Hello. I’m Geoff Davey, co-founder of FinaMetrica, a psychometrics-based risk profiling software company. Prior to founding my company, I was a financial planner for 20 years.
In this current market environment, I believe that the number one thing advisors should be thinking about is how to turn the negatives of the past 12-18 months into a positive for themselves and their clients, and into opportunities to convert prospects into clients.
Risk has been very evident recently and many would be unsure about where they stand and what they should be doing. Now is a good time to be doing a risk-based review with clients.
The best place to start a risk-based discussion is with an objective assessment of your client’s risk tolerance - and for couples, individual assessments of both. They and you need an objective starting point now that the turmoil has subsided. They and you need to be confident that their new plans are soundly based, and risk tolerance is a critical base point.
Prospects won’t need any persuading that their risk tolerance is important as is your understanding of it. Your ability to demonstrate expertise in risk tolerance assessment will be a big marketing plus.
The industry standard approach to risk tolerance has always been theoretically flawed and these flaws came home to roost in the Global Financial Crisis.
The only way to make a valid and reliable assessment of a client’s risk tolerance is with a properly-constructed, plain-English, psychometric test - everything else is rubbish!
Take this best-practice opportunity to reinforce relationships with existing clients and build relationships with new clients. If you’d like to learn more about psychometric-based risk tolerance assesments, visit www.riskprofiling.com