What do Financial Advisers Need?
August 4, 2003
Financial intermediaries often explain to clients that wants and needs are two different animals. But the same holds true for the intermediaries themselves, particularly separately managed account advisers.
According to John Nersesian, managing director of Nuveen Investment's wealth management services, brokers' wants and needs are vastly different.
Advisers want to be told what they can do differently and what precise steps they need to take to focus their business on consulting, he said. They also want to know exactly how to find clients. "They want to know the marketing techniques and how to get in front of a $20 million corporate executive, or the approach to getting in front of a foundation or endowment," Nersesian explained.
Furthermore, advisers are reaching out and increasingly asking investment managers to help them design portfolios, he said. "They want a solution," Nersesian added.
That was the impetus for the creation by many firms of multi-disciplinary accounts that can bundle investment styles and offer lower minimums, in addition to oversight and automatic rebalancing, he noted.
On the other hand, financial advisers' needs are far different, Nersesian said. They need a better understanding of who their high-net-worth clients are and what they really need, he counseled. "Clients today are different from the ones we served even five years ago," he said. "They are more sophisticated, more astute and have experience with a bear market."
Intermediaries also need to be well-versed on a breadth of investment issues and solutions, including portfolio construction, asset allocation, taxes, wealth transfer and stock options to name a few, Nersesian noted. An advanced skill set with deeper and broader knowledge is a must-have in today's climate. Advisers need to develop their tools in order to better serve clients who will often pay a premium price for the services of more advanced individuals, he commented.
In addition, advisers must be able to better communicate the value of their services to clients, be able to describe what they do and differentiate themselves, he said. "Intermediaries must understand the value of their practice and be able to communicate that in a client-centric way," Nersesian said.
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