The Importance of Being the Sole Advisor

By Art Husami, EA, CFP®, CIMA®, Husami and Associates

In a perfect world, our clients would choose one advisor to manage all their financial matters.

But it’s a fact of life that many clients spread their money around and work with multiple advisors. According to Aite Group, only one of every three clients turns over all of their assets to a single wealth manager.

However, that’s not the best choice for the client or the advisor.

At our firm, Husami and Associates, we ask our wealth management clients to work with just our firm because it’s vital for the long-term value of the relationship, the integrity of our advice, and the trust built between the client and the advisor. Our one-adviser policy is about what is the best way for us to serve our clients.

We put a lot of effort into screening potential clients, and sign on clients who like the idea of our sole advisor model. Since I started the firm, the best business relationships I have are with the clients who have complex needs and let me manage all of their money matters. This is the only way I can provide the truly holistic service they require.

We begin every new client partnership by first determining if the client-advisor relationship is a fit. From the first meeting with a client, it becomes pretty clear whether we can be helpful for a client or not. While some in the industry may think this method is short-sighted or shows one side is better than the other, it’s really about compatibility.

An advisor should be working with people they can best serve, and true compatibility is at the heart of that model.

A Good Attitude

So what does an advisor need to consider when making a sole-advisor relationship work for both parties?

First, consider the client’s overall attitude toward the relationship. If a client asks for financial advice and you request personal details from the client such as current financial situation, compensation, tax details, etc., the client will hopefully be open to giving you that type of information. Just as a doctor asks personal health questions to determine the health situation, CPAs and advisors should be able to have an open dialogue with clients to assess their financial situation.

If a client becomes suspicious or defensive about releasing such information, this is a telltale sign that the long-term compatibility of the client and advisor may be a challenge. Clients should have an open mind when disclosing their financial situation and assets, otherwise, CPAs and advisors can’t provide them the best recommendations. We need to be able to dive into their financial lives without worrying about any surprises.

At Husami and Associates, we can’t imagine working with clients who we do not know everything about.

By having a clear picture of all our clients’ assets, we can spend the necessary time and focus on a holistic plan that is based on well-rounded recommendations and products. It takes a lot of time and effort to provide this attention on each client, and we can only afford to commit the dedication to clients who are willing to give their complete financial matters over to us.

If clients want to work with multiple financial advisors, then advisors will be unable to give clients the best advice because the advisors won't necessarily see the clients' complete financial picture.

When I’m taking the time to work with a client, it means I am committing my attention and resources to that one client. I need their full commitment in order to be financially responsive and successful on their behalf.

Understanding Needs & Expectations

The second thing to consider is, what does a client really need when it comes to their financial matters? By taking a close look at a client’s true needs, CPAs and wealth advisors can determine where they can really make a difference. At Husami and Associates, we work with people who have very complex financial needs and seek out our multi-disciplined services because their issues are complex. We find out the needs of our clients right up front to determine if we can really help them and if we are the best fit.

As an advisor, it’s important to determine what kind of services you want to specialize in and what type of client you want to work with. You must make up your mind where you think you will be the most effective and also happy when working with clients.

By taking a hard look at what you’ve been doing and choosing the type of clients you want to work with, you’ll save yourself a lot of time, effort and headaches. You must be willing to resist the urge to sign up every client who calls, and be willing to decline some clients even if you have extra capacity. Otherwise you’ll lose that one golden client.

Once you know the client’s needs, the third consideration is understanding the client’s expectations. Are they seeking higher returns? Are their finances complex? Do they know their financial goals? Are they well prepared for the future?

If clients are chasing higher returns, want to cherry pick returns, or have higher expectations then you can offer, they may not be good compatible matches. By knowing what their expectations are, we can better offer the appropriate services so that they will be less inclined to pit advisors against each other. Clients who bounce around advisors until they get that extra percent or play advisors against each other, may find short-term financial gains but can also get long-term losses in terms of incomplete or less that the best services.

Some clients like the idea of having different advisors to compare notes with, and we understand that. The best advisor-client relationships still come down to compatibility and long-term partnerships. With those, you should be able to address all their concerns.  

The long-term “sole advisor” partnership has allowed us to be successful for our clients. Today, we quarterback a lot for our clients through different stages of their lives because we know them and have built deep partnerships over the years outside of our own firm. This expertise extends to our clients and their financial requirements.

For example, at our firm, if a client is buying or selling a house, we have a strong rolodex of contacts in the field who can offer the real estate advice they need. By working in this way on behalf of our clients, we can expedite transactions for them and make their financial matters easier to manage.

As advisors, we should set for ourselves the goal of being that go-to person for everything financial for our clients. In the long run, they benefit because we have deep insights into their lives at every stage because we’ve nurtured the relationship. We can help them keep their money growing long after they have earned it. It’s a win-win situation all around.

Art Husami, EA/CFP®, is the principal and founder of Husami and Associates, a single-source provider of comprehensive integrated business and financial services to business owners. The 25-year-old company based in Santa Fe Springs, Calif. provides holistic planning and authoritative advice to its clients.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame logo), which it awards to individuals who successfully complete initial and ongoing certification requirements.

Securities offered through 1st Global Capital Corp., Member FINRA/SIPC.

You may like these other stories...

With our recent coverage of the recent changes and complexities found in FATCA, we realized that regulations are just part of the story. Accounting professionals have to work with foreign financial professionals, and the...
Four years after the first iPad spreadsheet, users finally have a Microsoft-sanctioned solution. When I first installed Excel on my iPad, I immediately focused on its limitations, but upon reflection I see that Excel for...
Change. For some people, it can be a dirty word. Change means adjustment, re-thinking and perspective shifts—all daunting thoughts for an industry such as accounting that is based on mitigating risk and regulations...

Upcoming CPE Webinars

Apr 22
Is everyone at your organization meeting your client service expectations? Let client service expert, Kristen Rampe, CPA help you establish a reputation of top-tier service in every facet of your firm during this one hour webinar.
Apr 24
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
Apr 25
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.
Apr 30
During the second session of a four-part series on Individual Leadership, the focus will be on time management- a critical success factor for effective leadership. Each person has 24 hours of time to spend each day; the key is making wise investments and knowing what investments yield the greatest return.