The independent advisor today wears a lot of hats: business owner, boss, chief compliance officer, marketer, and, if there’s time after all that, advisor. Beyond the productivity problems, which are enormous, lies the simple reality that giving the ideal client the service they need goes impossibly far beyond the scope of services they’re able to provide. More than ever, the modern advisor needs a scalable platform to compete, win, and grow.
Making Magic Happen For Financial Advisors and Their Clients
When the scope of services provided by a professional is in total alignment with the needs of a well-defined cohort of people, magic can happen. The clients can get something they truly need, whether that be security, peace of mind, or something performance-related. And the professional also benefits: they earn a substantial income while taking great satisfaction from their work.
Financial advisors who haven’t taken the time to actually write down a series of services they offer their marketplace might find the following list useful in their marketing, because these are services that are much in demand in virtually every city and town in America:
- Reduce taxes legally
- Grow wealth through customized investments
- Protect assets from lawsuits, creditors, and public exposure
- Provide for future generations
- Create lifetime lifestyle security
- Support charity while getting tax benefits
Here are a couple of thought experiments for advisors: Are you interested in building or managing a book of business for people who don’t seek those benefits? Do you realize that once a person or a family has a need for these services, the need never goes away, no matter how wealthy they become?
The list above is common for everyone, from the mass affluent to the billionaire class. So here’s the real question: Is there any wealth management model or type of firm that provides these services more efficiently or transparently than a family office? Clearly, the answer to that one is “No.”
Why the Family Office Will Democratize
Now, here’s a really hard question: Do you provide those services under your direction to your clients? If you don’t, you can rest assured that the clients will find other professionals who will. They’ll go to their tax person, who may refer them to a trusts and estates lawyer, and one way or another, an insurance person will find them. People who have a need—not a want or a nice to have, but a need—will find a way to fill that need.
Many advisors know this already, and they build a network of other professionals in a referral network. They find an insurance person who (probably) won’t poach the client’s money management, an asset manager who can allocate and manage a suitable portfolio, a tax pro who can help them with advanced strategies, and a trusts and estates person who can help them structure, protect, and shield their assets.
Two obvious things make that approach sub-optimal: one, it causes the advisor to spend a ton of time running around herding cats, and two, they miss out on compensation for these other solutions. These two problems combine to crush their productivity and, therefore, their income. That’s what’s bad for the advisor.
The client gets a sub-optimal solution, too. Their advice is spread out across multiple firms and multiple personalities, who, in the real world, will all be trying for some measure of client control and influence. They’ll receive communications from multiple firms. Their inbox will be full of notices, privacy letters, compliance notices, newsletters, updates, reports, and so on, none of which will speak to the big picture of their overall financial situation, and most of which won’t come from the advisor.
In a family office structure, all of those problems disappear, which explains the popularity of the model among billionaires worldwide. Of course, it also explains the success of family offices. So, finally, now we come to the hardest question: If you could offer family office model benefits with none of the drawbacks noted above and create multiple streams of income for yourself while ensuring lifetime client loyalty, would you do it? If your answer is yes, there’s great news for you, because the family office has been democratized.
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Seasoned advisors know in their bones that they only get compensated for finding and developing relationships. Everything else is a cost, whether hard dollar or opportunity cost. An advisor who can bring to the table a complete suite of family office services will have a huge marketplace advantage and the great gift of personal productivity.
Financial Gravity, Inc. has created a firm to support the advisor who appreciates these realities, and sees the incredible potential in a first-mover advantage. With its comprehensive array of client solutions, including asset management, insurance, financial planning, tax strategy and compliance, legacy planning services and a client support team, plus agency-level marketing services, Financial Gravity can help set the advisor free.
Those services combine with Financial Gravity’s unique Done For You advisor success model, which aims to cover all the routine middle and back office chores. They also offer a host of Advisor’s Alpha services designed to shift the basis of competition from portfolio performance to value-added services. These include HALO™, a holistic asset location protocol, Real Risk Meter™, an empathetic, real-world risk tolerance platform, Incomize™, a retirement income solution that solves for all the major threats in retirement, Tax Blueprint™, an AI-enabled tax analysis platform, and a host of legacy planning services.
The scope of what advisors can offer their clients is game-changing:
- Tax optimization and minimization solutions. Sophisticated tax deferral, avoidance, and reduction strategies pair with trusts and estates services to protect, grow, and shield wealth. Common solutions include Roth IRA conversions, tax loss harvesting, and creative insurance solutions.
- Active, passive, and blended portfolios, diversified, risk-adjusted, and grounded in Modern Portfolio Theory. Financial Gravity’s approach rejects speculation and market timing in favor of efficiency, net return compounding, and intelligent location and withdrawal strategies.
- Family legacy and generational wealth transfer. Financial Gravity’s legacy planning services work to assure clients that they will enjoy their pre-retirement lifestyle for as long as they live. They employ sophisticated trusts and insurance solutions to leverage wealth and provide for family inheritance and charitable giving according to the client’s wishes.
- A modern investment philosophy that focuses on client costs, tax efficiency, diversification, risk alignment, and transparency. These are the values of family offices and work to keep the client on track to reach their financial goals. They also work to de-stress the advisor.
The family office will democratize, in the same way the personal computer, the automobile, and even stock and bond investing did. A combination of superior value, competition, and regulation will replace siloed products, persuasion, and performance-based offers. The advisor who recognizes this early will have a rare and valuable advantage.
