Did you know three in four advised clients considered leaving their financial advisor in 2023? That is a scary statistic, but the reason might surprise you. It is not about bad investment performance (although that would not help). It is all about communication, or more precisely, the lack thereof. 

Think about it. In today’s world overflowing with financial information, where do you turn when you have questions? The internet. Clients are twice as likely to use social media or other news sources to answer their questions if an advisor goes radio silent. Not exactly the most reliable source for personalized financial advice, right? This constant barrage of often-contradictory information can leave your clients feeling anxious and unsure. 

That is where clear and consistent communication with your clients comes in. It is the magic ingredient that builds trust, keeps your clients calm and keeps them on track towards their financial goals. 

Here’s why simply “being in touch” isn’t enough anymore: 

Communication Builds Trust

Studies show a direct connection between how often advisors communicate with their clients and their confidence in their abilities. When communication goes quiet, clients wonder what is happening with their investments. Are they on top of things? Are they even paying attention? Regular updates, whether a quick email, a phone call, or even a face-to-face meeting, demonstrate transparency and accountability. 

Imagine this: the market takes a dip. It happens. But instead of your client panicking because they have not heard from you, explain clearly how it might impact their portfolio and how you will navigate the situation. Suddenly, your client will feel informed, confident and not stressed. 

Clients Need You to Explain Markets

Financial news is everywhere these days. It can feel overwhelming to your clients, especially with complex terms and jargon. You should be the voice that cuts through the noise and explains what is happening in the market in a way that makes sense to your clients, not just financial experts. 

Remind your clients that market volatility is a normal part of investing. Good advisors will anticipate clients’ concerns and address them head-on. You can translate the financial jargon into clear, concise explanations of how these fluctuations might impact your client’s goals. 

Communication Impacts Referrals

Let’s face it: good communication isn’t just good for your relationship with your client; it can also impact your referrals. Would you recommend someone who leaves you in the dark about your finances? Probably not. 

Studies show that nearly 90% of clients say an advisor’s communication style directly affects whether they give referrals. By prioritizing clear and consistent communication, you’re not just building a stronger relationship with your current clients; but also setting yourself up for future growth through positive word-of-mouth. 

So, how can financial advisors improve their communication?

• Tailor your approach: Not everyone wants a phone call every month. Find your client’s preferred method (email, video call, text message, etc.) and frequency.
• Be proactive, not reactive: Don’t wait for a market crash to reach out. Anticipate client concerns and address them head-on.
• Speak in plain English: Financial jargon can be confusing. Explain complex concepts in a way your clients can understand. 
• Focus on value, not just performance: Clients care about their financial future, not just the latest numbers. Show them how your advice moves them closer to their goals. 

Remember, communication is a two-way street. Encourage clients to ask questions and share their concerns. The more you know about their anxieties, the better you can address them.

By prioritizing communication, financial advisors can build stronger relationships, reduce client churn, and achieve better financial outcomes for everyone.

There are several strategies you can use to build trust and increase communication with your clients. Our team is here to do ALL the work for you with our lead-generating workshops, FINRA-reviewed drip campaigns, email newsletters, social media marketing and more. Contact an Executive Marketing Consultant by phone (844) 949-9497 or visit our website to learn more. 

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