemistry to asset management and how Camber is overcoming technological challenges, listen to the full episode using the link on the top of this page. Make sure to subscribe on iTunes or Stitcher so that you never miss an episode.

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055: Practical Ways to Keep Improving your Skills as a Financial Planner

Practical Ways to Keep Improving your Skills as a Financial Planner

In theory, everyone wants to constantly be improving their financial planning skills, but what does it mean to put that into practice? Today’s guest is a relatively new financial planner who has already achieved more than many who have been in the industry much longer. He’s here to share his proven methods for improving his craft.

Zak Smith is the Senior Manager of Financial Planning and Wealth Strategies at Sagium, an independent wealth management firm in Calgary. He is a founding member of the newly formed Financial Planning Association of Canada and volunteers his time as a mentor for the Mount Royal University business department as well as with the CPA Financial Literacy Program. His recent successes include being named the 2019 winner of the PlanPlus Canada Financial Planning Awards, and 2nd runner up of the PlanPlus Global Awards program for the Americas region. 

Listen in to hear Zak talk about how feedback and competition make him a better financial planner, how he’s helping clients through the recent volatility in the markets, and what it’s like to serve clients as a team.

What You’ll Learn in This Episode: 

  • What made Zak switch from accounting to planning (3:20)
  • Zak’s typical process for clients (6:00)
  • How Zak prepared clients for volatility in the markets (11:30)
  • How feedback and competition make Zak a better financial planner (15:05)
  • The challenges Zak encounters in his practice (23:45)
  • How Zak’s team can provide a personal touch while working as a group (30:30)
  • How Zak applies different perspectives to his work (34:15)

Links and Resources:

Zak Smith

Sagium

Why Financial Planning Software Doesn’t Make Advisors Faster

Quotes by Zak Smith:

“Whether volatility exists now or in the future, we know it’s going to happen.”

“I was always cognizant that hey, is there any metric to what we actually do in this industry as far as a standard for what we’re delivering to our clients?”

“Clarity became the utmost piece in developing our plan reports so that it just made the conversation a lot easier with the clients.” 

Zak is unique as a guest on this show: he’s only five years into his career as a financial planner, and he doesn’t run his own practice. And yet, he’s built into his career ways to constantly improve himself as a planner. So whether you’re just starting or have been doing this a long time, and whether you run your own firm or not, you can draw from his experience and find ways to build on your skills.

Below, we’re sharing three key ideas from this episode:

  • How Zak prepared clients for volatility in the markets
  • How feedback and competition make Zak a better financial planner
  • How Zak applies different perspectives to his work

For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above.

How Zak prepared clients for the recent market volatility

Market volatility has been on all of our minds recently, and financial advisors are at the front lines of questions from clients about what they should do. Do they stay the course? Pull out as quickly as possible? Take advantage of low stock prices?

But Zak has seen fewer questions from clients than he would have expected, and he credits that to the stellar process his firm has when planning for clients. They engage clients in the process right from the beginning and make sure their clients understand that downturns and volatility are just part of the process.

Specifically, they use planning software to actually show clients what kind of volatility can exist in the markets and how it might affect their financial plans — so when clients see it happening in real life, a lot of the fear and confusion just doesn’t happen. Zak makes sure they know what the plan is and how they’ll be looked after no matter what’s happening in the market.

Of course, if clients do have questions, Zak’s team welcomes the conversation. But at no other time has the value of the process been more clear to Zak because he can see firsthand how much comfort their process has provided clients in uncertain times.

Hint: For another perspective to help you guide your clients through a difficult market, listen to How to Measure Client Progress Effectively (Even If Markets Decline) with David Christianson.

How feedback and competition make Zak a better financial planner

Anyone can learn from Zak’s (so far) short but successful career as a financial planner. In particular, he’s been very committed to improving himself as a planner, which has helped him achieve recognition in the field already. But more importantly, it’s made him able to provide a better service to clients.

External feedback

In 2019, Zak won the PlanPlus Canada Financial Planning Awards and was the second runner up in the Americas region for the global awards.

While the accolade is a major honour, Zak simply entered the competition because he wanted to see metrics and a standard for what he was delivering to clients. He had the sense that his team’s process was excellent, and his clients and colleagues seemed happy, but he wanted a panel of industry experts to look at what he was doing and give him feedback on what he could improve.

Before he entered the competition, he took a few years to evolve the process and plan reports with his team until he felt comfortable asking for that external feedback in the form of the competition.

Internal feedback

Zak’s passion for feedback doesn’t only come out in prestigious competitions, though.

It starts in his office, where he and his team do the planning for all of the firm’s clients, whether they’re looking for investments or insurance. Zak and his team do a lot of diverse financial plans, so they can’t always be in the room when those plans are presented to clients.

As a result, they rely on frequent discussions both among themselves and with the advisors at the firm to make sure their plans are working for clients. Zak’s door is always open to colleagues who have an idea to streamline the process, bring more clarity to plans, or improve the client experience.

More formally, they also meet at least once a month to debrief with the advisors and generate ideas for how they can improve the plans. This built-in opportunity to discuss and offer one another feedback is the foundation of Zak’s success as a planner.

How Zak applies different perspectives to his work

Since Zak is still new to the industry, he relies a lot on hearing others’ perspectives and learning from others’ experiences. Podcasts in particular have been a big source of learning from him, and he tries to keep an open mind to different ideas and points of view.

Some of his industry-specific favourites include:

  • Michael Kitces’ Financial Advisor Success Podcast — a well-known classic.
  • Jason Pereira’s Fintech Impact — a friend of the show who focuses on technology and how it impacts the industry.
  • XYPN Radio — a US-centric show. But since the US seems to be further ahead in terms of industry changes, Zak finds this one relevant in terms of learning how he can adapt and service the next generation of clients.

One additional step Zak recommends is reaching out to people after consuming their content. When he has questions or just really connects with what someone writes in an article or says in a podcast, he isn’t afraid to reach out to connect and learn more from them.

Hint: Zak emphasizes that the most important part of learning from others is having a good filter. Everyone has different needs and contexts, so make sure that when you apply others’ ideas, you filter out what doesn’t work and shape the rest to your situation.

To hear more from Zak, like how his accounting background has informed his planning career and why he’s obsessed with clarity, take in the full episode, which you can find right here on this page. Or better yet, subscribe on iTunes or Stitcher so you don’t miss any episodes. 

To get new episodes directly to your inbox, you can also sign up for our mailing list below.

 

054: How to increase the value of your financial advisory services by educating your clients

How to increase the value of your financial advisory services by educating your clients

When it comes to the question of how open to be with clients, at what point of the spectrum do you fall? Do you teach them enough that they feel invested in the plans that you build? Do you bore them to tears with lectures about the industry that have nothing to do with them? Today’s guest has found the balance between transparency and relevance, and he’s here to show you how you can increase the value of your service for your clients.

Sasha Djurdjevic, CIM, FMA, DMS, is a portfolio manager serving global private and institutional clients at his firm, River Wealth. He has extensive capital markets experience and has held senior investment roles at prominent investment companies in Canada. Listen in to hear what Sasha has to say about his educational approach to financial planning, his tricks for communicating complex ideas to clients in a way that’s relevant to them, and how he balances his business with raising four children.

What You’ll Learn in This Episode: 

  • Sasha’s unusual niche (6:40)
  • Sasha’s 70% rule for financial planning (13:10)
  • How Sasha acquires clients who live abroad (20:00)
  • How Sasha uses idea generation to communicate complex ideas to clients (24:20)
  • The value of transparency and openness (28:05)
  • How Sasha balances running his practice with his personal life (38:20)
  • Why it’s important to know yourself as an independent advisor (46:10)

Links and Resources:

Sasha Djurdjevic

Aligned Capital Partners Inc.

Quotes by Sasha:

“Trying to bucket people, and say that if you’re a non-resident you have these unique issues, is useful to a point, but the reality is that every client is different.”

“Help people to understand the context a little more, and you’ll end up with a more satisfied or self-actualized client, who then will value your work more highly.”

“Instead of trying to come up with a perfect plan, come up with a plan that does a pretty good job of reflecting what’s in front of you and what you know, then put your full effort into that plan.”

With Sasha’s experience working with a mix of institutional, retail, and global clients, he’s had to shift contexts, meet people where they’re at, and translate difficult concepts into learning opportunities relevant to each unique client.

Below, we’re sharing three key ideas that he’s imparting to you:

  • How Sasha approaches educating his clients
  • The value of transparency and openness
  • Sasha’s 70% rule for financial planning

For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above.

How Sasha approaches educating his clients

When Sasha first started serving retail clients, the biggest challenge he had coming from working with industry clients was the amount of hand-holding he felt he had to do to help people understand their financial situations and the work that he does.

He was used to working with people who knew as much as, or more than, him about finance. But with retail clients, he knows so much more about the topic, and numbers are so much more a part of the way he thinks, that he found it difficult at first to relate to where his clients were coming from.

He realized that as an advisor, he can ask all of the right questions… but his clients will still not necessarily know the answers. They may have a basic idea of what they want and what they can do with their money, but they don’t really know what’s possible.

But he also didn’t want to take client education in the other direction — some advisors give a lot of information to their clients, but that information isn’t relevant to the specific person they’re talking to. Without a focus on the client and their objectives, an overload of information is useless and overwhelming.

Sasha has learned over time to find a balance between the two extremes. He spends time dialoguing with clients and making them part of the planning process. Within it, he finds opportunities to integrate education about their contexts.

In these conversations, he helps open their minds to what they can do in their situations — thus helping them achieve goals they didn’t even know were possible.

The value of transparency and openness with clients

Hand in hand with education comes transparency — and Sasha likes to take the time to explain to his clients how the industry works. He doesn’t teach them the full nuance; rather, he gives them enough context to help them understand their place within it.

Transparency doesn’t specifically produce revenue in itself — instead, Sasha’s reasoning behind it is that it purely benefits the client. Hopefully, that means more business for him, but the goal is never to extract as much revenue as he can from people. The outcome he’s looking for is that the client is informed and happy.

“Help people to understand the context a little more,” he explains, “and you’ll end up with a more satisfied or self-actualized client, who then will value your work more highly.” And when they value your work, they are willing to pay for that value.

Hint: To hear from an advisor with a commitment to radical transparency, listen to our episode on building and managing a successful investment firm. You’ll hear from Steadyhand’s Tom Bradley about his “obscenely transparent” practices and how you can apply them in your business.

The taboo topics

A commitment to transparency means breaching the taboo topics of fees and benchmarking. There’s a common misconception that discussing these topics has a risk of poor optics for the advisor — what if you’re underperforming the benchmark? What if someone else has a lower fee? (And let’s be honest: there will always be someone out there with a lower fee.)

If you’re avoiding these topics, clients will feel like you have something to hide. And if anyone does ask you about them, you’ll feel thrown off and uncomfortable answering their questions. If you address these topics head-on, though, your clients will feel that you’re being open and honest with them, and they’ll trust you more for it.

Hint: A great question to ask potential clients is, “what have your conversations about this (fees benchmarks, or whatever else) been with your past advisor?” Unfortunately, most clients won’t have an answer because their advisor won’t have discussed these things with them — automatically making you look like a more trust-worthy, valuable choice.

Sasha’s 70% rule for financial planning

Sasha feels that the financial plans he creates for his clients are more general than what many other advisors do.

One reason for this is that people’s predictive abilities aren’t very good; most people can’t reliably tell what their lives will look like in the future. And that makes sense — there are so many variables to consider that it’s impossible to know what the future will bring. 

Especially with younger clients, there is always time to adjust the plan, and a lot of control over your strategy. It just doesn’t make sense to put in every little detail and obsess over little things 30 years from now that you are still able to change in the meantime.

Hint: Not only is too much detail not very useful, it often bores clients. If you fill your financial plans with information that isn’t meaningful to them (and a lot of numbers they don’t understand), they won’t feel as invested in the plan and will be less likely to stick with it.

When it comes to financial planning, Sasha applies a rule used by the US Marines: the 70% rule. In imperfect situations — like a battlefield or, let’s be honest, life in general — don’t aim for a perfect plan. Instead, aim for a plan that’s 70% there. If you have 70% of the information you need, 70% of the possible implications of your plan and 70% confidence in its accuracy, that’s a great start.

And that’s the caveat — it’s a start. Put your full efforts into the plan, with the full understanding that you will adjust it continually as you learn more information.

Catch the full episode to hear from Sasha about how he works globally while thinking like a local business and why as a business owner, the first thing you need to understand is yourself. You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. 

And to get new episodes directly to your inbox, sign up for our mailing list below.

053: Building a Referral-based Financial Advisory Practice

Building a Referral-based Financial Advisory Practice

Financial advising is a profession that draws in an eclectic mix of individuals who come from different backgrounds and whose career paths haven’t always been straightforward and predictable. Today’s guest formerly served in the military as a forensic accountant; now he not only runs his own financial practice, he’s also the world’s first (and probably only) forensic accountant blockchain professional. He joins the show to share what he’s learned from his military experience that has helped him serve his clients and grow his practice on referrals alone.

Robert Watterson is the owner of Watterson Financial Solutions, a firm that handles financial planning, accounting, compliance, insurance, asset protection and tax services. Listen to hear what Robert has to say about how working in forensic accounting informs his current work, how he remains focused with so many different areas of practice, and how his interest in blockchain technology helped him develop an audit-ready bookkeeping system.

What You’ll Learn in This Episode: 

  • How Robert moved from military forensic accountant to advisor (5:00)
  • How his military experience informs the way he acquires clients (9:10)
  • Staying focused while providing different offerings (18:40)
  • How the different parts of Robert’s business build on one another (21:40)
  • The blockchain’s impact on the financial industry (23:40)
  • Robert’s audit-ready bookkeeping system (30:30)
  • Robert’s biggest challenge in growing his practice (35:10)
  • Why service is the most important part of running a practice (38:00)

Links and Resources:

Watterson Financial

Send Robert an email

Quotes by Robert:

“In the military, one of the things that they taught us was never look for what’s good for you; look for what’s good for the overall project you’re working on. And if you’re working with a client, that means the overall good for the client.”

“Make yourself referable… If you are referable, they will come back to you for work or they will have somebody come to you for work.”

“If you don’t worry about making money off every client, the client will worry about making sure you make money.”

With Robert’s different interests and areas of expertise – forensic accounting, blockchain technology, compliance and financial planning – it can be difficult to see how everything fits together. And yet, he’s able to pull knowledge and skills from different areas to create a unique practice in a way that we can all learn from.

  • How Robert’s military experience informs the way he acquires clients
  • Robert’s obsession with learning
  • Robert’s biggest challenge in growing his practice

For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above.

How Robert’s military experience informs the way he acquires clients

In the military, there is a high emphasis on sharing information freely and looking out for the team. Robert had to make sure that if he was injured or killed during an assignment (yes, the stakes were that high), somebody else still had the knowledge and skills to do his job. As a result, he is used to an open culture of constant teaching and learning.

He explains that “in the military, one of the things that they taught us was never look for what’s good for you; look for what’s good for the overall project you’re working on. And if you’re working with a client, that means the overall good for the client.”

Robert feels deeply that his job is to help people, and he’s never afraid to give his time freely to people without expecting anything in return. At the large insurance firm he worked at, he often took on the clients and cases nobody else wanted because they didn’t come with obvious financial gain for the advisors.

People did tell him that if he did this, eventually clients would come back to him. And while that’s not why he helps people, the prediction was correct.

That’s the irony of good service – when you don’t look at how much money you can make and focus instead on helping people, financial success often follows as a result. In fact, Watterson Financial Solutions no longer advertises their business at all – they can’t because they have so many referrals coming through.

Robert summarizes the approach like this: “Service your client. Give them the information they need and don’t worry about making money off of them. If you don’t worry about making money off every client, the client will worry about making sure you make money.”

Robert’s obsession with learning

Another aspect that Robert brought from the military into his advising is his ability to learn. In the military, he would have to learn about projects (and the associated knowledge and skills) quickly and expertly – when investigating other countries or protecting against financial warfare, a mistake could cost him his life.

As a civilian, Robert has maintained a hunger for knowledge. He isn’t a dabbler – if he’s going to proceed with something, he needs to know everything he possibly can about it. He certainly doesn’t feel comfortable advising people on anything he doesn’t fully understand.

For example, he recalls that his team once spent 18 months looking into a new investment before ever mentioning it to a client – he wanted to be sure he thoroughly understood everything there was to know about it first. He certainly refuses to do things halfway.

Similarly, he realized early on that blockchain technology was going to transform the financial industry. When he found out that post-secondary schools were beginning to offer courses and degrees in blockchain, he took one of the first offerings available in North America and became the first (and still only) forensic accountant blockchain professional.

With or without Robert’s military background and remarkable ability to absorb and understand new information, you can apply his principles about learning to your advising. Your clients expect you to be an expert in your field – make sure that’s what you deliver. Own your expertise and be aware of your limitations so that you can address them and serve your clients to the best of your ability.

Hint: To hear more about the importance of learning throughout your career, listen to our episode on improving your practice through professional education with Jason Watt. 

Robert’s biggest challenge in growing his practice 

Robert says that the biggest challenge in his career has been always wanting to already be at the next higher level.

For example, when he left his insurance company, the company’s regulations stated that he couldn’t take his 700 clients with him; he had to walk away from relationships he’d built over years and begin rebuilding his client base.

Robert has been learning to feel comfortable with the level he’s at right now even as he strives for more, and channeling his frustrations to fuel his motivation.

Hint: If you’re feeling frustrated about your practice’s growth (or lack thereof), keep in mind that running a business is not a sprint by any means. Listen to our episode on predictably growing your practice with systems, tools, and referrals for suggestions from John Page on where to focus your efforts to build a sustainable business.

Make sure you catch Robert’s full episode to hear more, including his early involvement in blockchain technology and how it informed his audit-ready bookkeeping system (yes, it really is audit-ready). You can find the show right here on this page or subscribe on iTunes or Stitcher so you don’t miss any episodes. 

And to get new episodes directly to your inbox, sign up for our mailing list below.

052: A Smart Approach to Balancing Risk and Return for Your Clients


A Smart Approach to Balancing Risk and Return for Your Clients

Higher returns often mean higher volatility — so how do you know when it’s worth it to be more aggressive and when you should settle for a lower, but more stable, return? And how can you help clients trust that you’re taking the right approach? Today’s guest is always thinking about risk and return and has a framework to help you balance the two.

Martin Pelletier is a portfolio manager and managing director at TriVest Wealth Counsel, a division of Wellington-Altus Private Wealth. He is a Chartered Financial Analyst (CFA) charterholder and has extensive investment industry experience, including senior roles in capital markets, private banking, venture capital, wealth management, and family and multi-family office.

Martin is regularly featured in the media and is a weekly contributor to the Financial Post’s Investment Pro section. He is a member of Thomson Reuters Canada’s top 40 social influencers in finance, innovation and risk (2017), was a top-10 finalist for the BlackRock Award for Canadian Portfolio/Discretionary Manager of the Year (2018) and was recently named to Wealth Professional Canada Magazine’s Leading Portfolio Managers (2019).

Listen in to hear what Martin has to say about risk, return, and the foundation of his success.

What You’ll Learn in This Episode: 

  • How Martin (accidentally) avoided the financial crisis (2:05)
  • How goals-based benchmarking removes unnecessary risk (6:25)
  • How asset management differs between high net worth and ultra-high net worth clients (12:30)
  • Building trust at scale (17:00)
  • How thinking big and building small has contributed to Martin’s success (21:55)
  • How advisors need to reposition themselves to succeed in a changing industry (28:20)
  • How Martin has eliminated the most challenging aspect of his business (33:40)
  • Why he thinks you should never get comfortable (40:40)

Links and Resources:

TriVest Wealth

Martin Pelletier

Email Martin

Quotes by Martin: 

“With ETFs coming out, it’s democratized the investment industry, and commoditized it.”

“It’s all about building relationships. The number one reason why someone’s going to decide to go with you is trust.”

“If you really want to impose change, you have to think big and build small.”

Martin Pelletier’s financial advice is sought after both by the media, and high and ultra-high net worth families. Today, he’s sharing his expertise with us.

Below, we’re sharing three key ideas from this episode:

  • How goals-based benchmarking removes unnecessary risk
  • How asset management differs between high net worth and ultra-high net worth clients
  • Building trust at scale

For the rest of the episode, find the podcast on iTunes or Stitcher, or hit the link above.

How goals-based benchmarking removes unnecessary risk

It’s pretty clear at this point that the value proposition of financial advisors needs to change — with technology and new products making do-it-yourself investing easy and inexpensive, advisors have to offer something more.

For Martin, that something more is a holistic planning solution that tailors investment portfolios not to an index, but to a client’s specific goals.

Every investor has a goal they want to achieve, whether it’s retiring in five years, travelling, spending their time volunteering, or working part-time. Martin starts by understanding what it is his clients want to achieve.

Next, he derives a cash flow statement and comes up with a target return. Finally, he designs a custom portfolio and structures it to provide that return.

If a client needs a 5% rate of return to achieve the lifestyle they want, there’s no reason to have a more volatile portfolio. Beating, or even matching, an index isn’t the point — the point is meeting the client’s goals while minimizing risk

Client reactions

You may be reluctant to try this approach with your clients because you’re worried about how they’ll react. Wouldn’t anybody want to squeeze as much out of their portfolio as they can? Why settle for a 4% or 5% rate of return when you could shoot for 7% or more?

Martin hasn’t found that to be an issue. First of all, he interviews prospective clients to ensure they’re a good fit for one another, and this is one thing he looks for — if someone is trying to outperform the market, they aren’t the right client for him. And once his ideal clients get to know him, they trust him to focus on their specific goals rather than beating some kind of average.

Hint: To hear from another advisor who personalizes portfolios to his clients’ goals, listen to our episode with Peter Cishecki on the one change you can make to your practice to really put clients first.

How asset management differs between high net worth and ultra-high net worth clients

With most of his clients’ AUMs falling between $1 million and $20 million (with one family at $500 million), Martin’s specialty is around the high and ultra-high net worth segments. And while the two might seem similar, Martin has found a big difference between managing $1 million and $20 million portfolios.

With more assets, he’s able to introduce more unique investment products, like private equity. That often doesn’t make sense to someone with $1 million — you often can’t invest a meaningful amount while keeping the portfolio weighting reasonable. Just $100,000 is a full 10% of their portfolio, and the risk can be too big.

That’s not to say that a high net worth client can’t have a well-diversified portfolio or achieve similar goals — of course they can. The process might just look different.

And the ultra-high net worth clients don’t just allow for more customization — the sophistication of their profile often demands it. Typically, they have far more complicated financial situations, with cross-border companies, unique compensation structures, assets in various currencies, and multiple holding companies. As such, the planning needs to be more in-depth and personalized.

Building trust at scale

When it comes to marketing himself and acquiring clients, Martin gets right to the heart of the matter. “It’s all about building relationships,” he says. “The number one reason why someone’s going to decide to go with you is trust.”

And with social media, you can start building trust before even meeting a prospect by creating and sharing good quality content online.

You might worry that writing down and sharing your best advice and tips is giving away your secret sauce. Sure, there will always be people who will read your work and apply it themselves — but those aren’t real prospects because they aren’t people who want to work with an advisor anyway. The clients you are targeting are people who want you to manage their money for them, not people who want to do it themselves.

Martin has been a longtime contributor to various media outlets, including a weekly column in the Financial Post. But with social media, you don’t need a platform like that to reach potential clients — you can provide good quality information straight to your own audience.

Hint: Whatever information you want to convey, make sure you connect it with something topical — something in the headlines or that your audience is already thinking about. You can have the most important advice in the world, but if it doesn’t grab their attention or seem relevant, they’ll never read it in the first place.

To hear more from Martin about his practice, the habits that have made him successful, and how he managed to neutralize the most challenging aspect of his business, listen to the full episode. You can find it right here on this page or subscribe on iTunes or Stitcher so you don’t miss any future episodes. 

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