As robo-advisors make a play for high net-worth (HNW) investors, you will need to step up your game in order to meet the changing expectations of your affluent clients. One way to make yourself irreplaceable to your clients is to offer investment plans based on their values.
“There’s a growing class of [HNW] investors who are looking to align their personal values with investment principles,” says Rebecca Mooney, vice president and head of brand and marketing at RBC Wealth Management in Toronto. “Their expectations have evolved, and they’re looking for more than monetary returns.”
Finding ways to appeal to these clients’ values often involves options such as socially responsible investing and philanthropy.
Mooney attributes this increased appetite for values-based investing to the changing demographic profile of the HNW client. A growing proportion of affluent clients are millennials and women, she says, and they are driving a growing emphasis on the social aspects of finance.
If you want to attract — and retain — this new generation of HNW clients, here are some ways you can appeal to their interests:
> Have a discussion about values
Most HNW clients may be focused on wealth preservation, but many also want to support causes that are important to them. To get a sense of how they hope to make an impact, Mooney says, get your clients to talk about “what they aspire to do with their wealth.”
Those discussions will not only give you a deeper understanding of what’s important to your clients; it also will reflect well on you, as someone who recognizes the value in giving back.
> Offer a choice
You can distinguish yourself from robo-advisors by letting your clients consider an array of options in choosing a plan. Avoid taking shortcuts by simply prescribing a single strategy. Instead, lay out several strategies, so clients can determine which one best aligns with their values.
Clients have different ideas about what it means to give back, Mooney says. Whether it’s the decision to leave a legacy by creating a trust or foundation, or launching a social initiative at their place of business, you can educate them on their options and connect them to the appropriate resources and experts.
> Arm them with information
Create packages of information that you can share with clients, based on what they may be interested in pursuing.
For clients who are interested in establishing a family foundation, for example, assemble information on the issues and steps to consider, along with an explanation on where you, as the advisor, fit into the equation.
“Emotional triggers” alone are not enough to persuade people to support a cause. “People make large gifts in the same way as they make investments,” says Maeve Strathy, fundraising strategist at Blakely Inc. in Toronto. “They want as much information as possible,”
Offer your clients information that educates them on how they can valuate the impact their investments or contributions can have.
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