What’s Keeping You From Working With Wealthier Clients?

In January of 2024, FA Magazine released a survey of the key concerns of 421 advisors. Within that data, 64.8% of the respondents reported that they were concerned about moving up-market, or finding clients that are wealthier than their current clients. This is a valid concern, as advisors may feel that growth is only attainable when working with clients that have assets larger than their current book of business.

Referrals Are Demographically Similar

What holds advisors back from reaching those wealthier clients may be a variety of factors, combined. Often, advisors rely on referrals from current clients in order to grow their business. It would make sense that their current clients often refer those similar to themselves – so for example, if your current client is 55 and married, with $500,000 in assets, they may also have a friend that is around their age and has a similar lifestyle. When clients are referring and helping you to build your book of business, it ends up looking homogenous to your current book, because they are referring the people they know – which tend to be very similar in assets.

Even when you are asking for referrals from another source, such as a tax professional, you may be able to move slightly out of your demographic, but often advisors don’t utilize this to the best of their ability.

Lack Of Time And Focus

When you’re busy running your business, it can be difficult to think about how to grow your business. Your current clients are likely taking up the lion’s share of your time, which leaves very little time and effort for devising marketing, outreach and effort for reaching out to an entirely new demographic – one which you may not be used to interacting with. A wealthier client may also demand more of your time as a client than your current clients do, so it’s important to keep that in mind when you’re anticipating how you’ll market and pursue higher net-worth clients.

Unfortunately for many solo practices, or small practices, your resources are already stretched thin, so there’s a lack of focus when it comes to how to implement the techniques you’ll need to obtain a higher net worth client. Very affluent clients likely have more competition from firms that offer them services, tech, and add-ons that you may be unable to simple because they have a broader scale.

Adjust Your Strategy

If you’re looking to adjust your client demographics, you have to adjust your strategy. You can’t expect change without changing how you are doing things and how you run your business, and it may involve adding in additional resources – either with the help of marketing, creating referral sources with attorneys or tax professionals in wealthy areas, or adding in additional services that make you stand out to a wealthier clientele.