Wealth Protection

Giving Clients Their Own Board of Advisors

Taking a strong cue from their counterparts, financial services practitioners in the medical field are capitalizing on coordinated care in the corporate world because it has a strong foothold as the best way to deliver services to their patients.

It seems the idea of a roundtable approach – one in which all the skill sets represented in a well-developed financial plan including accountants, attorneys, estate planners, financial planners, insurance agents, revenue managers and tax specialists work together – is gaining ground in the financial services industry as well.

“The current trend in planning, and where we are seeing real value is in linking the relationships among asset protection, tax reduction, investments, insurance and estate planning professionals, with the experts in revenue cycle management,” noted Michael Scott Berry, founder and owner of Michael Scott Financial based in Newtown, Conn. “There is a critical link between these sub-specialties of planning, which requires crafting of a well coordinated plan to ensure an efficient outcome.”

Coordinating these specialties is akin to creating a client’s own board of advisors, except that the board helps other clients as well.

This approach definitely works for clients, especially for those who want and value the advice and input from experts in each field. It also works for financial services firms seeking to create not only a better experience for their clients, but also consistently flowing revenue streams as part of their business model.

“It is similar to what has occurred in the medical profession,” Berry explained.

The bulk of his clients are physicians and medical practices. They are professionals whose biggest obstacles aren’t related to their advanced training, enabling them to diagnose disease and recommend treatment. At this juncture, physicians who are solo practitioners, or in partnerships of 2-50, are more challenged with keeping cash flow and revenue streams moving along. This is especially true as we see increases in government regulation and the expenses of compliance, fee compression, employee benefits, competition and the basic costs of doing business. Also just as important and hovering in the background, are impending tax increases, threats to the US and global economies and a general lack of trust in financial services.

“Today’s medical clinic is not the same as your grandfather’s practice,” Berry said. “In the past, physicians made most of their money from clinical work. Today, they earn only a portion out of clinical. Today, they own the ambulatory surgical centers, the laboratories, the pharmacy, the dispenser of durable medical equipment – and they even own the real estate where they have their offices. They have created LLC’s and multiple streams of revenue based on these platforms from which they dispense medical advice.”

Berry sees how the same thing is applicable to the financial services industry – and particularly to his firm, where the use of a team approach toward managing clients’ financial needs is already the norm.

He knows that in today’s business environment, where instant communication and instant gratification dominate, speedy responses to client concerns and questions must be the expectation and not the exception.

“Clients expect response time to be quick,” Berry emphasized. “Response needs to happen immediately, and you must have enough infrastructure to do so at lightning speed.”
That is where Berry’s partner, Lindsey Cruz, enters the picture. She is the firm’s executive director, and quite often is the one who delivers the “lightning speed” customer service that Berry refers to.

Berry said clients often call just to talk to Lindsey, which is completely fine with him.

“Every day, Lindsey and I work diligently to be more valuable to our clients than we were the day before,” Berry said. “Our firm cannot do what it does without good employees, good colleagues and competent specialists – and Lindsey is a major part of what works here. It is imperative to have the right values-oriented people serving your clients the way Lindsey does.”

Figuring the best financial plan of action in today’s volatile market place isn’t the easiest or simplest task. It becomes even more difficult when attempting to factor in a client’s longevity. There really is no “best guess” as to how long someone will live. There is no crystal ball to gaze into that can determine if a client will need long-term care.

“It is the biggest challenge that we have as planners right now,” Berry said in reference to the task of helping clients make their money last until their passing. “As a planner, the best I can do for a client is to put them in a position to make a better decision.”

According to Berry, that “better decision” often is a move toward transferring the savings-draining risk of long-term care to an insurance agency. He explained how today’s hybrid life insurance policies with long-term care riders are “fine” tools for handling that concern, and provide flexibility and control.

“These aren’t easy conversations to have,” he said. “No one really wants to admit they won’t live forever.” But, in Berry’s opinion, “good financial planners are having these tough conversations and then are using hybrid products to address what could happen under these circumstances.”

It’s about giving the client peace of mind that life’s financial twists and turns will be taken care of.

This is the same approach Berry takes toward fee disclosure with clients. He knows that increased regulation regarding fee disclosure can at times only further confuse clients.
He also knows that some in the industry, in government and in watchdog agencies question whether current fee disclosures go far enough to inform clients.

Berry’s approach is simply this: “When a client asks, tell them. When they don’t ask, still tell them. Put it out on the table. Get it out there. Be client-centric. Put it out there from the start.”

Learn more about Michael Scott Berry and Michael Scott Financial online at www.mycpo.net or www.msf-advisors.com

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