Being a financial advisor can be a tough job as it is, but then add on to that the complications of managing particularly difficult clients and you could potentially have the recipe for failure. Attracting and retaining the wrong kinds of clients can prove to be toxic for your business. For this reason, the question of whether or not you may want to “fire” a client may arise. The following are few instances where you may want to consider making that move:
The Client Can’t Make Up His Mind
When it comes to making decisions, time is money. When a client starts soaking up an abnormally large amount of your time and nothing comes out of it, some red flags should emerge. Does the client actually have the resources he or she says they do? Are they really willing to make the decision or are they just baiting you?
These kinds of clients can be fine to deal with when you are growing your business. But later in the game, having every single client pester you with no real reason given despite the time you invest with them, they can become toxic to any practice.
The Client Overreacts Every Time the Market Fluctuates
It’s understandable that clients will feel tension when they have their money sitting in someone else’s hands. As a result, financial advisors know that part of being a good advisor is being able to develop consistency in trust and communication with clients.
But when does concern cross the line into paranoia? Unfortunately, there are some clients that will fall into this spectrum of extremity. If a client has to call you every time the DOW jumps up or down a few points or every time a news pundit speculates on the market; it may be a sign that this client is not a good one to keep. Not only does it become unsustainable to deal with these clients over time, but it can become completely disruptive to your practice and emotionally drain you.
Extremely Needy and Particular
Every client is different, but when it comes to a client that has to have every little detail a certain way and has endless amounts of requests; you should be concerned. Part of building a sustainable business is being able to deal with these clients as you scale. If your client starts demanding more and more information, you need to start to evaluate how sustainable they are to the future of your business; even if that client happens to be a big one.
Not every advisor can afford to be picky, but it’s important that as you start to grow your business, that you consider which clients are becoming more of a hassle than they are a benefit. Unfortunately, sometimes there is just no other way around it but to let that client leave.