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By David RichmanNational Director, Eaton Vance Advisor Institute

During a recent workshop, a role-play featured a call an advisor had with a do-it-yourselfer investor. The advisor who played the role of the prospective client laid down some valuable "bread crumbs."

Here is a brief glimpse into the call after some pleasantries:

Prospect: "I have been handling my own money for years, investing in index funds. This world seems to have gotten far more complicated and I am not sure that I am completely comfortable continuing down this path, especially since retirement is right around the corner. Don't feel that I have the time to recover at this point from a mistake."

Advisor: "This world certainly has gotten complicated. We prefer to use individual securities instead of index funds. Would you like me to explain why?"

Prospect: "Well, OK."

The advisor proceeded going down the path of explaining the virtues of using separately managed accounts versus index funds. After a few minutes, I stopped the monologue and we had a group debrief.

Take a moment and reflect upon whether you might have taken the call in an alternative direction.

The advisor who played the role of the prospective client confirmed that the advisor missed the "bread crumbs" in his comments:

  • "The world has gotten complicated."
  • "I'm not sure I am completely comfortable continuing down this path."
  • "Not sure I have the time to recover from a mistake!"

Bread crumbs? Each statement felt more like a complete loaf, didn't it? Pay close attention to everything a prospective client says and try to process what seems MOST important to discuss.

Bottom line: When working with prospective clients, try to uncover their big-picture concerns. It will rarely be necessary to get into the weeds.