How Do New Financial Advisors Develop A Specialty?

This business is tough to break into. 80-90% of new advisors fail. With stats like that, its easy to see why most new advisors will meet with anyone who can fog a mirror.

You’re different, though. You think there must be a better way. Why else would you be reading this, right?

Choosing to specialize as a new advisor is a gutsy move with a big potential payoff. As a new advisor, your practice is a blank slate to mold with intention, but you lack experience and certainly wouldn’t consider yourself an expert. So, what do you do?

Consolidated Planning helps financial advisors grow bigger, better, and faster using a proven practice building playbook that guides new to help 125 families or businesses over five years and earn $250,000 annually as a byproduct. Our process includes coaching advisors to develop target markets and specialized services. We’ve helped advisors become the trusted expert in dozens of different niches by delivering tailored advice and service.

We’ll focus on the behind the scenes look of creating a specialized practice to give you a clear picture of what it takes. By the end, you’ll know what steps to take when you’re ready to go narrow and deep as a specialist.

Why Do Financial Advisors Specialize?

Imagine for a moment that your target market is pharmacists. That’s a start, but there are over 312,550 pharmacists in the US. To stand out, you need to go deeper, so you narrow your focus and specialize in working with pharmacists that graduated pharmacy school within the past ten years.

Why would you choose to narrow your prospective client base like this? There are two primary benefits when choosing to specialize: marketing and practice management efficiency.

Your marketing and prospecting efforts are simplified when your practice serves a target market. Continuing our example, your marketing messages don’t need to speak to everyone or even all pharmacists. Instead, you can speak directly to issues that impact young pharmacists, like balancing student loan repayment with building savings. As a result, you can market your practice more effectively after developing a target market.

You’re going to love how efficiently your practice runs when you specialize. This benefit is often overshadowed by the marketing benefits of specializing but is no less important.

When your target market is narrowly defined, your clients will have similar financial circumstances and challenges. This means you can create client services models that hone in on the specific needs of your target market, allowing you to deliver a bespoke experience with off the rack efficiency.

Simply put, specializing allows you to give your clients and prospects a better experience while making your life smoother. At Consolidated Planning, we call that a win-win.

How Do Financial Advisors Specialize?

Now you know why you would want to specialize, but how do you actually do it? This article will focus on the nuts and bolts of establishing a specialized practice from a knowledge and infrastructure perspective.

Let’s assume you have already chosen a target market and want to know what to do next.

Partner With Experience

The scariest part about becoming a specialist is the self-doubt that can creep in as you start. This is especially true as an inexperienced advisor. After all, how can you be a specialist when your experience is limited?

The answer: outsource the experience.

The best way to build confidence and gain knowledge when starting to specialize is to partner with the experience you lack. You can do this a few ways:

• You can partner with another financial advisor that works with the same type of clients. The challenge here can be finding the right advisor; this may not be feasible at smaller firms.
• You can partner with a firm that specializes in your chosen niche. Many boutique financial services firms work exclusively with specific target markets. However, these options may be limited in your area, or they may not be taking on new advisors.
• You can use Consolidated Planning’s advisor resources like the Advisors Performance Group (APG) and Business Owner Strategic Solutions (BOSS) to gain access to specialized planning solutions. These resources exist to build your confidence as an advisor through strategic coaching and support.

Consolidated Planning advisors benefit from our collaborative culture and our advisor resources. We provide you the ability to bring in additional experience on any case through pre-meeting consults or side by side joint work and all levels in between.

For new advisors, resources like The Advisor Performance Group and BOSS are gamechangers that suddenly add decades of experience to your bench that can be called up at any moment.

It’s important to note that trust is essential to any advisory relationship. Be honest about your experience with clients and find a partner with experience to ensure they receive the best.

Professional Designations

Professional designations are more than just alphabet soup for your email signature block. The correct designation can give you more knowledge to serve your target market better and make you stand out as an expert. While not required, as a new advisor, a professional designation shows your target market that you are serious about meeting their needs and upping your knowledge game.

Before pursuing a professional designation, think about what would be meaningful to your target market. In our earlier example of a pharmacist who graduated in the past ten years, earning your Retirement Income Certified Professional (RICP) designation wouldn’t make much sense because your ideal prospect is more concerned with paying off student loans and building savings than generating retirement income.

On the other hand, if your target market is business owners 5-10 years from retirement, you would want to consider pursuing the Certified Exit Planner (CExP) designation. The CExP curriculum teaches how to guide business owners through the sale of their business and would be highly relevant for your target market.

It’s also important to consider the cost and time commitments of the designation program you choose. Most designations cost between $1,000-$5,000, including testing and study materials. Some programs require multiple rounds of testing and may take more than a year to complete, while others can be completed in a weekend.

In many cases, Consolidated Planning will reimburse you for some or all of the cost of your professional designation upon successful completion.

Specialized Service Offering

A specialized service offering is key to differentiating your specialized practice. Your service model should proactively address the needs of your target market. This will make you stand by showing how deeply you understand your ideal client.

As you build your specialized practice, refine your planning process to reflect your target market more. If you’re working with younger, tech savvy pharmacists that work 12 hour shifts, they may prefer virtual meetings. If you work with retired teachers, they may prefer the social nature of meeting in person. Adopt their language and ensure your availability is in line with theirs.

The bottom line is to know what your target market wants and needs and build out your service model to meet their wants and needs systematically. Consolidated Planning’s Marketing Administrative Practice Management Solutions (MAPS) Team works with advisors to develop and implement client service models that deliver an exceptional experience.

How Will Consolidated Planning Help Me Specialize?

Specializing your practice to serve a target market is one part of the equation that can lead to exponential growth. It requires you to think and act differently than you have in the past.

Consolidated Planning brings both thought leadership and infrastructure support to your practice. We will help you craft the plan and give you the tools to execute.

Reach out to our team to receive a copy of your practice building playbook to see how specializing can set you on a course to help 125 families or businesses and earn over $250,000 annually within the next five years.

 

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