BUILD YOUR FARM TEAM

According to Cerulli, $84 trillion of wealth will be transferred to the next generation through 2045.  And many of those people won't be keeping you as their advisor!

I have two questions for you…

1. What are you actively doing to prevent that money from leaving your practice when it transfers to the next generation?
2. What are you doing to prepare the next generation to be good stewards of that money?

The irony of our business is that we are obsessed with people who have money because that is how we make money.  The more the better!  Right!?  Maybe.

You could have an amazing book with $100 million under management that is dying a slow death of attrition.  That is a problem if you have many years left to work or if you would like to sell that book.  Valuations are now considering the average client age. 

THE GREAT WEALTH TRANSFER

A bunch of old duffers with a couple million apiece sounds good, but it isn't worth what it used to be…because of the inevitable Great Wealth Transfer.  We have been taught to chase the highest net-worth folks, many of whom are in their later stages of life and our success could be our undoing.

But let's say that you do hold onto many of those assets because the children choose to keep us as their advisor, are they prepared for the wealth they are inheriting?

It's very likely that they won’t be because no one wanted to work with them prior to inheriting wealth.  It's likely they would fall more into the Mass Affluent category vs. the High Net-Worth. They weren't the kinds of clients that advisors are chasing.

The best financial advisors have been too busy chasing whales to bother with these Mass Affluent clients.  If they interacted with "advisors" at all, they were probably product pushers and salespeople. 

How likely is it that these newly wealthy clients will be good stewards of their money when they have not had a trusted advisor relationship before?  

I would suggest that it is not very likely that they will be prepared for the wealth they will inherit…without your help.

But like most things in this business, once you understand the problem, you can build a process to solve it.

Rather than wait for the transfer and deal with the repercussions, you can build the relationship now and train them to be ready when the time comes.

I am not talking about working with NextGen clients on a one-off basis.  I am talking about making a concerted effort to build NextGen planning into your client service model.

NEXTGEN FINANCIAL PLANNING

You can build a cradle-to-grave business model that integrates you so deeply into your clients' lives that their children see you as their advisor decades before the transfer happens.  When they inherit, it will be just the next step on their journey with you, not their first step.

I am not much of a sports fan, but I think there is an apt analogy here.  You need to build a farm team for your professional league. 

All the money and the glory are in the pros, but you develop your next generation on the farm team.  You invest your time in them to help them develop into eventual pros.  Some will get to the pros on their own and some will only get there when their parents pass away, but either way, they will be ready to step up when the time comes.

Without a concerted effort on your part, you will be trying to take a high-school player and drop them into a professional league.  How well do you think they will do without the additional years of development?  #NotSoGood

ARE YOU PLAYING THE LONG GAME?

Regardless of where you are in your career at this moment, you need to be playing the long game. 

Younger advisors would be wise to integrate this farm team concept in early and build it over time.  More senior advisors may need to make a more concerted effort to build a relationship with the next generation.  This is a fantastic project for a junior advisor to bring value to your clients and your practice.

If you can see the writing on the wall and want to prepare for the Great Wealth Transfer, I invite you to join me for an upcoming live training I am doing called NEXTGEN CONNECTION. 

In this training, I will be outlining exactly how to design and implement your NextGen Planning Process to position yourself as their trusted advisor from the very beginning.

All attendees will receive…

• NextGen Connection Workbook
• NextGen Planning Process Visual
• Financial Foundations Agenda

The NEXTGEN CONNECTION is being offered as part of IMPLEMENTATION Monthly Mastermind which is a group coaching program designed for advisors who want to build process-driven and profitable Advice-Based Financial Planning practices that align with their values.

Click HERE to learn more and get one month absolutely free.  A credit card is required, but you can cancel at any time.  If you love it, stick around and you will pay only $100 per month for access to the archives and a monthly live training with me and other like-minded advisors.

I hope this serves you and that I get to see your face live on an upcoming IMPLEMENTATION Monthly Mastermind call!

-Lucila