My guest on today's podcast is Veronica Karas. Veronica is a Senior Financial Advisor at CAPTRUST and works from the RIA's Lake Success, New York, office, where she oversees $360 million in assets under management for about 200 client households.
What's unique about Veronica, though, is the unique 3-question approach she uses to generate referrals not only from clients, but also from centers of influence as well, and even uses it to get referrals from prospects… all without being too pushy or salesy.
In this episode, we talk in-depth about how Veronica developed her 3 referral questions – which first ask clients (and others) to reflect on what else she could be doing from them that would be valuable, then what are the services she and her firm provide that are the most valuable, and then whether there is anyone in their lives that could use help with those same services they just said are so valuable – and to please facilitate an introduction to those individuals in need, how Veronica built this 3-question approach because she didn't have a natural network of friends and family to give her referrals and had to figure out how to comfortably ask the existing clients of one of her mentors, and the way that Veronica follows up with the introductions she receives to turn them into new business opportunities!
We also talk about how, amidst onboarding 52 new clients in a single year (due to the success of her 3-question approach), Veronica developed a blueprint that all new clients would go through in their 1st year with the firm that leverages a more modular approach to planning and stretches out the planning work (for the client, and her own team) over the span of 12 months, how Veronica's firm structures associate advisors to work with multiple senior advisors at once to not only offer high-touch service to their client households but give those associate advisors more intentional opportunities to learn what they can by being in meetings with many different experienced advisors of the firm, and how Veronica's firm structures its advisor compensation to both empower associate advisors to take over client relationships and still have the incentive to learn to build their own book of business as well.
And be certain to listen to the end, where Veronica shares how she overcame her early-career feelings that she was too young to serve as a lead advisor, how a commitment to talking about her work with at least 5 people each day for 2 years, from strangers at Target to fellow advisors, helped Veronica to overcome her fears and generate a rising flow of prospect leads and introductions to key referral partners, and how Veronica has maintained her focus on doing the right thing to navigate ethical dilemmas that have arisen over the course of her career, even when it meant leaving a job after less than a year to start over somewhere else.
So, whether you're interested in learning about a structured approach to generating more referrals, how to create a systematized process for a client's 1st year, or how to overcome the challenges of starting out and creating your own book of business, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Veronica Karas.
Resources Featured In This Episode:
- Veronica Karas
- 3-question approach – Download (PDF)
- Client's 1st-Year Service Blueprint – Download (PDF)
- Service Beyond Expectation – Download (PDF)
- Microsoft Planner
- Microsoft Dynamics
Looking for sample client service calendars, marketing plans, and more? Check out our FAS resource page!
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Michael: Welcome, Veronica Karas, to the "Financial Advisor Success" Podcast.
Veronica: Thank you so much, Michael. It's a pleasure to be here with you. Thank you for having me.
Michael: Thank you for joining us. I'm excited for today's episode and to get to talk a bit about referrals. I look at the industry research, we now run some of the industry research around how advisors market and grow their business. And the number one overwhelming dominating channel that most advisors use for growth is client referrals. I think our last data had 93% of advisors grow with referrals, and I'm assuming most of the other 7% are simply because they're so new, they don't have enough clients yet to refer them or they've been doing it so long that they just literally don't want any more clients.
Everybody in between, we serve our clients well in these deep relationship businesses and it feels sort of inevitable that some number of them are going to refer some friends, family, colleagues, someone else, and we get to grow that way. But the challenge I find is that most of us grow through referrals, and most of us do not get as much referral growth as we would like. We get some, but not a ton, and it's really hard to figure out how to change that. Most advisors I know don't like asking for referrals, it can feel awkward or campy, or just too aggressive and salesy.
But if you're just sort of heroically wonderful for your clients and never facilitate that conversation, that doesn't always really seem to go better either and we kind of get stuck in limbo land where we're serving clients while we have astronomically high retention rates. It seems like everybody should be really happy to refer, and I'm getting some referrals but not a lot. And I know you have just a very different approach to this.
You would actually join us on our marketing summit in spring of 2023 to share some of this technique and system you've built around, I guess as I would frame it, asking for referrals, although notably, I don't think you've ever actually used the word referral in the conversation, which is probably part of the point that you're going to educate us on in a moment here. But I'm excited to start this discussion around building practices through referrals and when you want to actually get more referrals, how you make that conversation happen.
Veronica: Yeah, so when it came to building my practice, I'm going to go a little bit back and we can go further back. But I came here with my family as a refugee immigrant in the early '90s. And when you get into the business of financial advising at any point, and I had the pleasure of starting at an insurance company way back when, they always go, "Well, what's your personal network like? Let's make a chart, let's make a little flow chart..."
Michael: Yes, friends and family, 100 names on the list.
Veronica: Yes, the names, and I'm like, "Everybody I know came here with $40 and 2 suitcases and doesn't have much to their name beyond that". And so, I didn't have a personal network at all. And I was fortunate in the group that I joined now at CAPTRUST and prior to CAPTRUST, we were called First Capital Equity.
And so, I was like, "Okay, how do I make this happen in a way that people won't dislike me?". That was my big fear. And/or think I'm like a kid, right? That was the other thing that's sort of in the back of my mind, which we can talk about. I was pretty young when I started building a book of business, not that I'm... I'm also much older now. But how you look and where you are in stages of your life matters too. And so, when I joined the practice, and the partner I was with, Alan Kleinberg, fortunately enough took me under his wing, he was like, "You can ask my clients for referrals."
I wasn't good at it. I would just be like something awkward, which I have heard other advisors do where they struggled asking for referrals, it's like, "Hey, I think we do a pretty good job for you, maybe there's someone you know that you might send our way?". Or my first initial line was something like, "I know you've been working with Alan for a long time, but I'm really trying to build my own client base, is there anyone you know that might be a good fit?". Which is such a terrible way to ask for a referral.
Michael: Yeah, that's basically like... you're almost putting yourself in the position of, "You've been with Alan forever because he's a senior advisor and you're a senior client. I'm like a young new advisor, so do you know young new people who could work with me?"
How Veronica Developed Her 3-Question Approach To Generating Referrals From Clients [7:41]
Veronica: Yeah, it was bad. And so, it's funny because I was listening to a podcast related to sales, I think it was a Tony Robbins podcast. And Tony Robbins early in his career talks about selling audio cassettes door to door. And he used to ask people at the end of every time he had a conversation with them, and don't quote me on this, so Tony, I'm sorry if I'm misquoting you if you ever hear this, but it was something along the lines of, "Is there anything that you're not getting out of these audio cassettes that you were hoping to get out of it when I sold you these audio cassette tapes?". And people would be like, "Oh, I wish I didn't have to rewind them so much", whatever they would say.
And then he would be like, "Is there anyone who's really struggling with records that needs audio cassettes?" Something along those lines. I don't know why, but in that moment, it sparked something in me because I was like, if I just asked every client, "Is there anything I'm not doing for you that I could be doing?", which is a play on that question, it's not offensive. I actually liked that question. And I started to just ask that question. So, it was like at the end of every meeting Alan and I would have together, I would just ask as like a temperature gauging question like, "Is there anything we're not doing for you that we could be doing that would be helpful or valuable?".
And all the feedback we got was overwhelmingly positive. It was like, "Oh, my God, I'm so glad you asked. You guys do so much on my personal stuff, but I wish you helped me with my business cash flow a little bit", which never in a million years would I have thought that that's what that client would want. Or someone would say like, "I think it's really time I introduce you to my kids because they could really use your help", where it became like this great way to sort of start a whole different conversation.
Michael: So, wait, let me pause and just ask, I'm trying to visualize the context. So, you're sitting associate advisor style with Alan as the senior advisor at this point? Is it the 2 of you going out to these meetings with the clients jointly and this is your question at the end of the meeting?
Veronica: That's correct. It would be like an agenda item at the end of the meeting where we just ask, "Is there anything we're not doing for you that we could be doing?".
Michael: And is that something literally you would ask? Alan would ask? I'm just trying to envision the dynamic in the meeting when you're jumping in with this question after Alan has been working with them for 3, 5, 10-plus years.
Veronica: So, this is where I was really fortunate. Alan, in the beginning...and because he's also a big talker, a lot of love to Alan, would do a lot of the talking. But as we built our relationship and I built relationships with the clients, I used to run a good portion of the meetings. So, this would happen...it would kind of naturally flow at the end of the meeting. So, I would take them through, let's say, their Monte Carlo at the very end of the meeting, and then I would wrap up with sort of conclusion, "So, we need to do X, Y, Z on your accounts, we need you to send us your wills, we need your latest tax returns," whatever it is. And then I would say, "Are there any questions?" And then I would ask the question.
Michael: Okay. Okay. And so, I'm also struck by this, I feel like there's a subset of us that maybe would have some fear in asking that question, "Is there anything we're not doing for you that we could be doing that you would find valuable or helpful?". That there's this fear of like, "Oh, gosh, they're going to unload that they don't like what we're doing", they're going to unload that they don't like me, they're going to ask for things I can't do and then I have to say, "No, I can't do that", and now it's like worse because we brought it up ad I literally had to tell them no. I guess I'm both wondering did you have that concern and did that actually crop up as a problem? Or do we just imagine this fear and that's not how it goes?
Veronica: So, I definitely had that concern, and in full disclosure, I think Alan had that concern too because he was like, "I've been working with these people for 20 years and no one has asked them this question. What if there's a whole bunch of stuff we don't do for them?".
Michael: "Yeah, tell me all the ways I failed you for the past 20 years". It's like a little bit awkward, there's a moment to set up.
Veronica: Yeah. And so, he was like, "Well, you know what? Try it and if it doesn't go well, then we won't do it anymore". Right? It's like, "Be a little bit bold and play with it." So, I tried it with actually one of our biggest clients and the response was so positive, the very first one, and I think this helped. But the response was so positive because the client was so grateful that we asked the question. There was nothing, by the way, that the client wanted us to do. It was like, "No, you guys take care of everything. I trust you, I love you. It's so great. And I'm really glad that you're asking this question because it's like if there was something I don't think at any point during this meeting, would be...as you're going through my projections and my financial plan, it would be a good time for me to interject. So, I appreciate you opening the door for this conversation".
So, that was sort of the very start, so I just started asking it. And there was...most of the time, let's say the worst response I've ever gotten to that question is just a cold…sort of like clients who are not as warm and fuzzy or talkative, maybe just being like, "No, it's fine". Like, "Everything is fine, I'm good, there's nothing else you could do for me, it's all good". And on the flip side, sometimes people gush over you over how great it is. So, it was a totally unwarranted fear. We talked about it, we thought about it, we worried about it, and it came to be like totally something we never had to think about twice.
Michael: So, do you ever get unreasonable, unrealistic requests that you then have to tell them like, "I'm sure that would be helpful but, no, I really can't do that for you", or does that just not really crop up? People, if they asked, they still tend to ask for reasonable things or improvements?
Veronica: Yes, so I think I've had a couple of people ask for things we don't do, outright do not do. Like, "It would be helpful if you filed my taxes for me every year because my accountant sucks and he's not responsive", and we have to pivot that conversation to say like, "Well, let's just find you a new accountant, let's work together and find you a new accountant".
Michael: "Yeah, I can still help. I won't do the return, but I can still help".
Veronica: Yeah, that's exactly right. So, no one's asked me to come mow their lawn on a Wednesday and I would kind of find a way to joke around that if that ever came up, by the way. But every single person...and by the way, it's a great thing to know that they're unhappy with their accountant and that we can facilitate an introduction to someone new and help in that regard. So, overwhelmingly, whether it's something we can literally do or cannot do or anything in between, it's been a great question to ask. It's actually of the three referral...of the three questions asked in the referral questions, it's by far my favorite question.
Michael: And I'm struck you mentioned that one of the responses you get was literally like, "Hey, you do such great work for me, could you help so and so as well?". Some people just literally started...their response of how you could be more helpful was to help a friend or family member with it. Now, the example you gave was, "Help my kids", which I know for some of us, that's not exactly an ideal referral. But am I reading that right, that the referrals basically started coming out of that question directly?
Veronica: Yes, that's exactly right. That's exactly what happened. So, before I even added those first 2 questions, we immediately saw an uptick in referrals.
Michael: And was that the goal? I know we've set this up...we sort of set this conversation up around referrals, but was the idea, "I'm going to ask this question and people are going to respond with a referral", or was this more of like, "I'm just literally trying to serve my clients better"? It wasn't a referral path originally, it was a, "I just want to figure out how we serve our clients better and deepen the relationship".
Veronica: So, what I thought would happen initially was I would ask that question, so I would ask, "Is there anything we're not doing for you?" And people who loved us and thought we were doing a great job would just use that moment to gush over what a great job we do for them. And then that would lead to a warmer conversation for me directly asking for a referral. In other words, what I thought would happen was I would ask the question and someone would be like, "Oh, my God, no, you help me with my estate planning and my tax planning and my retirement projections and you just do so much work for me, I'm grateful for all of it". And then I could in turn be like, "That's so great, thank you so much. You're a great client of ours and if there's someone you know in your life that we could help too, we would love an introduction". I was just going to pivot on that.
Michael: Right, right, just right there, take them literally gushing over how much they love you and then it's like, "Well, if you love us that much, is there anyone you love who would love us too?".
Veronica: Yeah, exactly. Basically, that's what I thought would happen. I could not anticipate people being like, "Oh, my God, I was actually talking to my friend John on the golf course and you know what would be really helpful is if you could have a conversation with him because he stressed about his defined benefit plan", or whatever. That happened all the time.
Michael: Okay. And so, where and how did you start inserting this question? Was it targeted? "Here's the clients we want to get some referrals from". Was it everyone? Was it like, "We're just going to go through the whole client base once and see what happens"? Did it become like, "We're just asking this at every meeting repetitively because who knows what they're going to say this time"? How were you inserting this question in?
Veronica: So, yes, we did it as part of the annual review process. So, not every meeting, not every conversation, and not every time. But when we had a big full meeting, we would make sure we asked the question because I feel like at that point, we felt we were going comprehensively through everything in their financial life. And so, if we did the comprehensive review of sort of, "Here's your financial plan and everything we do", it's a good lead into like, "Hey, by the way, is there anything we're not doing? Is there anything we're not talking about?", anything like that.
Michael: So, you start using this question, it's going well, so what happened next? Where did it go from there?
Veronica: So, the challenge...so, referrals was my only...for a period of time, referrals from Alan's clients was my only chance to build a book of business for some time and I wanted to increase the rate. So, the same thing I said where there were clients that were gushing over us, there were clients who were kind of just...they were dry about it, for lack of a better term. They would just be like, "No, I'm happy here". That's it. And then it's sort of like, "Okay, what do you do with that?", because it doesn't lead to such a warm, "Yeah, you're happy here, do you know anybody else that would be happy here?". It's not like a natural flow to the question.
If someone's gushing over you, that's one thing. But we found...more or less, probably about half the people we asked were like, "No, there's nothing that comes to mind", or, "No, everything is great". What I would call a mild answer, let's say, if they didn't have a specific thing. And so, then I thought, "Okay, what is something I could add to it that for the people who are the non-gushers type of the world, let's say, that they would have to be very concrete about what we do for them that makes them happy?", right?
So, sort of like a, "You tell us, you're saying you're happy here or everything is fine. Well, I want to know what you appreciate, I want to know what it is that makes it warm, makes you happy, makes you stay". Alan and my other partner here, David...and David's had clients for like 42 years, what makes a client stay for 42 years but also not ever refer anybody, right?
And so, I was really focused on the referral part. And so, the second question, and it went through so many iterations but I really wanted it to sound very similar to the first question is where I came to because I wanted it to flow naturally, became, "Yeah, thank you so much. We hear that you're happy with us", for someone that's a little bit drier. "That's really, really great. What would you say are the top 2 or 3 things we do for you that are most helpful or valuable?". It's just a way...
Michael: So, it's just like drilling down a little further. "Yeah, yeah, you're great." "Okay, but how am I great?".
Veronica: Yeah, exactly, like, "Tell me specifically". Because I wanted...I was a little bit on a mission, I wanted to see if there was a chance we could get a referral from every client. I'm a little bit in that... I'll take on a challenge or if we can gamify something a little bit and make it a little bit more interesting, more fun, I'm all for that. And so, I think it became, "How do I structure these questions to get the warmest responses from people? How do I get to the point where someone who is not normally gushing over us starts gushing over us so it's easy and natural to ask for a referral?". I wanted that feeling where when I'm asking them for a referral, it didn't feel uncomfortable and there was no like ick factor behind it, which is actually hard. I feel like it's hard.
Michael: Because you're literally just taking the time to ask them the questions that let them express how much they like you and how happy they are, right? They're setting themselves up or you're setting them up into the conversation. Like, "Let's talk for a while about how awesome our planning services are. Now, by the way, about referral, since you've just spent a few minutes talking about how much you like us and these things we do for you?", right? You've put them into a certain kind of a very positive mental state where they're literally reminiscing about all the things they like about the firm and what they do. Can't really get a warmer opportunity than that.
Veronica: Yeah, that's exactly right. And I feel like in our industry, people talk about when a spouse dies, it's really hard to...the money doesn't really stay with the advisor, or when parents die, it doesn't transfer to the next generation, all this stuff. We don't really have that problem here at all. Ninety-nine percent of the time, we keep the assets through generations. We have families we work with five, six generations of because again, David has had this business for 42 years. And other than the money following the inheritance trail, in a lot of those cases, maybe they haven't naturally referred other people.
Some people are great referrers. They just are naturally. You don't have to do anything for it, you don't have to ask the questions. They're the people who I like to say like everybody has a town realtor in their life who will tell you the talk of the town and what's going on and they're happy to buzz about it. But some people just don't have those personalities. And so, I was really determined to broadly increase our referral rate and I feel like some people, when it's not their natural instinct to be that sort of town realtor personality, that you have to be willing to pull it out of them or find a warm way to get to know the other people in their life.
And having started in insurance land, I've seen the icky side of that, right? Like go on LinkedIn, find five people they're connected with, and ask them about those people. For me, I would hate if somebody did that to me, for instance. I know that's a strategy and I know that it works, I'm not taking away from that. It's not part of my personality to do that, to do background research on who someone might know to figure out if there's a referral there. It's not within Veronica's scope of comfort, let's say. And so, I wanted them to tell me who in their lives could benefit from whatever they found most helpful and valuable, and then it was just a matter of how do we practically connect with that person. That was it.
Michael: I'm presuming then the next part of the conversation is, "Okay, so will you provide us a referral?". So, how does that part of the ask work when it's time to get there?
Veronica: Yep, so the 3rd question just kind of naturally came, so the person would say, "Oh, it's been so helpful for you helping me to unravel my employer benefits and helped me with my budgeting". I'm just coming up with something. And I'd be like, "Great, that's so nice to hear. Thank you. We're so happy to help you with those things. And is there anyone you know in your life that needs help unraveling their employer benefits and maybe some budgeting help? We would love an introduction". And I just used whatever language they used to ask and it became natural. So, it wasn't like a, "Could you give me a referral?" It was more like, "We'd love to meet anyone you know in your life that needs help with those things".
Because the reality is if you think about your own struggles, you think about stuff you go through, there's usually someone maybe that you run it by. If I didn't have a financial advisor, hypothetically, and I needed to figure out my employer benefits, I might ask some friends who they know or who they use, or I might ask HR, or I might ask my colleagues about it as an example. And so, I was trying to tap into that, like, "Who else in your life might need help with those things you just said were valuable?". Because I also want them to...I want the person I'm talking to, to think of those people that they maybe have had those conversations with.
Michael: And so, share that with us one more because I'm sure you've been intentional about the words you use and how you craft it. So, how do you actually do the ask when it's time to say...referral time?
Veronica: So, I say, "Is there anyone you know in your life who needs help with (insert whatever they just said)? We would love if you could facilitate an introduction".
Michael: "We would love if you could facilitate an introduction".
Veronica: Yep. That's it.
Michael: So, I'm noting, first of all, you're not asking for referral, it's introduction. So, is there a reason for not saying referral?
Veronica: Only because I think it's one thing to ask someone to introduce you to somebody else that doesn't necessarily mean they're encouraging that person to do business with you. But referral has a connotation, to me, and it may not to clients, by the way. This is where sometimes we get in our own way or in our own head, but you have to find the thing that sounds most natural to you. And to me, the word referral has a business connotation to it, like they would only be giving me that person's name or doing something to encourage that person to do business with me.
Michael: It's like a referral means, "You're going to get the person to do business with me". An introduction is just an introduction.
Veronica: Yeah, exactly. And when you have good relationships with clients, I would hope they would introduce you for a variety of reasons to almost anyone in their network, potentially. Right? And so, to me, it just seems like a little bit of a warmer way to say it. And that's really a personal pick. I'm sure there are definitely clients where I was like...if I said that and I said, "I would love if there was anyone in your life who needed help with those things, if you could refer them to me", or something along those lines, I'm sure it would also go fine. It's just the word introduction seems warmer and it also gives them an action step.
Michael: So, I'm also noticing you don't necessarily put them on the spot because you wrap this with, "We would love if you could facilitate an introduction", right? As opposed to saying, "Is there anyone you know in your life who needs help with estate planning and budgeting for their farm?", and then you just stop talking and let it be silent and wait for them to name some name, like, "Come on, give me names".
I'm struck, you're not leaving it to them that pointedly, you're kind of wrapping with, "We would love if you could facilitate an introduction", so they can move on here if they don't want to hand over names and start this process. You've just set them up to spend some time reminiscing on how great the service value is, so why would you not be helping your friend who needs help with the thing that you just said we're really good at solving for you?
Veronica: Yeah, that's exactly right. And I guess that's more of a me thing too. I know there is this push in the industry of 'get names from people' or 'walk away from a meeting with 2 or 3 names, otherwise, you're not getting it. It's just not very me. To be very transparent, it just doesn't...I would hate to be put on the spot like that by somebody else and I consider myself when I'm happy with somebody's service, I refer everyone in my life to them if I'm happy with them.
And so, thinking about how I would want someone to approach me if somebody was sitting there...and you could take some basic situation…like in a doctor's office, let's say a doctor was building their practice, and they're like, "Can you give me 2 or 3 names of potential patients, future patients?", that's such an awkward position to be in if you're the person on the receiving end. So, I want it to be warm, I want to wrap up every meeting with a client walking away feeling like, "Okay, I get tremendous value out of working with these people or with Veronica, and on top of that, they want to help people in my life". That's the impression I want to leave, not the impression of like, "Wow, Veronica does a great job for me and she's building her business, and now it's my problem to help her" if that makes sense.
Michael: So, when you set this up with they're saying the top 2 or 3 things that you do for them that they find valuable, and then you turn it right around like, "Okay, you said you love estate planning and how we helped you plan through cash flow for your family farm", because that was the big planning thing for them. So, when you now set this up like, "Is there anyone you know in your life who needs help with things you just said? "…again, maybe this is overanalyzing because these are the fearful things we tell ourselves. I feel like I have this fear that they're going to say things that weren't actually the primary thing I'm trying to grow my business on.
And if I asked them for referrals around that, those weren't necessarily quite the referrals I was looking to get or...I helped you with an estate planning thing for your family farm but I wasn't really trying to make a family farm niche. But if I asked you like, "Who you know in your life that needs help with family farm estate planning?", next thing you know, I'm going to have a bunch of family farm estate planning clients. Is that a problem? Am I making this up to be a bigger issue than it is? Because we're not asking them for a referral of what we say we do, we're asking them for a referral of what they say they value. So, I appreciate that they value it but that doesn't necessarily mean that's the thing I wanted to do for everyone.
Veronica: Yeah. So, my answer...that hasn't actually come up for me, that's so interesting that you mentioned that. But what I would say is I just wouldn't ask for the referral. The conversation works if you stop at question 2. If they're like, "Oh, my God, you really helped with the cash flow planning for my farm, that was tremendous", and you could just be like, "Wow, that's great, thank you so much. It was great working with you on that". And you don't have to then ask for additional referrals, you know what I mean? That's a choice.
And so, I guess, I would say the thing that has come up is people will say things that I've helped their kids with, like clients, where we work with children, will say things we help their kids with, and so like, "Wow, you really helped my kid with his medical school debt". I'm certainly not making a niche out of people with debt, so I'm not going to then say like, "Is there anyone you know in your life with a lot of debt that needs my help?", that's not a question...I wouldn't lead into it that way. I would only take it and run with it if it's a referral that if I want that business.
Michael: Okay, fair enough. So, nominally, we're going into this with the goal and hope that we're going to be able to find referral opportunities from every client. But if the path of the conversation is that they're talking about helpful and valuable things that are just not the direction I necessarily wanted to build referrals on, then we just won't follow up with the referral conversation. At worse, did the ask. At worst, we just spent some time reminiscing about how great our relationship is, this isn't going to be bad because we didn't get to the referral question. We did just spend a bunch of time having the clients remind themselves about how much they like us. That's also just good for retention in general.
Veronica: Yeah, that's exactly right. Although what I will tell you is most of the time, the big things you help people with are the things people will mention. That's been my experience. I had some real fear around everyone is going to not think of anything, by the way. That was my fear. So, walking into this, I was like, "What if people say they just can't think of anything that we've done for them that's most helpful or valuable and that's sort of like a flopping question?", you know? That hasn't happened either, by the way. People will, when they're asked such a direct question, come up with something even if they hadn't thought about it before. Most of the things they come up with are something along the lines of, "You helped me with the whole picture and I just trust you and you're great". At worst, someone will say something kind of mild like that.
Michael: Okay. And so, when you follow it here, "Is there anyone you know in your life who needs help with the thing you said was valuable? We would love if you could facilitate an introduction". So, what happens next? They say, "Yes, Bob, my neighbor, also needs help with his estate plan because you guys helped me out". So, how do you take them to the next step? What do they do if they say yes, but maybe they're still not really clear like, "How do I facilitate an introduction? What am I supposed to do? What do you want me to do exactly, Veronica?".
Veronica: Yep. So, my ask is always, "Would you send an email to both of us to make it easy to introduce us?". That's the best way because I have their email address. If I have a moment, it's a client I really like, and they're really eager about the introduction, I'll say, "Do you have their phone number handy? Would it be okay if I call them?". That has worked too. I always send a follow-up note after every meeting and client conversation I have. And so, for me, I would include Bob on the follow-up email, "You mentioned Bob might be someone who could benefit from our services. Again, if you could just possibly send an email to both of us, that would be tremendously helpful". Something easy like that.
Michael: Okay. And then you're running with it from there. So, at the point you do the outreach, is there any follow-up back to the original referrer? Do you send them notes on progress or thank-you gifts if it works out, or thank-you gifts either way? Was there a follow-up that you do back to the referrer after they provide an introduction?
Veronica: So, I don't really. In the next conversation, I will usually say like, "Thank you for introducing me to Bob", in that example, "We've had a great connection and a great conversation and he's been wonderful", something really vague like that. I don't send gifts to clients who refer, really. I have a few times for people who have referred, let's say, multiple people at the same time, which I feel like it's an above-and-beyond thing, so I send a little bit of a Sugarwish gift or something like that, but nothing formal that I have.
But I've had clients who referred 5 or 6 people all in the same time after I asked that question and that, yeah, "Thank you so much for your trust and faith in us and introducing us to so many people you care about in your life". Things like that, I will definitely send a thank you for. But yeah, no big formal process, I would say. And people love the follow-up, they'll ask sometimes, "Hey, I introduced you to Jane and Sharon, how did that go?" or something like that. If they ask, I'll answer however it went, so yeah.
Michael: So, as you go down this road, is this still...I think you said initially with the first question, once every annual review cycle, you would pull out the question around, "Is there anything we're not doing for you that we could be doing that you would find valuable?". Now that you've got multiple questions that you do in sequence, is this still an annual review thing? Is it less often than that because it gets repetitive? Is it fine because people have new answers every year? How does it work on an ongoing basis?
Veronica: So, for clients, it's probably once a year. Maybe a little bit more frequently than that if I feel like we worked on some major projects, I might ask it. So, if we took... I'm working with someone on an estate settlement and we did a review before their parents died, I'll probably ask after the estate settlement is over because it's a lot of work for us and they're super appreciative along the way in that case. But the question has morphed a little bit and I now apply it...as you know because we talked about it in the marketing summit, I now ask everyone the questions, basically, in every conversation, at least the first 2 questions for sure.
How Veronica Adapts The 3 Questions To Generate Referrals From Prospects [37:52]
And I weave it into prospect discussions, COI discussions, almost every time I talk to anyone, I will say, "Is there anything we didn't talk about today that you were hoping we would cover that would be helpful or valuable to you?", right? I just changed the question slightly for what's happening in the moment and then I would say, "What are the top 2 or 3 things we talked about that were most helpful or valuable?", and then I say, "Is there anyone else you know in your life that needs help with those things?". And actually, now I actually get more referrals from prospects, including prospects who never become clients, than I do from clients.
Michael: You get referrals from prospects? All right, wait, so now I really want to focus this further. So, you just adjust them slightly, so instead of like, "Is there anything we're not doing for you that we could be doing?" It's, "Is there anything we didn't cover in the conversation today that you were hoping we would cover that would have been helpful or valuable?". And then, "What are the 2 or 3 things we talked about in the conversation today that were most valuable for you?".
Veronica: Yep, that's exactly right. And so, I focus on that conversation today because a lot of times, I've never previously spoken to that person. So, it works really, really well. By a little bit of background, CAPTRUST is sort of this 2-ton gorilla in the retirement plan advice space. We're the largest fiduciary of retirement plans. And so, we do a lot of participant advice meetings. And so, I will talk to participants of retirement plans and I will help them with their retirement projections or their investment allocations in their retirement plans or answering questions about anything in their financial life, really. And so, that is a way...because we show up to those meetings as retirement counselors. But everybody knows somebody, right?
And so, it's not like we provide a service and then at the end of that conversation, I literally just say, "Is there anything we didn't talk about today that you were hoping we would cover that would have been super helpful or valuable? I want to make sure you got everything you needed out of this". And then whatever they say, and then I say, "Okay, what are the top 2 or 3 things?", and then, "Is there anyone you know in your life or works in your company or anybody else that needs help with those 2 or 3 things you just said?". It's the same questions, they're just a little bit different because it focuses on that question. That day, that conversation is not an ongoing relationship.
Michael: Okay. And it's ultimately really the same question at the end, right? "Is there anyone in your life that could use help with things you just said? We'd really appreciate if you could facilitate an introduction".
Veronica: Yeah, that's exactly right. It's the same thing. But the interesting thing about the prospect part that I found is sometimes people are so grateful, but they're not in a position to hire you for a variety of reasons. They don't want to hire you, they don't have the assets to hire you. We talked to people across the spectrum. But that doesn't mean they don't know someone, and a lot of times when they feel like you've provided them a lot of value...hopefully, they do feel that way. If they feel that way, they're inclined to feel like they want to do something nice for you or something back, so it's an easy ask.
Or for some prospects who...and this is really, really true, the people who have referred the most business are prospective clients that didn't end up hiring us. It's very interesting. But it's like a get-out-of-jail-free card. They can't quite pinpoint may be why they're not ready to make a move at this time or they get cold feet, or we're in a sticky business, right? People don't move from advisors very often, which is a good thing.
Michael: It's almost like they're assuaging their guilt of not hiring you by answering your lovely referral question and now everybody is...
Veronica: Yeah, by sending people who might hire me. It's amazing, human psychology is such an amazing thing. But it's so true, somebody will... I've had people literally tell me, "I would love to introduce you to 10 other people in my life. I can't make a move yet, but you've done so much work for me, is there anything I can do for you?". "Well, yeah, that would be great. I'd love to meet 10 people in your life".
Michael: Interesting. Interesting. Okay.
Veronica: It's been an interesting sort of phenomenon of getting referrals from people who, for whatever reason, chose not to work with us and they give the largest quantity of referrals, I would say. Quality is a different thing, but they definitely give it the largest quantity of referrals.
Michael: And again, I guess the reminder to all of it is if the 2 to 3 valuable things they articulate are not things you want to get referrals for, you can simply wrap the conversation there. You don't have to get to the, "Is there anyone in your life that could use help with those things? We'd really appreciate if you could facilitate an introduction".
Veronica: Yep, that's exactly right. And all the time...people come from all walks of life when they talk to us and sometimes people also don't necessarily know. They might refer you to someone, and this happened somewhat recently, where they think that person is extremely wealthy and definitely needs a financial advisor. But it turns out they're not wealthy at all or if they need a financial advisor at all, right? That happens too sometimes.
And so, sometimes you talk to people who are not good fits but you want to...I always say I help everyone, I treat every single person I meet as if they're already a client regardless of how...in terms of if I'm giving them advice of any kind, I treat prospective clients as if they're already clients or anybody that I'm really speaking to. And so, if there's someone that I'm helping with a debt management plan and that's certainly not a niche I'm going to cultivate, as an example, I would just thank them for expressing their gratitude in the things I help them with and that's it.
How Veronica Serves A Base of 200 Clients [44:05]
Michael: Okay. So, help us understand what your advisory practice looks like overall. You said you sit within CAPTRUST, a very large national firm, there's lots of stuff. But for your practice or client base, however you frame it, what is your advisory practice look like at this point?
Veronica: Yep, so I'm part of the Lake Success office, which is on Long Island in New York. We're 7 senior advisors, 5 junior advisors, or what we call financial advisor relationship managers. The acronym for that is FARM, by the way, if you're keeping track. We need a better one, but that's what it is in the moment. And then we have about 7 people that are operation, service, and admin folks all together, and 1 person that sits on our investment team but works out of our office. And so, I am 1 of the 7 advisors.
I have about 204 client households that are mine that I've brought in and worked on since I started building the business just about 5 years ago, really. And the thing that I think makes us a little bit different than maybe other practices or other offices is all of our sort of junior advisor team works with all of the senior advisors were not directly paired off. And so, of the 204 clients, all 5 of the junior advisors work on some subsect of all of them. The client always meets with the same 2 people, but I don't only work with 1 other person.
Michael: Okay. So, what does this add up to in terms of assets or revenue, however you measure?
Veronica: So, as of yesterday, it's about $360 million in assets under management and about just over $3 million in revenue.
Michael: Okay. And so, that's a lot of clients, just a sheer number of people to be meeting with. So, what does the service model and engagement look like in the firm for a client base like this?
Veronica: Yeah, so I'm on the higher end, I'm actually working on sort of...one of the challenges I'm working on in an ongoing project is sort of with the junior advisors that have worked with my clients for a long time and actually transitioning clients to them. Our goal is actually to cap each of our senior advisors at around 150 clients. My business has just grown really, really fast. I guess that's an oath to the referral strategy we're talking about, but it is that. And so, I'm working on sort of shifting that.
In terms of service, I or the junior advisor that works on the client calls, we call each client at least once every 6 weeks just for a 10-minute check-in conversation to say, "Hey, how are you doing?" For newer clients, and we're going to talk about this on the planning summit, we have a 12-month sort of blueprint and a calendar of what we take our clients through. And then really, for the first 2 to 3 years, we do quarterly reviews. After the 3rd year, most people want us to shift to semi-annual reviews. They don't want to hear from us that often. But we push all of our clients to meet with us at least twice a year.
Michael: So, I'm just trying to envision the total volume, 200 clients, 2-plus meetings a year, you've got 400-plus meetings every year. So, you put the little vacation and other breaks in there, so you're still at 10-plus client meetings every week ongoing, is that really what it adds to?
Veronica: Yeah, that's really what it adds up to. So, every day I have approximately 2 client meetings and 2 prospective client meetings on average. Not every day is the same, sometimes it's more or less, but on average, that's what it is.
Michael: So, help me understand what you do versus what the associate advisor does just to manage that sheer amount of meetings and needing to be mentally present for all the different things you have to be mentally present for when there's that many clients and that many prospects on a continuous basis?
Veronica: Yep. So, for the most part, I have to say I'm really, really lucky, and part of this is intentional. I also manage the junior advisors on our team, so all 5 of those fall under me and I'm really focused on their growth and development, it's a big chunk of what I devote my time to. So, I'm really fortunate in that for the most part, everything that gets done for a client, whatever we decide, because we do all the meetings together, our junior advisors and planner team actually does. I kind of am the face that shows up to the meetings and talks to people and I get to deliver it and answer questions and solve problems. And a lot of the times...and we're getting to a point with some of our advisors that have been here longer, they're really stepping up and owning the relationship.
So, while both of us would be on the call, they would actually be delivering the majority of the information and the service and the call and I just chime in here and there. And my big thing is just to show up prepared, having reviewed everything that was put together so I know exactly what's going on with the client at any given point. But most of the actual planning, analysis, day-to-day work, anything we have to actually do for our clients is done by our planning team. I'm mostly like I head up the relationship, I take ownership of any problems, so I'm a big "take the blame, give the credit" person, and that's really what the difference is in that regard. I'm really lucky with the setup that we've created here.
Michael: So, on the one hand, I get it, you've got a layer of junior advisors that are increasingly kind of supporting on the client relationships, so you can handle 200 clients plus the growth plus actually managing and helping to develop the advisors themselves. I guess I am curious, though, why the pooled approach and not a particular advisor or 2 that just works with you directly on all of your clients? Why the mix-and-match rotating approach?
Veronica: So, that's a little bit due to how our practice is set up. So, I mentioned David Schwartz who started the company 42 years ago, and he has someone who's supported his business for a long time. He's not, for example, in a growth phase of his business, but working with him and his clients, even though he's in sort of a sunsetting, for lack of a better term, situation, allows you to learn how to keep...as a servicing advisor, how you keep clients for 42 years and how you cultivate those relationships and make sure when somebody passes, the assets stay in the firm and all of that. David's brilliant and has done such a great job building those relationships.
At the same time, if you're just a junior advisor who's working with that book of business, you missed out on working on business development, which is a really, really important skill as well from our perspective. And so, because our business is interestingly sort of half and half, where half of the advisors are sort of sunsetting and half of the advisors are in growth phases of their business, we found for the growth and development, it's better for everybody to work with everybody, at least to some extent. It is not quite exactly like they spend exactly 20% of their time, for instance, with each person, somebody has a primary person they lean on and stuff like that.
But it allows for better growth and development of the junior advisors. If you think about somebody who would have been working on a sunsetting book of business for a long stretch, for a long number of years, and then they would have to pivot to business development having never seen somebody else do business development, it's a harder pivot. So, we found actually just spreading it out works better for the growth and development, if that makes sense.
Michael: Is that challenging for you as a senior advisor, though, because different associates support you in different ways or show up in different ways in the meetings?
Veronica: Yes, I have to keep a list on my desk of all my clients and who works with them because I wish I remembered all 200...
Michael: Well, yeah, it's so many people, you can't even remember who's got what and which.
Veronica: It's just not who, but I actually do know, for the majority of my clients, who they work with, and it kind of like starts to stick after a while, as long as the person doesn't change, right? I kind of started to associate families with a specific junior advisor in that regard in terms of my mind. It is challenging, it's one of the complaints I get from the senior advisor because it's something I sort of implement to the other senior advisors, it's something I sort of implemented in our office for the reason that I kind of just mentioned is it's hard to pivot sometimes if you haven't had business development experience.
And on the flip side, if you only work with someone like me, for instance, there's a downside to that too. Because I'm a growing advisor whose business really just started five years ago, I haven't maintained relationships for 42 years and that's a huge servicing aspect that you need to learn, like how to keep those clients. So, there's definitely advantages and disadvantages to both. It's definitely easier to have just 1 person. But also to be honest, I wouldn't want just 1 additional junior person to work with me because then they would be slammed with 200 clients and that doesn't help anyone either, I think.
And so, part of it is also we...one of the things I'm very conscious of is definitely making sure each junior advisor is limited to 150 client households that they work on. So, I wouldn't be able to have just 1 person anyway at this point. But in either case, I think it's to their advantage to work with the other advisors. And we all have different niches, different subsets. And when you're in the sort of paraplanner/junior advisor phase, I think the more you can learn, the more you can pick up, the more you can kind of refine what you're interested in and what you're good at and have exposure and experience, sort of the faster you can run when it comes to maybe wanting to develop your own business.
And that has actually panned out, I have to say. So, before I took on managing our junior planner or junior advisor team, we probably had 1 out of 5 that were interested in building business and really pivoting towards that. Now we have 4 out of 5 of our junior advisors, all pivoting towards business development. And that's not a factor of any miraculous thing I'm doing, I think they just have exposure to people who are doing it, which makes it seem like a much easier hurdle to climb on their own.
Michael: And so, how are these positions, if I can ask, structured from a compensation perspective? Are these folks all salaried? When you've got this mixture where associate advisors support lots of different senior advisors, how do you set up compensation so that this feels good for everyone?
Veronica: Yeah, so it's salary plus whenever they start bringing in their own business, it's a percentage of the revenue they bring in. It's not a percentage of revenue of any of the senior advisors at all, because David's revenue, for instance, looks dramatically different than mine. And we certainly don't want to create a situation where someone is being compensated just because they happened to work with clients who are older and therefore, have accumulated more wealth, for instance. So, yeah, salary plus a percentage of revenue when they bring in their own business because that's something we definitely want to encourage.
But the big advantage of being in sales, if I may be so bold to use that word, is that you have unlimited earning potential. And we always want to create that even from the early days for advisors, it's like, "You can come here day 1, if you want to start building business day 1, you have unlimited earning potential.
Veronica's Service Blueprint For A New Client's First Year [57:23]
Michael: So, as you do this work with clients, you said that you've got a 12-month blueprint of what you take clients through. I think all of us collectively these days are trying to figure out what these client service calendars and ongoing service models should look like. So, I'm curious to hear more about what yours looks like and how you've evolved it since I feel like we're all collectively trying to figure out how do you blueprint out what we do for clients on an ongoing basis.
Veronica: All right. So, basically, I'll paint the picture a little bit. So, in 2021, I had kind of a crazy business year and I brought in 52 clients that year, which is not the norm. I just want to be clear, I'm not bringing in 52 client households as an individual advisor in most years. In fact, my goal is something like 1 per month. But what happened...
Michael: 'Just' 2 per month?
Veronica: Just 2 per month is my goal, yes. It's a goal, right? But 52 clients in 1 year created chaos. It created chaos for me, it created chaos for...at that time, I had 1 planner that was working with just me, it created chaos for him even though I love him to pieces, he's wonderful. It created chaos for our operations team. We did not have the processes in place to bring on 52 clients, and most of them...like 12 of them came in in December, it was just chaotic at best.
Michael: "Hey, we've been meaning to figure this out this year and it's almost the end of the year, so Veronica, can we come on and get started before the end of the year?". "Sure".
Veronica: Yeah. And so, for my sanity and for everybody else's sanity, I had to come up with a process because I was like, "I don't want our growth to be limited by the lack of systems and processes". We had an onboarding checklist and things like that, but in terms of like what the client experience looks like, what are we doing...52 people come on in 1 year, what are we doing with all 52 people? How do we keep track? How are we servicing them? What does that look like? We did not have that in place. And I brought on my very first client in February of 2019, so it wasn't like in 2021 I've been in business for so long. We just didn't have them, this wasn't a growth rate that we had ever had. And so, we did it...
Michael: And just to clarify, all that growth was basically you finding this 3-question approach and just repeating it over and over again, and it was driving that much activity.
Veronica: Yes, yeah.
Veronica: And also, I will admittedly say that at the time, it was me also agreeing to take on clients that were not really amazing fits. I was in a growth phase of my business and I was kind of just saying...anybody that wanted to hire me, I was agreeing to hire them. I didn't figure out my niches at the time. I was in the baby infant steps of business development. I was like, "Oh, my God, all these people want to hire me, of course, I'm going to take them on", you know? And so, I took on really small clients, I took on clients...relatively speaking, and I took on clients like anyone basically that would hire me. So, full disclosure on that too, just to be clear.
Michael: Fair enough, fair enough. These are the things we occasionally do to ourselves.
Veronica: Yeah, yeah. Look, we are our own worst enemies and I think it's important because I think a lot of people go through that. It's like how do you say no to a potential client? And I did, I struggled with that. So, I didn't say no that year and everybody came on board and I was like...I was kind of having a party but also not, for lack of a better term, and driving my team crazy. So, the blueprint...and I was like, "Okay, we can't do..." Our prior process had really been, "Do everything out of the gate for our clients". So, as soon as they come on board, do their estate planning, do their taxes, handle their insurance, get IRRs, get on the phone with their accountant and their T&E attorney, let's talk about charitable stuff, do everything all upfront.
And so, the first 2 months of a client relationship, we would just be like full-on deep diving into everything going on with them, super intense, and then it would be like kind of smooth sailing after that, right? And so, we had this whole like, "Just make it through the first 2 months," of every one of these chaotic 52 clients, right? Which doesn't work when you bring on 12 in 1 month, just to be clear. And we don't have in our office a service model where we do different things for different level of clients. We provide full, holistic financial planning and do the same thing for every client, regardless of how much they have in assets. Whether it's $500,000 or $50 million, we do the same thing.
And so, I was going crazy that year. So, I was like, "Who says we have to do all of this work upfront? Let's come up with what are we actually doing for all our clients. What are all of the components of the financial plan? Let's build it out and let's make it that each one of those categories spans 1 to 2 months. Why does it have to be all upfront?". And then we built that same process out in Microsoft Planner, which I would say I'm a little bit of a power user of Microsoft Planner in terms of tech tools because it worked great as a checklist, right?
We create a board for every single person. If you've ever used Trello, Microsoft Planner is somewhat similar. And basically, we put everybody...we created a planner for everybody and we would just use it as a check through each month, and then it also helped us manage client expectations. They weren't expecting that we would do all of their financial planning up front, we spread it all out. It was very clear and really neat as a tool and as a calendar, and it brought sanity to the business.
Michael: So, can you help us understand more how does this work? What things are on the list? How did you spread them out? Is this literally multiple meetings and you now have like...you said each category is every 1 to 2 months, do you have 6 meetings with the client the first year now because you're spreading all this out? How did this work?
Veronica: Yeah, and the interesting thing is, we found we were doing that anyway. The first year...and I think other advisors will agree, the first year of a client coming on board as a client tends to be the most time-intensive year where you're trying to do everything. And like I said, we call all of our clients once every 6 weeks anyway, which if you do the math...6-ish weeks, let's say. If you do the math, that comes to about 6 to 8 times a year that we call them. So, it's not radically different from that anyway. But basically, in the very beginning, it's your basic stuff.
So, we outline it as the very beginning, we're opening your accounts, we need all the paperwork that we need, we transfer outside assets. And then Months 1 to 2, we focus on crafting your investment strategy across all of your accounts, rebalancing them, creating allocations for retirement accounts that maybe we don't directly manage but we we oversee everything, and then we make sure we spend time making sure we have all of your financial planning documents: insurance policies, tax returns. We do a technology orientation in the first month or 2. So, that's all like Months 1 and 2, and we do get to know their CPA and attorney upfront. And then Months 3 to 4, now that we've had the introduction to the attorney, we'll do everything related to estate planning.
So, we'll review their existing documents if they have them, if they don't have them, we work with a T&E attorney to implement any estate planning that needs to get done. Then Months 5 to 6, we focus on insurance review and planning, so life insurance, disability, long-term care, property and casualty insurance, health insurance, umbrella liability, we go through it soup to nuts over that 2-month period, talk to any brokers they have, all of that. Month 7 to 8, we focus on a tax strategy review and planning, we review their prior years, usually about 3 years' worth of tax returns, and get on the phone with their accountant. And by the way, the timing of this matters, any of these can be arranged in any order. If I was bringing on a client today, we would do tax planning first rather than estate planning.
Michael: I was going to ask if this modular and flexible about the sequence if only because the client comes on board and says like, "Hey, my hot button is insurance, I know my P&C stuff all messed up, and my kid just turned 16 and started driving, I'm freaked out about it". So, you can pull that forward if you need to.
Veronica: Yes, that's exactly right. That's exactly right. We've shuffled them around and that's where Microsoft Planner also helps because each of these sort of modular things is a bucket in Microsoft Planner and you just rearrange the buckets in whatever order it is for the client. So, I don't have to remember actually what they said was most important for them, we just kind of like run through it that way. So, it's Months 7 to 8 typically, and then Months 9 to 10, and what I always say is...when I walk through this with a client, I always say, "Just assume you come on in January, so take the order with a grain of salt".
Months 9 to 10 is what we call holistic financial planning review, college planning, marriage/divorce stuff. If they have a prenup, we want to look at it. Mortgages, we go through document retention, and we do a love letter and an ethical will for a lot of our clients, Medicare planning if that's appropriate. And then Months 11 to 12, charitable giving planning, revisiting all of the assets, income, expenses, and goals, and sort of putting a nice bow on anything that hasn't been touched like optimizing Social Security benefits and things like that.
And then we have our first annual review. And the other full disclosure thing is, now that we've broken it out and we're not trying to do all the things at the same time, a lot of times these things take longer than a month or 2. Sometimes, estate planning discussions can go 4, 5, to 6 months. So, sometimes this isn't a 1-year plan, it's an 18-month plan, for example. And clients and prospective clients all love it because it's just having a plan in place that matters for them. It's not like a, "We're going to do everything", it's a, "We're going to take each step at a time and make sure we dot our i's and cross our t's", and we're really, really strategic about it.
Michael: And so, do you actually...do you show that to clients, or it's just what you're literally tracking to take them through? Upfront, is this part of the initial prospecting or initial client process like, "We're going to be doing this over 12 months, here's all the things".
Veronica: Yep. So, we show it to clients. We show the clients' first year, the clients become a great marketing tool, which again, was not what it was set out to do but it has become that. We show it to almost every prospective client, we walk them through it. It just demonstrates that we have a process, a very clear one to make sure we address every area of your financial life.
Michael: So, I guess out of curiosity, is there a version of...is there a template of this that you can share just for people who are listening and want to visualize it? I'm assuming if you show it to prospects, there's like a generic sample client version.
Veronica: Yes. Yeah, absolutely. None of them are customized to the client upfront, we just show the client's first-year journey. And then really what we're customizing for clients ends up kind of being done in Microsoft Planner on our end where we just move the order around of which way they want to focus on things and we're going to focus on things. And a lot of that depends on the time in the year when they come on board and then some of it also depends on them and what's the hot button, as you said, the hot button issue for them.
Michael: Okay, so for those folks who are listening, this is Episode 358. So, if you go to kitces.com/358, we'll have a link out to, I guess, the first-year blueprint of all the stuff that you go through in the first year and how you actually show it to clients. So, Veronica, I guess I'm also wondering, does this tie back to your CRM? Most of us, I find, manage workflows and checklists in our CRM. You're describing something that sounds kind of checklist-y but it's in Microsoft Planner. So, do these tie together? Do you have to live in 2 systems?
Veronica: You know what? It's so funny you asked that question because it's a project we're working on to make them tied. We use Microsoft Dynamics as our CRM, but it does not talk to Microsoft Planner.
Michael: Oh, come on, Microsoft. They're all yours, make them talk to each other.
Veronica: I know, right? Or our IT team has not managed that integration, either one of those things, by the way. But right now, it's in 2 separate systems. But what Microsoft Planner does allow you to do is it allows me to assign whoever the planner is to that client, by the way, to participate in that blueprint and assign tasks right out of Planner and they go to that person's email. I can actually also send calendar invitations and that goes right into Outlook.
But it does not integrate with our CRM, so we have to reenter the data at the moment and yes, that is something that's a pain point. It's just when you're building out a rubric if you've ever used Trello, when you're building out something that's like you want to keep a flow going, Microsoft Planner is just really good at it and it makes sharing easy where Microsoft Dynamics is not good at it. I've tried in 20 different ways to rebuild this in Microsoft Dynamics and it's not friendly to that.
Michael: So, in terms of this year-long process, I feel like for a lot of us as advisors, there's this pressure with the new clients to just do the stuff, show the value, right? I think part of why the first-year planning process is intensive is we're trying to show the value of planning upfront and there's just a lot to cover, so there's a lot to get through. And you don't want the client to lose momentum and engagement. If they signed up and they're ready to go and get going, then often, we want to keep their momentum and keep them going.
So, I guess I'm just wondering, in practice, what's it like as you've...I guess this is my words, but slow down the first-year process where like, "Hey, we're going to do this in 12 months, not 6 to 8 weeks", which is what a lot of advisory firms try to do to get through the first-year planning process? What's it been like... what's the client response been as you've slowed down this first-year process and structured it out as far as you have?
Veronica: Yep. So, what I'd tell you is new clients have no idea how you used to do it, right? That's sort of like the easy thing. And if you set expectations up front like, "We're going to take it one topic at a time, we want to make sure we're extremely thorough on each thing that we get into", and you frame it in a way that like, "This makes sense and we know these things take as long." And by the way, I do tell clients that, "Sometimes this becomes an 18-month process because certain things will take longer like estate planning or..."
Michael: So now, all of a sudden, if you do it in 12 months, you are doing it fast. This isn't slow, this is fast if you get through in a year.
Veronica: Yeah, exactly. And some clients aren't as complex, sometimes they're like, "Well, maybe I'm single and I just need a power of attorney, so estate planning is not going to take me three months to get through", right? So, sometimes it is a little faster, but it varies. I think if you manage the client expectation that this is a reasonable thing and you have a plan and you have a blueprint for it, it also gives them peace of mind that you're keeping track. So, I share my planner with the client as we go through it and say, "Okay, here's everything we've done, here's what's still outstanding."
Michael: So, literally within Microsoft Planner, you're sharing the document thing to their email address and they can see how it's progressing?
Veronica: Yep, that's exactly right. And like with anything else, if you set the expectation that we're going to get through all of your planning in 6 to 8 weeks, now they have that expectation, if you set the expectation that it's 12 to 18 months and 12 months is actually pretty good, then that's their expectation.
Michael: And clients who have urgency to get through stuff faster, to get through particular things faster, you just rearrange the modules accordingly as needed.
Veronica: Yeah, that's right. And look, if we come into somebody... we've all had that person, flexibility is key in this business too. If somebody is like, "I know I'm just talking to you, but actually, I've put in for my retirement and my last day here is in a week", well, there is urgency created by them having done that, and yeah, now I have to go figure out everything to do with their retirement much faster than I wish I did. But it's fine, we work with that. If you used to do...if at some point you managed to bring on 52 clients and do everything for them in 6 to 8 weeks, now trying to do half that number of clients and most of the time you have that 12-month runway, it gets much easier.
What Surprised Veronica The Most During Her Advisor Journey [1:15:11]
Michael: So, as you reflect back on this journey, what surprised you the most about building your advisory business and your book of clients?
Veronica: So, I struggled a lot, Michael, I have to be honest, in the beginning because when I started building business, I was 28 years old. And if you've ever done estate planning for clients, attorney sometimes will draft language that's like, "Full distribution to a kid at age 35". And we used to sit, and I used to be in meetings with Alan and he used to tell clients, "35 is way too young for your kid to be inheriting so much money and managing it". But here I am at 28 years old trying to build a book of business, so I had a lot of what I'll call garbage in my head around being too young to be successful.
And I didn't...I stumbled a lot, I fumbled a lot. I had great examples and great mentors and running around with Alan for 3 and a half years and watching him build business was certainly really, really helpful and an amazing mentorship experience. And at the same time, I had a lot of garbage in my head around, "People will never hire me," and things like that. I've had lots of setbacks. The same way I had really good business years, it's like I had really bad business years. And I think what's been most surprising to me, and I guess this is more most surprising to me about myself, is my sort of relentlessness for lack of a better term.
I knew when I set out to start building a book of business...and I had been a paraplanner for so long. At the time, being in this industry for 15 years, I supported other advisors for 10 of them. And I knew that I had the technical skills, I've been listening to Kitces for as many years, and I knew I had the technical skills and I knew all that, but I had so much nonsense about being so young. But at the same time, not succeeding was not an option for me. My first 2 years in business, I had this goal that every single day of the calendar year, so 365 days both years, I would find 5 people a day and tell them what I did and why they would hire me or why they should work with me.
And sometimes, I gave pro bono library talks, I did a lot of CFP Board pro bono work and talked about me. It's just a way to just talk and get that experience. And sometimes, I would drag my husband to Target at 8:00 p.m. at night to find random people in the aisles and talk about what I did because I'm committed to finding 5 people a day and telling them what I did, no matter what. And I did it for 2 years.
And by the way, in '22...because if you're keeping track, 2020 was the second year of that, it got a hell of a lot harder to find 5 people a day when the world shut down. But I did. In 2020, I guested on 72 different podcasts, totally random things too. I went on and talked about the CARES Act and other things. And I gave lots of pro bono virtual classes for different nonprofits on financial planning. I found ways to tell 5 people what I did every single calendar day of 2019 and 2020, and I did it no matter what it took. And so, I found this sort of relentless determination within me that I didn't know I had, that was probably the most surprising.
Michael: And this goal of tell 5 people a day, what you did for the better part of 2 years, just where did that come from?
Veronica: Made up entirely.
Michael: Which is like this is a line you drew for yourself, and then wouldn't let yourself not follow through and cross the line?
Veronica: Yeah, that's exactly right. It was 5 people a day. And at the time when I had joined...now, CAPTRUST has about 1,500 employees nationwide. At the time, we only had about 400, I think. And so, inevitably, 4 out of the 5 people or so, 3 out of 5 sometimes would be people who worked at CAPTRUST. I was just calling some random advisor in Louisiana, like, "Hey, I don't know what your practice is about but I'd love to introduce myself and tell you what I do."
Michael: And what was the goal for yourself? To literally practice the speech? The pitch? Or something else?
Veronica: No, just to talk to people, get to know people. Like I said, CAPTRUST has a big institutional practice, I wanted to get to know institutional advisors. I know they did something different than we do on the wealth side and wanted to see if there was some way to build relationships that could be equally beneficial. If they knew somebody that needed some advice, back to my earlier point of everybody knows somebody, it was literally just to get connected.
And the funny thing is that I met somebody in Target, which I used sort of as an example, at 8:00 p.m. at night one time who introduced me to a local accountant, like it was their niece or nephew is a local CPA that I didn't know. Then that became one of the 5 that I spoke to another day, and that accountant has become a tremendous referral partner. And it wasn't the person at Target, but it was that conversation that led to it. And so, back to my earlier point, I didn't have a personal network, I didn't know where to start with building business, so I was just on a mission to meet people and talk to people.
Michael: And so, I was going to ask what changed for you as you went through those 2 years? What was different for you at the end after doing it than where you were at the beginning?
Veronica: First of all, I had some clients. That was different. So, I managed to get some clients, some relationships. I built some pretty good relationships with some centers of influence during that 2-year period that I was introduced to. There was just a lot in that regard that was tremendously beneficial. And then related to that, I think what also changed was my mindset and understanding about why I was doing it. In the first year or so, the very beginning, I was like, "I'm going to just go out there and tell 5 people a day what I do, what's the worst that can happen?"
And then as I was closing up on the 5 years, I became more strategic about asking for people I want to meet. So, if people were not...if people were like, "Great story, but there's nothing we could do together," I would actually ask them, Target or anywhere else, by the way, "Is there someone you know in your life? Do you love your CPA? Do you have a trust and estate attorney you love? Do you have their phone number? I'd love to just get in touch with them". And so, it became...over time, I became more and more specific about asking for what I was looking for.
The Low Point For Veronica On Her Journey [1:22:35]
Michael: So, what was the low point for you on this career journey? You're 15-plus years in now.
Veronica: Low point. So, in 2015 when the Obama administration was looking to push through the fiduciary rule, I got picked up by a large broker-dealer out of a small RIA because they were hiring specifically CFPs out of RIAs. And I got placed with this advisor team that wasn't really looking to meet any fiduciary obligations, but of course, with large broker-dealers, there's a metric for everything. So, they came out with this KYC metric, know-your-client metric, that you had to have a certain amount of information about every one of your clients in the system.
And then if you met it by a certain date, if that advisor met it by a certain date, that advisor would get a bonus. And so, my entire job on that team became not focusing on delivering financial planning to those clients but helping this guy get a bonus by whatever means necessary. And I got into this business really early on because somebody took sort of financial advantage of my grandfather, and I really believe morals and ethics are always top of everything that I do.
And so, I had such a mismatch with this advisor team that I worked for. The guy didn't know anything about his clients. He sold portfolios but didn't even know if his clients...if his clients had children, didn't know if they were married. Really basic in the RIA…what I would consider basic knowledge about clients. Didn't know anything. And at some point when...because I was just calling people who didn't know me, it wasn't like a warm and fuzzy thing, he didn't introduce me to his clients in a warm way. I was just supposed to call people and ask them all these personal questions about them.
Michael: So that you could fill out the KYC details.
Veronica: So I could basically complete their "financial plan" in the system and enter that information, and the numbers weren't moving up fast enough for him because he had no KYC information on any of his clients. So, the metric was something like, "Get to 70% by November 15th", and I had started there on like, I don't know, September, 5th or 6th or something.
And the numbers weren't moving fast enough, and so he told me to make stuff up just to move the metrics up, which goes against every fiber of everything that I believe in and I refused to do it. Essentially, had a really tense few months. He didn't get his bonus. I said, "If you want to make up stuff about your clients, you do it yourself, I'm not touching that with a 10-foot pole". And I had left that position by the beginning of March, so I survived a few months in that broker-dealer role but I got really physically sick being...he wasn't very nice about it.
He was constantly telling me like, "You're worthless", "No one's ever going to work with you", "You have to do whatever it takes ", "You need a different attitude". It was just a terrible, awful, gut-wrenching experience. And you're always told, "You got to survive at least a year somewhere, otherwise it looks terrible on your resume". And so, I started looking for jobs but I had only been there for a few months. I knew I needed to go back to working for an RIA as quickly as I could, and that was definitely by far my lowest point in my career.
What Veronica Would Tell her Younger Self And Junior Advisors [1:26:22]
Michael: So, what else do you know now you wish you could go back and tell you 10, 15 years ago as you were starting your career?
Veronica: I would say what I know now is not to be so fearful about what the outcome is. I think relentlessness and determination will eventually lead to success. When I started in life insurance land in 2008, which was a really fun time to be starting in this industry, I had no idea what my career would turn into. I had no idea what an IRA was or a CFP was or anything. I was graduating from Baruch with a degree in international marketing management, and I had no idea.
I knew I wanted to be in the financial planning space, I knew I didn't want to take advantage of people by selling them crappy annuities. There are good annuities out there, but I didn't want to do that. And I guess the thing I would say is it all falls in place sort of the way that it's meant to as long as you follow your heart, follow your own moral compass on what is right, and kind of don't let anybody sway that because there's a lot of that, unfortunately, in this industry.
Michael: So, any other advice you would give younger, newer advisors who are or maybe getting started with their careers today?
Veronica: Yes, my biggest advice, and I'll give it here too, is if you hear a term, dive in and research it and embrace it. Embrace sucking and not knowing things to the point where you want to become an expert in them. I think what always really helped me is, I don't know, somebody would say something in a meeting or something, or I would hear a term like "rolling GRATs". And then I would spend all evening and if I didn't get it then, all weekend, finding everything I could about GRATs, rolling GRATs, what it means, who it's for, and I would just dive into it.
Never shy away from questions, don't shy away from saying, "I don't know, but I'll find out for you", because I think that's a big part of what we're hired for. And I think one of the things that really sets a truly amazing advisor apart from other people is that ability to just figure things out. Everything is figureoutable and don't shy away from embracing what you don't know and becoming really comfortable with it.
Michael: So, as we wrap up, this is a podcast about success and just one of the themes that always comes up is the word success means very different things to different people, sometimes as our careers and lives evolve. So, as someone who has built up what anybody would objectively call an incredibly successful practice and client base, the business is going so well, how do you define success for yourself at this point?
Veronica: My ability to teach others to...maybe not teach, my ability to guide, grow, and uplift others to do the same or better than me. My biggest success is if whoever I'm working with, the junior advisors that I work with, if they are more successful than I am, then I'm doing something right.
Michael: So, I can see why you're excited to get to work on the development of the 5 on the team there in the Lake Success Success Office and perhaps more in the company over time.
Veronica: Yeah, for sure. It's a big passion of mine and I think any meaningful success has to be what you can give back to others.
Michael: I love it. I love it. Well, thank you so much, Veronica, for joining us on the "Financial Advisor Success" Podcast.
Veronica: Thank you so much, I really appreciate that.
Michael: Thank you.