Teaming with a Financial Advisor
by Terri Eyden on
By Michael Alter
Recommending a financial advisor to a client is one of the most important recommendations you can make. Customers will trust your recommendation; therefore, there is a potential your future with that customer could be impacted. Teaming with an advisor who serves your customers with the same level of care with which you serve them is critical to the success of a healthy, long-term relationship for all parties.
Before rushing to find an advisor to team up with, CPAs could keep that service in-house by attaining certification or designation. Having an advisor on staff can enhance your practice greatly.
You can learn more about personal financial planning qualifications on the AICPA website.
Partnering with a financial advisor
Partnering with an advisor requires the same planning as any critical partnership for your practice. Partnership agreements must clearly define the rules for both parties, and remember that any work done by an advisor will impact your client relationship.
"Financial advisor" is a broad term that can mean an advisor provides only a few services or it can mean your potential partner deals with investment plans, estate planning, business succession plans, various types of insurance or pensions, and other retirement planning services, to name a few. Financial advisors may work for a brokerage firm, a company, or independently.
Financial advisors can vary in their approach and compensation. Make certain their approach and how they measure a job well done, including their compensation, is agreeable with what you would like your clients to experience. Some of the most common compensation models for advisors are fee-only, fee-based compensation (fee and commission), and commission.
Partnerships like these are most successful when they are equally reciprocal in nature. When establishing an agreement, clearly define the reciprocal aspect of the relationship. Sending your customers to an outside service provider presents a risk of losing that client, which should only be acceptable when there is an equal level of business being fed back into your practice.
Having an approachable demeanor and being able to interact effectively are important soft skills for accountants and financial advisors. To learn whether a financial advisor has acceptable soft skills, ask to observe the advisor working with a client. When advisors have good soft skills and they are responsive to phone calls and e-mail messages, these are indicators that they may be a good fit as a partner.
Research the advisor's qualifications and capabilities with major financial advisor organizations such as the National Association of Personal Financial Advisors (NAPFA). NAPFA suggests looking for advisors who have such designations as Certified Financial Planner (CFP), Personal Financial Specialist (PFS), or Chartered Financial Consultant (ChFC).
NAPFA also has a field guide on what to look for in a financial advisor. Other good sources for research in this area are the SEC, the Financial Industry Regulatory Authority (FINRA), and the North American Securities Administrators Association (NASAA).
Read more articles by Michael.
About the author:
Michael Alter, payroll expert with an MBA from Harvard Business School, is a nationally recognized spokesperson providing thought leadership and sensible advice to help accounting and payroll professionals build deeper more profitable relationships with clients. Alter, president of SurePayroll, writes the Trade Secrets column on INC.com and is frequently published in Bloomberg TV, Wall Street Journal, and Entrepreneur Magazine.
You may like these other stories...
Recently, we posted an article about being "Tax Smart Year-Round." To help accountants help their clients, we're posting occasional investing pieces to show that tax time is not the only time to think about...
Ex-Grant Thornton partner gets 4-1/2 years for $4 million theftCraig Haber, a partner at Grant Thornton from 1993 to 2012, was sentenced to four-and-a-half years in prison on Wednesday for stealing nearly $4 million from the...
Read more by Kristen Rampe here.One of my client service webinar participants asked in the Q&A, "Do you suggest the use of client satisfaction surveys?" This one hit a hot button with me, as evidenced by my...
Upcoming CPE Webinars
BAR is an acronym for: Boundaries, Authority and Role. This simple tool will provide participants with a solid understanding of leadership essentials to improve their performance.
This material is designed to provide a start-to-finish overview of how to plan and complete high-quality small audits efficiently.
In this session Excel expert David H. Ringstrom, CPA shares numerous techniques that you can use to work with charts more efficiently.
Key Accounting and Reporting Issues for Nonprofits No. 1: Overview and Statement of Financial Position
This material focuses on non-profit organizations organization, accounting and reporting.