So you’ve done it! You’ve left your big firm and started your own advice-based independent financial advising business. Congratulations! But wait, that’s just the very start. I’ve seen too many advisors think that as soon as they ‘hang their shingle’, the business will just start coming in and they will be on their way to success in no time at all. Unfortunately, this isn’t always the case. The mere fact that you started your own business does not guarantee success. If you aren’t focusing on the right issues, thinking the right way, or teaching your clients properly about money, you can still fail.
There’s nothing fun about failure, I can tell you that from experience. However, if you can recognize early on that what you’re doing isn’t working, you’re way ahead of the game. This gives you a chance to make adjustments early when it can still have a profound impact on your business and start incorporating these changes into your daily routine. Have you started your own firm and the results aren’t what you hoped for? Here might be a few culprits:
You’ve Not Committed to Knowing Yourself
No one can be truly successful unless they have deep knowledge of one thing: themselves. If you don’t know yourself, you don’t even know what success actually means to you, let alone if you’ve achieved it or not. If your business is underperforming, it’s a clear sign that you need to take a deeper look inside yourself. Have you developed a business model that aligns with your values? Have you set up your environment in a way that encourages you to succeed? Are you reaching out to those clients who share your vision and values? Before you start pointing your finger at the market or the industry, it always pays to first look in the mirror.
You’ve Not Made the Mindset Shift
Successful advisors base their business advice not on the market, but on the client’s behaviors. Behavior-based advising is all about the soft sciences and knowing how people react to different situations based on their risk tolerance, personality type, and background. If you’re still basing the bulk of your advice on what the market is doing, you’ve not made the proper mindset shift to succeed.
You Haven’t Developed the Right Mentors
When you go independent, it can often feel like you are on a deserted island. This is especially true for those advisors who came from big firms where there were plenty of other advisors around if you had a question, problem, or wanted to hash out a situation with a client. That’s why it’s critical for independent advisors to develop a network of mentors who can fulfill these roles and who you can turn to when you’re feeling unsure of yourself. Without effective mentors, you are relying totally on yourself and that can be a very frightening thing.
You Aren’t Properly Conveying Your Value
Do your clients truly see you as a fiduciary and a partner in their success? If not, they could still view you as a salesperson, and this means you get blamed for all kinds of things like market downturns, underperforming investments, and unachieved goals. As a fiduciary, your clients should know that you’re there to guide them, help them understand themselves and their retirement goals, and provide them advice to assist them in making the right decisions. If they don’t know this, you have only one person to blame: yourself.
When it comes to advisors who are not experiencing the success they expected, I usually find that some tough love is in order. If you find that your new entrepreneurial business is floundering, I encourage you to take a step back and dig deep into your own thoughts, emotions, and actions. If you need more help, consider our Evolved Financial Advisor class to truly elevate yourself as a fiduciary and financial mentor.