Do you complete Fee Audits?

Do investors understand the cost of investing? Consider completing a fee audit on your best client’s portfolio. Over the last five years, look at the total amount of fees they paid and look at the tangible (dollar gains, tax planning gains, estate planning gains, advice gains) benefits they received. Then list the intangible benefits they receive by your advice such as piece of mind, comfort, simplicity and trust. This can also be done through feedback questions with your top clients (discussed in an earlier post).This is part of your detailed process to outline your measurable and immeasurable client benefits. I always ask advisors “ Tell me how much income tax you potentially saved last year with your top client?” I have yet to have an answer to that question. Are you telling me that you cannot quantify your value in dollar terms? Build a process that gives your clients and prospects a forward based, five year estimated cost and potential benefits to help you quantify value of your advice. Build your process with feedback, value and transparency to get an edge on the client experience.


Now when you sit down with prospects consider this exercise and discussion. Ask “ Can I do a fee audit for you to help you understand how fees impact your planning? “ Look at the estimated total fees over the last five years that they have paid and in the last 12 months and quantify them in a dollar cost. Then look at the starting investment amount five years ago and the ending investment amount today, including withdrawals. Then ask about their planning processes they have completed, including tax planning, estate planning and financial planning and ask to see the documents. This exercise will help you with your value discussion, but more importantly, showing prospects the total cost and help them understand the total costs in dollar terms. It will also show complete transparency with benefits and will show your prospect instant and tangible benefits of working with you, especially if their current advisor has no process for showing their planning processes, total fees and total transparency, if they show any fees for advice. It will also allow you to discuss your value of your planning processes and your progress update meetings to keep them on track.
Prospecting discussion
Get in a habit of people you come across every day if they understand the fees they are paying. Ask them to explain the fees as they understand it. Then ask” would you be open for me to do a fee audit for the last five years to help you understand the cost (or fees) and benefits? I ask because, we do this for our clients so they understand the measurable benefits of our advice along with our immeasurable benefits that our planning offers such as piece of mind, simplicity of their financial life. Our clients appreciate more comprehensive planning advice through our progress update meetings 3 times per year, a 100 point planning checklist, tax planning, estate planning, financial planning and investment planning ( what services you offer) in writing, does this make sense to you? Our clients have comfort knowing it is taken care of, so they can go on and enjoy the things that are important to them”. Now you have the start of a process to discuss your differences with prospects.
Practice makes perfect
Do you have scripts that you use with prospects and practice them with someone to give you feedback? Do you have a clear detailed process for making your client’s fee ready? If not, who is helping you who has a proven process to help you get there? Find someone who has a proven process and has the time to help you get there. It is not just about content, but it is about practice. Who is helping you practice your scripts? Do you record your practice sessions? Imagine if the “Rolling Stones” band never practiced and only recorded once? Do you record your meetings with your client’s permission? Find a coach, mentor or manager who can help you build your process and help you practice your communication skills to articulate your value. Now go out and practice your fee audit conversation, build your process for converting prospects and providing measurable and immeasurable value to your new clients. for financial professionals

If you want to learn better scripts and would like to have a community of Ideal Clients, then join me this November in Atlanta, Georgia at the People Skills Network For Financial Advisors and for a great discount enter promo code APM1K or email me for more information at