There are two parts to every financial advisor’s job: investment management and investor management. If all of our clients were like Rip Van Winkle and slept for 20 years, the investor management part of the job would be pretty easy. But alas, investors are subjected to minute-by-minute news about the stock market, unemployment, a poor economy and a gridlocked government. Market turmoil and bad news evoke a state of fearfulness and uncertainty that is not conducive to rational decision making. Helping your clients move beyond the fear and uncertainty to a place where they can make solid decisions about the future is an important part of your job.

Learn how you can do this using the principals of behavioral finance and new findings from the field of neuroeconomics. Scott MacKillop, who has been studying and writing about behavioral finance for over 10 years, will share with you his insights and help you better understand how your clients see and react to the world. The goal of this presentation will be to provide you with practical ideas about how to help your clients regain the composure and thoughtfulness they need to make reasoned decisions about their financial future and work with you constructively to achieve their long-term goals.

About Scott Mackillop

Scott A. MacKillop is President and Chief Compliance Officer of Frontier Asset Management, LLC. He has over 30 years experience in the investment industry, a career he began as a lawyer in Washington D.C. specializing in corporate, ERISA, securities and venture capital matters.

Prior to Frontier, Mr. MacKillop served as President of US Fiduciary Services (‘USF Services’), which provides managed account and investment consulting services to financial institutions and investment advisory firms. Mr. MacKillop was also founder and President of Trivium Consulting. Trivium helps financial services firms develop fee-based investment management and consulting programs. At Trivium, Mr. MacKillop worked with over 50 clients, including Bear Stearns, the Frank Russell Company, JP Morgan Fleming Asset Management, Wells Fargo and Nationwide.

Mr. MacKillop formerly served as President of Portfolio Management Consultants (‘PMC’), now a part of Envestnet Asset Management), one of the first firms to provide separate accounts to independent advisors. He also served as President of ADAM Investment Services, one of the first firms to provide mutual fund managed account services to independent advisors, and as Vice President of ADAM’s affiliate, LCG Associates, Inc., an institutional investment consulting firm.

Scott speaks frequently to industry audiences. He has authored numerous articles on managed accounts, investment consulting and behavioral finance, and more. His articles have appeared in Journal of Financial Planning, Investment Advisor, Financial Advisor, Financial Planning, Financial Strategies, The Monitor and The Wrap Fee Advisor.

Scott received a BA from Stanford University and a JD from George Washington University Law School. He holds a Series 65 securities license.

Our first episode features a conversation with Richard Brown, Chief Executive Officer of JNBA Financial Advisors, an independent wealth management firm and registered investment advisor in Bloomington Minnesota. As a Barrons top 100 RIA, JNBA specializes in asset management and financial planning. Richard shares with us his unique entry into the business, his strategies for growing his practice from $85 million to more than $300 million in just a few short years, and how his community involvement enriches his life and those of others.

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The first portfolio is the traditional 60/40 portfolio which invests 60% in large US stock and 40% into bonds. The second portfolio is an age-based 60/40 portfolio where the investor’s age determines the percent allocation to bonds with the remainder invested in the 60/40 portfolio.

The last portfolio is an age-based multi-asset portfolio which combines all seven assets in equal portions. The investor allocates his or her age to bonds and the balance to the multi-asset portfolio. So, for example, a 40 year old would invest 40% of their portfolio into bonds and the remaining balance of 60% into the multi-asset portfolio which utilizes all seven assets in equal portions. A 65-year old would invest 65% of her assets into bonds and 35% into the multi-asset portfolio.

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This is the first in a series of articles to inform you about creating the right RIA marketing and business development mix for your business. These articles will address many of your questions about how smart marketing can raise your firm’s awareness, generate prospect interest and help you grow.

This first article explores basic marketing principles and marketing planning. Subsequent articles will focus on:

• Simple Steps to Building a Effective Marketing Plan
• Marketing Techniques to Generate New Clients
• Who Are You? The Importance of a Compelling Brand
• Public Relations as a Low-Cost Way to Generate Awareness of Your Firm
• Effective Advertising Planning and Execution
• Using Live Events to Grow Your Practice
• The Web as a Foundational Component to Your Marketing Strategy
• The Right Marketing Communications Mix For Your Practice
• Marketing to Maximize the Potential of Your Existing Clients
• Marketing Resources Available to Help Achieve Your Firm‚Äôs Goals

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Overview

If you’re reading this, there’s a good chance you enjoy marketing. You appreciate clever ads like the ones you see for Super Bowl commercials and recognize good marketing talent when you see it. If you’ve studied marketing, you know that marketing is about delivering a message or telling a story to your intended target audience. If you’ve done any marketing, you would probably agree that referrals are the most effective form of marketing. You may not get as many referrals as you would like and you may not be completely satisfied with the quality (size) of the referrals you do get. If any or all of these statements are true, you will benefit from reading this. The purpose of this paper is to share what we believe is the secret to getting more and better referrals. We will also describe a system called Referral Builder that will enable you to create and sustain a pipeline of qualified prospects for your business. If you apply the suggestions outlined in this paper, your marketing plan will produce better results with less effort.

Maximum Impact Marketing Philosophy

Before we get to the system itself, let‚Äôs establish a baseline for you. There are a few key points you must be aware of if you want to reap the full benefits of this system. Collectively, these constitute our marketing philosophy…

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In past articles, I have discussed different elements which increasing likelihood of marketing success such as creating an action plan, consistently marketing and touching your contacts throughout the year (clients, prospects and COIs). One of the most important things you can do to increase likelihood of success is one I have not discussed previously and that is to assign responsibility. Choose someone in your office who is responsible for the execution of your marketing. Depending on the size of your firm, you may want to hire a full time marketing coordinator for this role. If that is not in your budget, look to someone in your office who has an aptitude for marketing and the capacity to oversee your campaigns. If these two options are not feasible, considering hiring a marketing consultant to help you draft and execute your marketing strategies. Find someone who can help with the internal processes (referral process, client communication) and not just someone who specialize in branding, advertising and PR. It is these internal campaigns that can be the most successful but take significant time to implement.

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The Advisor must fully understand the impact each meeting will have on the overall planning process and the role those meetings will play in managing their client relationships over the long term. As prospects and clients go through the planning process and various planning cycles the advisor will find it necessary to conduct a wide variety of individual meeting types that all must be effective at delivering results. The advisor will need to provide logical meeting structures and be able to explain in great detail how each meeting fits into the overall planning process. The more skilled and prepared an advisor is to conduct those individual meetings, the easier it will be to keep their clients on track to achieve success. Although each individual meeting will be different in scope and nature most can be categorized by type from a short list of common meetings you will have.

Over the years, I have identified six different types of individual meetings that are the most common within my own personal practice.

• Discovery Meeting
• Plan Presentation Meeting or a Recommendations & Solutions Meeting
• Solution Implementation Meeting
• Follow-Up/Next Step Meeting
• Progress Report & Review Meeting

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Older women present a client base that has been neglected and overlooked.  It’s a real opportunity for you to provide investment advice. First, the single older woman portion of the population is sizable and growing due to a significant difference it the life expectancy ratio between males and females. Second, older women control an increasingly larger share of personal wealth.

More than 90 per cent of women will be entirely responsible for their own financial affairs at some point in their lives–most often through divorce or the death of a partner, according to the Bureau of the Census. By age 65, 60% of women live alone, and of those 48% are widowed, 7% separated or divorced and 5% never married.

The need for investment advice includes:

• Reevaluating and adjusting living conditions and expenditures, especially those related to health and income,
• Evaluating investments for increasing risks,
• Finalizing estate plans and last instructions,
• Pre- and post-divorce financial counseling and,
• Creating legacies to children and grandchildren.

The average age of widowhood is a surprising 56. Widows in the over-65 age bracket outnumber widowers five to one. ¬†The reason: women’s life expectancy is approximately seven years longer than men’s.

• Overall older women want:
• Relationships not just transactions
• Explanations, not just recommendations
• Questions answered at the right level of detail and
• Service, not just performance

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– Ancient Chinese Proverb 

In many ways, the process used to develop a blueprint for your business is similar to the investment consulting process you use with your clients every day. It can be broken down into five distinct steps: 
Step 1: Develop a Personal Mission Statement
Step 2: Assess the Status Quo 
Step 3: Define Goals and Objectives 
Step 4: Design the Plan 
Step 5: Implement the Plan 

By following this process, investment professionals will significantly increase their chances of making a successful transition to consulting. 

The hard part  is finding the time to go through this process. Business planning, in and of itself, does not generate revenues (at least, not in the short run). As a result, most of us postpone this type of work in the interest of doing things that “put money in our pocket.” The problem is that most of us never get around to doing it at all.

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Step 2: Assessing the Status Quo

“If you have always done it that way, it’s probably wrong.” Charles Kettering

The second step in the Business Planning Process is to look at where you are today. Assessing The Status Quo is about analyzing your existing business to determine how and why everything is done. In conducting this analysis, it may be helpful to view your business as a set of systems. A system is simply a collection of elements that work together to produce a result. Your business is basically made up of two types of systems- client-based systems and practice-based systems.

Client-based systems are those systems that directly or indirectly affect your ability to satisfy the needs of your clients. These would include activities such as marketing, portfolio management and client service. Practice-based systems are those internal systems that affect your ability to run your business. These would include information management, human resource management and strategic planning.

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