Skills Financial Planners Need to Succeed Today

Critical skills financial planners need to grow their business include good communication and flexibility.
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What skills will financial advisers need to succeed in the current environment?

According to a poll published by the AICPA, the top three most cited skills planners will need, in addition to technical skills, are emotional intelligence, interpersonal communication and adaptability.

What sort of technical skills are required?

“While I certainly agree that financial planners will need emotional intelligence and need to be skilled at interpersonal communication and adaptability; I also feel that there are two areas of technical skills that planners need to focus on, said Kathleen Pritchard, director of practice management at John Hancock Investment Management.

The first, she said, is retirement income planning. “Given the current demographics of advisory clients, this is more important than ever before,” said Pritchard. “Financial planners need a defined retirement income process that they can share with their clients so that their clients can feel confident in the strategy.”

Another area where I see very few planners focusing is longevity planning, said Pritchard. “This goes way beyond long-term care insurance,” she said. “It means educating your clients on everything from the costs of senior housing to caregiving expenses to elder abuse and fraud and helping them make decisions as to how they will navigate and pay for these things.”

These life transitions, Pritchard said, can easily blow up carefully crafted financial plans if they are not accounted for. “Longevity planning also provides financial planners a great opportunity to showcase their value to the entire family and build critical intergenerational relationships,” she said.

In addition, the AICPA and other experts identified many keys that make for a successful financial planning practice:

Core Values and a Core Purpose Are Essential

“Culture matters now more than ever,” Michael Goodman, CPA/PFS, president of Wealthstream Advisors, said in the AICPA release. “Successful firms need a set of core values and a core purpose that embody the essence of why they exist. Leaders who invest the time to create and sustain a positive firm culture experience more growth, attract the best talent, and provide better client service. Being able to articulate firm values to prospective clients, as well as when recruiting employees, is so important. Your firm’s culture is also a unique opportunity to differentiate yourself from others.”

Mentoring New Staff

According to Tim Steffen, an adviser education senior consultant with PIMCO, advisory firms are now having difficulty mentoring new staff and building a firm.

“We saw it with interns last summer -- many of whom never spent a day in the office with their co-workers,” he said. “This work from home (WFH) thing has a lot of advantages, but the difficulty in building strong relationships within a team, or providing mentoring and training, has been a real challenge.”

Firm culture, he said, is quickly diluted when we no longer have those shared experiences within an office - each person's idea of what it means to work for a company is different because our experiences are all different. “I don't think anyone expects WFH to continue to be a five-day-a-week thing forever, but we're not going back to where everyone is in a full-time office setting, either. Firms will have to figure out to develop staff, as well as create and maintain a common culture when we're not altogether all the time. It will be a real challenge. Firms that aren’t able to do this will find they’re more likely to lose staff to firms that are able to manage it.”

Refine and Grow Your Business

“An interest and curiosity to constantly refine and grow the business is a tremendously important skill/attribute as well,” said Sterling Shea, head of practice strategy Morgan Stanley.

“For advisers to do their best work on behalf of clients they must have a resilient, stable business,” he said. “Those practices that are most likely to deliver exceptional outcomes for clients are growing, profitable and flush with resources. In turn, adviser practices that are struggling, unprofitable, and unable to reinvest in the business are likely to produce less than optimal results for clients, I believe.”

Maintain Client Engagement

Maintaining client engagement has been shown to be the key to keeping strong relationships, said Steffen. “A lack of engagement is usually top of the list of reasons why clients leave an adviser,” he said. Read Here's Why Clients Fire Financial Advisors.

In an environment like this, where face-to-face meetings can be difficult (at best), Steffen said advisers need to make the extra effort to stay engaged with clients. This is especially true for older clients (who tend to be the biggest and best clients) - they are less likely to be comfortable with online meetings, so advisers have to be extra diligent in finding ways to keep in touch with those clients.

Support Clients Through Changes

“In light of the pandemic, many clients find themselves reevaluating their most important life choices,” Jean-Luc Bourdon, CPA/PFS, a wealth adviser with Lucent Wealth Planning, said in the AICPA release. “Helping them go through this process enables advisers to have a deeper understanding of what is critical to them and how to structure their plans accordingly.”

What’s more, Bourdon stated that providing exceptional financial planning services goes beyond knowing the numbers. “There is great value in understanding a client’s evolving life goals and what they truly want their money to be able to do for them,” he said.

Client Perspectives and Motivations 

According to the AICPA release, advisers can also encourage clients to uncover and efficiently express their charitable intentions. “Speaking with a client about their personal experience allows you to understand the motivations behind their charitable pursuits,” Sue Stevens, CPA/PFS, a wealth adviser with Buckingham Strategic Wealth, said in a release. “Whether it is honoring a deceased partner or being involved within their local community -- it’s important for you to help them uncover and establish meaning to where they put their money.”