THE COALFACE: My biggest mistake revealed

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Hugo Sampson, financial adviser and authorised representative of Advice Evolution, shares his insights with Wealth Professional.

What do you believe are the key areas of value you provide your clients?

There are three key areas in which I provide value to my clients: needs-based advice, educating the client and client contact.

1. Needs-based advice

Good financial advice can significantly change people’s lives. One of the key areas in which I provide value to my clients is to provide needs-based financial advice. I do this by actively listening to my clients to gain a deeper understanding of their individual situations and their goals in life. I take a holistic approach to advice by advising in the areas of SMSF, superannuation, investment, personal risk and tax minimisation. 

I work by the mantra ‘clarity of goals with meaningful outcomes’, meaning that I work with my client to reach a tailored solution for each of their important life stages, whether it be retiring by a certain age or starting to build a nest egg for their children. I do this hand in hand, in an informative, easy to understand, and engaging way.  

I don’t believe advisers can simply ask how much a client has to invest and then put them into a product. The client must always come first. My advice is tailored to ensure that the client receives maximum benefit to suit their needs and I find that this ultimately leads to a closer client relationship and most rewardingly, can significantly change people’s lives.

The practice in which I work sublets our office space to a number of other practices including an accountant, general insurer and a mortgage broker. If I believe a client would benefit from advice in one of these areas, I will often refer them to that partner.  We work on a no-commissions basis but we trust our referral partners to treat our clients like family. To be able to refer our clients to a trusted source that we send our own family to is a rare thing.

2. Educating the client

Financial advice can be complicated. My aim is to help a client recognise their current financial situation and understand what steps can be taken to improve their financial standing and reach their goals in life. In this way, I am education and empowering my clients.

It is wonderful to have engaged clients who want to learn more and who come to you with ideas after you’ve helped them to understand why the recommendations you’ve made to them are best suited for their needs.

When I first met Roger, one of my long-standing clients, he did not know much about how best to structure his finances and what investment opportunities were available to him. He basically saw his investment value fluctuate but had no idea why it was happening.

By explaining to Roger why markets move, how we identify potential value-making steps and the risks associated with investment, our relationship has prospered and we now talk about complex strategies which he understands.

Recently, Roger sent me an email briefly explaining why he valued the investment strategy we had devised. He was pleased that his allocated pension was receiving a tax refund based on hybrid income payments and he understood the tax effectiveness of having an allocated pension. It was clear that he knew why he had received a refund and most importantly he understood our investment strategy. 

He also understood why his investment in ASX code IVV (S&P 500) had performed the way it did and how, by investing an amount that is exchanged for American dollars, he can capitalise on the increase in the US market and improvements in the US/AUD exchange rate. 

For the average investor, like Roger, to understand these two investment strategies, I think is a fantastic progression in their knowledge.

I am pleased that Roger trusts the advice I provide and appreciates the way in which I have helped to educate him on financial strategy so much so that he had the confidence to refer a family member to me for financial advice.

3. Client contact

The third key area in which I provide value to my clients is ongoing client contact.  In my practice we love to let clients know we care by sending a big vase of lollies when a client turns 55 and 60 to promote TTR, sending a couple of gold class tickets if they have referred a client to us, and sending handmade cards on their birthdays, which come with a phone call to check on their day so far.

In addition, our practice sends clients monthly newsletters, notifications when relevant legislation changes happen and a couple of review opportunities per year. Clients may not necessarily need you all the time but I believe I’m in contact just the right amount to keep them informed and interested so that I’m their first port of call for advice.

What has been your biggest mistake, and lesson learnt, in the last 12 months?

The biggest mistake I’ve made in the last 12 months was not asking existing clients for referrals.  I found it difficult to ask and didn’t really know how to approach the topic.

After discussing this with a number of advisers from our office and other colleagues in the industry, consensus was unanimous; you just have to ask the question.

Without a doubt in my mind there is absolutely no better and a more trusted person than satisfied clients to help promote your business by referring their family and friends.

After educating and engaging our clients they feel more confident to discuss financial matters with close ones and this is usually a big step for our clients who previously may have felt unable to do so. 

All clients have friends their age and our aged-based financial strategies are the perfect starting point for clients to spread the word about how we’ve been able to help them use the advice of a financial planner.

Client referrals now amount to over 70% of the referrals I receive for planning advice.

  • Peter on 17/11/2012 9:45:16 PM

    Good to see you have got to the point where any good financial planner would be placed.Gifts to clients,to referral sources,regularly contacting clients,educating clients and asking for referrals from existing happy clients........great ideas.I think that I first saw most of them about 34years ago in a training manual for a Life Company. As they say Everything old is new again!!!

  • GAB on 16/11/2012 9:58:18 AM

    gee..if that's your only mistake, not asking for referrals, then you've had a great run.

  • Conservative accountant on 15/11/2012 3:31:50 PM

    What do you actually ask them?

  • Neil on 15/11/2012 11:14:15 AM

    This should come as no surprise. Its what should have been happening in the industry( and has been in many cases) for 25 years.

WP forum is the place for positive industry interaction and welcomes your professional and informed opinion.

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