Advisors need to determine where they can add the most value in helping clients achieve their financial goals. Surmounting this challenge is central to a successful business strategy.
When evaluating and explaining their own value, advisors should consider these five questions:
- How do we measure advisor value added?
- How can advisors better communicate their value-added message?
- Should advisors worry about the threat from online or “robo” services?
- How can advisors serve not just the wealthy, but also average folks?
- Which activities should advisors outsource?
I will offer some answers to those questions. First, I will define a categorized menu of the areas in which advisors can provide services. This particular menu focuses on the retirement stage, which requires a wide range of services.
General planning
- Affordability of retirement and when to retire
- Estimating retirement expenses
- Debt management, including credit cards, mortgages
- Social Security timing
- How to structure an overall plan, including systematic withdrawals, floor/upside or time segmentation (buckets)
- When to adjust spending as conditions indicate
Investment selection
- Individual stock and bond recommendations
- Stock and bond funds and investment manager recommendations (including choice of active or passive approach)
- Alternative investment recommendations
- Individual securities trading
Investment allocation
- Basic asset allocation, including matching the asset allocation to spending flexibility and adjusting the asset allocation for risk tolerance
- Strategic adjustments to allocations, both short term and long term
- Rebalancing
- Asset location decisions and withdrawal sourcing
See full article on Five Opportunities for Advisors to Add Value by Joe Tomlinson Advisor Perspectives
