Year-End Review: 3 Ways to Improve Client Interaction

By Accuvest Global Advisors

How big is your circle of influence?

One habit of highly effective people

Our travels often take us to Utah, the home of best-selling author, Steven Covey. As with much of America, his book changed the way many think and work. It is no surprise that the Wall Street Journal has called this book “the most influential business book of the century.” Despite being written many years ago, the principles and thoughts still remain insightful and thought-provoking.

The first habit is “Be Proactive.” A concept that Covey uses to illustrate proactivity is the circles of concern and of control. Imagine one larger circle with a smaller circle within. The larger circle is the circle our concerns. This circle might include things like traffic, the federal deficit, or nuclear war. The smaller circle is our circle of influence and it includes things like our personal motivations, our diet, and who we spend time with. The key lies within which circle we grow by dedicating time and energy to it. Proactive individuals focus on areas within their circle of influence. Individuals who focus time and energy on their circle of concern will find their circle of influence to shrink and wither. Below are three areas I believe to be critical to increase an advisor’s circle of influence.

Spending time with clients

The foundation of your success as an advisor will revolve around your relationships with clients. Your clients have entrusted you with a sacred stewardship to help them watch over their family’s estate. When it comes to building relationships of trust there is no substitute for spending time together while you empathize with them and provide them with sound advice and nothing but the pure, unvarnished truth. While it is certainly important that you should be well educated on and aware of relevant issues, trust is earned through contact over time. You can’t control things like whether clients are out referring you to their friends, but your effort to spend time face-to-face with them is within your circle of influence.

Client Education

How do you spend your time with clients? Hopefully, you consistently dedicate a portion of your interaction with them to education. I’m not necessarily referring to deep technical analysis and industry jargon. I’m talking about teaching and reminding clients how you’ve constructed a plan that helps them to achieve their goals. What are the assumptions you’re making? What are the benefits and limitations to your approach? In terms of dollars, how much could their portfolio decline during an average bear market? Will you attempt to time the market, or should clients be prepared to hold fast during a market downturn? Many organizations do fire drills for good reason. Hopefully, your clients know how they should respond and how they should expect you to respond during stressful market events.

You may be the only person in clients’ lives willing to tell them some of the difficult things they need to hear. If you don’t already, you might consider spending time educating clients about some of the difficult tradeoffs that can come with financial planning. Some of these tradeoffs might require clients to:

  • Save more/spend less
  • Work longer
  • Not fully fund posterity’s education
  • Increase the volatility in their portfolio
  • Sell a vacation home

In other words, a client may be able to accomplish almost anything, but not everything. A key role an advisor can play is to help a client articulate and then be reminded of what is required to achieve realistic goals. This approach can help clients to be more proactive in their own lives.

Asset Allocation

There is a wealth of information regarding the relationship between performance and asset allocation. Studies point out that asset allocation is the primary determinant of a portfolio’s return variability at a level of approximately 90%. This leaves approximately 10% of returns to come from security selection and market timing. If you believe this to be true, or that it’s even close to being true, this should be blinking on your “circle of influence” radar screen. Asset allocation is a huge determinant in risk/return outcomes, and it’s completely controllable. You can’t control the markets, but you have the ability to inform your clients regarding the risks and benefits associated with their particular asset allocation.

Sometimes it feels like the tail wags the dog when it comes to client conversations about investment portfolios. Clients often want to talk about world leaders, elections, geopolitical events, natural disasters, etc. However, what if we were able to tactfully shift the conversation from the circle of concern to the circle of influence? What if we could focus anywhere near 90% of those conversations to discussing, debating, and educating a client’s asset allocation?

Every day clients are bombarded with mostly irrelevant financial information that confuses them at best and actively encourages them to make poor decisions at worst. A trusted advisor might be like the steady drip of chemo therapy, fighting against the cancerous information that confronts clients everywhere.


These are just a few areas in which an advisor might focus to increase their circle of influence. As you review 2017 and look to 2018, we challenge you to evaluate and then discard any words, activity, or thought process that would serve to increase your circle of concern (while allowing your circle of influence to shrink away) and to re-direct this newfound energy to grow your circle of influence with your clients and in your personal life.

This article was written by the team at Accuvest Global Advisors, a participant in the ETF Strategist Channel.