The battle for client retention is won—or lost—within the first two years of acquisition, according to a recent article in ThinkAdvisor. The article’s author says that out of their typical yearly client attrition rate of 7%-10%, they discovered that 45% of these clients were leaving within the first two years of coming on board. Implementing some simple customer service and support models and processes reduced their account closures.


Keeping even just a fraction of that business can mean a lot to a financial advisor’s bottom line. The author found that “a simple 2% increase in customer retention can create as much revenue as decreasing operational costs by 10%.”


Here are six key takeaways you can implement in your practice:


  1. Return phone calls and emails promptly.*
  2. Reach out proactively to provide good ideas and advice—don’t just wait for your clients to call you.*
  3. Create a financial plan for your clients and use it as part of your model for customer service and support.
  4. Track goals and provide progress reports. You can’t stop “selling” the value you bring to a client, especially during the first two years.
  5. Assess risk tolerance accurately, especially when dealing with couples who might have different viewpoints, and use that risk tolerance to explain investment returns.
  6. Manage expectations. Define your role as a financial coach and educator, with the goal of training your clients about investment performance.


* “According to a study conducted by The Spectrem Group, the four most highly cited reasons that investors worth between $1 million and $5 million leave their financial advisors are service related, which include not returning phone calls (61%); not proactively reaching out (53%); not providing good ideas and advice (48%); and not returning emails in a timely manner (46%).”


If you are wondering how you can reduce potential client attrition, contact Quantum at 800-440-1088 for ideas on improving and formalizing your client experience.


Source:  Think Advisor. “4 Ways to Keep More Clients.” July 13, 2017. (accessed July 17, 2017).




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