common mistakes Archives - Don Connelly & Associates

5 Common Mistakes Financial Advisors Make When Developing Their Storytelling Skills

/ by Don Connelly / Storytelling, analogies and power phrases / 0 comments

Financial advisors are increasingly recognizing the power of storytelling in their practice. Storytelling helps them earn the trust of prospects, build stronger relationships with clients, simplify complex financial concepts, and inspire action. However, developing this skill comes with challenges, and many advisors make common mistakes that hinder their storytelling effectiveness. Here are five of the most common mistakes and how to avoid them.

7 Common Mistakes Financial Advisors Make that Repel Clients

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To be successful, financial advisors must work tirelessly to master their craft while putting in countless hours to build their business. Some have an easier time of it than others because they avoid the many missteps that can drive prospects and clients away. Even the most well-intentioned advisors can sometimes engage in behaviors that unintentionally repel potential and existing clients, creating an enduring uphill battle to grow their practice.

You spend a lot of time and resources to gain a foothold in this business. But if you’re not aware of the crucial mistakes many advisors make in trying to build relationships, you are less likely to avoid them yourself, making your job much more difficult—maybe even impossible. Here are seven common missteps many advisors make that you must avoid to have any chance of success.

You Can’t Be Afraid to Fail. It’s How You Succeed.

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Who doesn’t want to be a success? It’s what people, particularly financial advisors, strive for every day. No one wants to be a failure. But did it ever occur to you that it’s virtually impossible to be a success without failing? Successful people must be very comfortable with failure because they probably fail more often than they succeed. They’re successful because they use their failures as learning experiences to propel them forward.

Yet, many people seem to have such a dysfunctional relationship with failure that they can’t see the value in it, choosing instead to avoid it by not taking the same risks that led to it. That’s not learning. That’s capitulation, which never leads to success.

Are You Working in Your Business or on Your Business? The Key to Growth Is Delegation

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Growing a successful financial advisory practice is one of the most challenging endeavors anyone can choose to undertake. The road to success is riddled with the many mistakes financial advisors make along the way, such as not prospecting consistently, not marketing themselves, or failing to provide their clients with an exceptional experience. These and other mistakes are symptomatic of a much bigger mistake many advisors make: spending too much time working in their business and not enough time working on the business.

Advice for New Financial Advisors – 8 Things Veteran Advisors Wish They Knew When They First Started Out

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“Experience is the best teacher. But only a fool learns by no other.”

This is a slight misquotation of Benjamin Franklin. But the idea is sound: We all can and should learn from the mistakes and experiences of those who came before us.

And advisors are certainly making mistakes! Somewhere between 70 and 90 percent of financial advisor trainees are out of the business by their fourth year. And too many of those who survive aren’t thriving.

So we asked some veteran financial advisors what they wished they knew when they first started out in this business, or what they would do differently if they could start over. There was a lot of variation in the details, but most of them had these themes in common.

Reasons Clients Need a Financial Advisor – Overcoming the Do-It-Yourself Objection

/ by Don Connelly / Investing Wisdom / 0 comments

We’ve all encountered them: The prospect or client who wants to go it alone. They want to manage their own portfolio.

Well, here’s one approach you can use:

First, ask the question, “Can I share something with you?” (I like this phrase because it’s non-confrontational. It doesn’t activate the prospect’s ego, leading to an argument you can’t win. It neutralizes it.

Then you can show them the latest DALBAR study.

It doesn’t matter much what year you use. The results for individual DIY investors are almost always dismal: According to the 2019 DALBAR Quantitative Analysis of Investor Behavior, the typical do-it-yourselfer achieved an annual real return of just 1.71%.

Compared with the S&P 500, do-it-yourself investors lagged the S&P 500 by huge margins:

• 4.35 percentage points, annualized, over five years;
• 3.46 percentage points, annualized, over 10 years;

The reason: Bad market timing decisions. People pile into the market at the wrong times, and then they panic and sell at the wrong times.

Why? Because people are irrational, and are hardwired to make sub-optimal decisions.

Poor Communication Is The #1 Reason Advisors Get Fired

/ by Don Connelly / Managing the Relationship / 0 comments

The chief reason clients fire their advisors is not, as you may have thought, poor performance – it’s poor communication. A survey by Financial Advisor Magazine revealed that 72% of clients said they fired their advisors due to their advisor’s failure to communicate on a timely basis.

The best advisors put their communication strategy at the very heart of their business – and so should you. Not only should you build in time to communicate with clients – but take time to develop your soft skills so that you communicate effectively.

Avoid These Ten Mistakes to Improve Your Financial Advisor Business

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We’ve been getting plenty of questions about common mistakes Financial Advisors make so here’s a quick roundup of things you should avoid doing if you want to take your Financial Advisor business to the next level.