How do wealth managers find clients?
The best route you can follow is to copy what the best in the industry are doing and replicate it!
Alright, you want to be on the Forbes 250 Financial Advisor List. You have the drive, vision and support. There are some very common Niches Of The Forbes 250 Financial Advisors and we went through all of them to discover what common traits they had. Read on to see the top niches and servicing focuses based on their profiles.
Top Niches Of The Forbes 250 Financial Advisors # 1 : Stock Options
In modern times, individuals that have earned these are still confused on many aspects of it. Exercising windows, how to pay for them and tax implications are just a few but major moving parts. Not enough individuals seek help when dealing with these and many have made costly errors by not seeking financial advice.
We love this area of focus for a few different reasons.
- It is becoming more popular and accepted in order to draw new talent to organizations
- It gives employees an incentive to work harder and commit more time to the company
- There is a tremendous opportunity for option holders to receive a major cash inflow
- It is a difficult area to navigate for option holders and provides a huge referral opportunity for advisors
- Dedicating time and effort into this means you can implement it in year 1 or year 30 of your practice
Now finding these are not as hard as you may think. Major corporations and insiders are required to disclose these transactions. Typically, those exercising them may have other options, or will be granted more in the future.
Stock option usage will continue to grow as new companies emerge and larger institutions look to retain top talent and the reason this is one of the top niches of the Forbes 250 Financial Advisors.
Make it yours too.
Top Niche # 2 : Corporate Executives
These individuals have worked their entire lives to be where they are today. Chances are it wasn’t the prettiest of journeys either. With the constant economic changes, “disruptions” in old markets, these individuals are on the forefront of the chopping block.
Knowing this, they look for every edge possible to secure the well-being of their finances for their family and will trigger high percentage conversations with Wealth Advisors.
There is no shortage of this type of prospect and are undeserved across the country.
Top Niche # 3 : Entrepreneurs
If you are seeking out early stage company options, focus on later Series Funding companies in funding Series C-E for example.
These stages will give the potential company an exit such as an acquisition or IPO. The earliest founders and staff will have a significant liquidity event in which they will certainly need guidance.
There are some cases in which they receive very costly and borderline criminal advice. Here is a short example how a company encouraged employees to take recourse loans through the company to purchase stock options.
Any decent Financial Advisor would have strongly advised against this. Now these employees that are in danger of being laid off are now in danger of having their personal assets compromised.
You need to be in front of these people for the sake of helping them avoid situations like this.
Realize that while this is a top niches of the Forbes 250 Financial Advisors, this is a long term strategy that might take 7-10 years to cultivate.
Top Niche # 4 : Business Owners
The mass retirement of the Baby Boomer generation is resulting in an interesting find. The transfer of wealth from that generation to the next is reportedly estimated to be $30-68 Trillion worth of assets.
This includes liquid and illiquid investments such as marketable securities and business assets. Around 50% of children do not want to inherit, run or take over the parents business.
This means the owner will most likely have to sell or close their business with the earlier being the preferred method.
Conclusion : Approach The Top Niches Of The Forbes 250 Financial Advisors With This
105b-1 Stock Option Planning
“A 10b5-1 trading plan can be an effective way to liquidate company stock holdings for insiders who otherwise might get shut out of open market sales because of inside information,” says David H. Engvall, a partner with Covington & Burling LLP.
Despite their increased use, many top executives are still unaware that Rule 10b5-1 trading plans exist or are unsure of how to take advantage of them. That’s where you, the advisor and the employer can offer guidance.
Trust and Estate Planning
All of the Forbes 250 Advisors we spoke to incorporated Trust and Estate into their practice. Trust and Fiduciary services were arguably the most important piece for their prospecting efforts and high net worth clients.