Precision Financial Secures 98% Client Retention with 90-Day Engagement Plan

Precision Financial Secures 98% Client Retention with 90-Day Engagement Plan

Executive Summary

Precision Financial, a growing RIA firm, faced significant client churn within the initial 90 days of onboarding, primarily due to new clients feeling overwhelmed and underserved. To address this, Lisa Miller, Lead Advisor, implemented a meticulously crafted 90-day engagement plan encompassing structured communication, proactive education, and personalized support. The result? A dramatic increase in client retention, reaching a remarkable 98% within the crucial first three months.

The Challenge

Precision Financial experienced a worrying trend: new clients were leaving the firm within the first 90 days. While the firm excelled at attracting clients with an average portfolio size of $750,000, the initial onboarding experience was failing to solidify these relationships. An analysis revealed that approximately 15% of new clients, representing roughly $11.25 million in assets under management (AUM) annually, were lost during this critical period.

Several factors contributed to this early attrition:

• Information Overload: New clients were inundated with complex financial documents, unfamiliar investment strategies, and an abundance of paperwork, leading to confusion and anxiety. They received a hefty welcome packet, but lacked consistent guidance on understanding its contents.
• Lack of Communication: Clients felt uninformed and unsure about the progress of their financial plans. There was no structured communication strategy to keep them engaged and updated, leading to a perception of neglect. One client, a retired teacher, mentioned feeling "forgotten" after the initial consultation, stating she didn't hear from the advisor for three weeks.
• Unaddressed Concerns: Minor doubts or questions, if left unanswered, escalated into significant concerns, eroding trust in the firm. For instance, a client with $1 million in retirement savings expressed anxiety about potential market volatility but didn't receive timely reassurance, leading to them considering moving their assets elsewhere.
• Inconsistent Experience: The onboarding process varied depending on the advisor handling the account, resulting in an inconsistent and often substandard experience for some clients. Some advisors were more proactive than others, creating an uneven playing field.
• Fee Sensitivity: Some clients were unclear about the firm's fee structure and the value they were receiving in return. The annual advisory fee of 1% (or $7,500 for a $750,000 portfolio) seemed high to some without proper context and understanding of the personalized services offered.

These challenges highlighted the need for a standardized, proactive, and client-centric onboarding process to build trust, educate clients, and foster long-term relationships. The existing onboarding process was costing the firm approximately $84,375 annually (15% client churn * $750,000 AUM/client * 1% advisory fee).

The Approach

Lisa Miller recognized the need for a fundamental shift in Precision Financial's onboarding strategy. She designed a comprehensive 90-day engagement plan centered around the following key principles:

• Structured Communication: The plan included a series of pre-scheduled touchpoints designed to educate and engage clients throughout the first 90 days.
• Proactive Education: Instead of overwhelming clients with information upfront, the plan delivered digestible content in a phased approach, focusing on key concepts and addressing common concerns.
• Personalized Support: The plan incorporated personalized check-ins and opportunities for clients to ask questions and receive tailored advice.
• Building Trust: The plan aimed to establish a strong foundation of trust by demonstrating competence, transparency, and genuine care for the client's financial well-being.

The 90-day engagement plan consisted of the following components:

• Week 1: Welcome and Introduction: A welcome email and phone call from the lead advisor, reiterating the firm's commitment to their financial goals and outlining the onboarding process. This included a clear explanation of the advisory fee and the value proposition. Clients were also introduced to the client portal and instructed on how to access their accounts and track their progress.
• Week 2: Financial Plan Review: A virtual meeting to review the client's financial plan in detail, explaining the underlying assumptions, investment strategies, and risk tolerance assessments. This provided an opportunity to answer any questions and address concerns about the plan's suitability.
• Week 3: Investment Strategy Deep Dive: An email and accompanying video explaining the client's investment portfolio allocation, diversification strategies, and the rationale behind each investment decision. This helped clients understand the "why" behind their investments.
• Week 4: Goal Setting and Progress Tracking: A phone call to reaffirm the client's financial goals and establish clear metrics for tracking progress. This included setting realistic expectations and discussing potential market volatility.
• Month 2: Mid-Point Check-In: A comprehensive review of the client's portfolio performance and progress towards their financial goals. This included a detailed analysis of market trends and their impact on the client's investments.
• Month 2: Educational Webinars: Invitations to attend webinars on topics relevant to their financial situation, such as retirement planning, tax optimization, and estate planning.
• Month 3: Proactive Problem Solving and Ongoing Support: A dedicated point of contact within the firm to address any questions or concerns that may arise. Clients were encouraged to reach out with any issues, no matter how small, to ensure their needs were met.
• Month 3: 90-Day Review Meeting: A final meeting to review the entire onboarding process, solicit feedback, and discuss the client's long-term financial goals. This provided an opportunity to strengthen the relationship and reinforce the firm's commitment to their success.

Technical Implementation

The successful implementation of the 90-day engagement plan relied on the integration of several key technology tools:

• Mailchimp: Used to automate the email sequences, ensuring timely and consistent delivery of educational content and important updates. Personalized tags were used to tailor the content to each client's specific needs and preferences. A/B testing was performed on email subject lines to optimize open rates.
• Calendly: Utilized for scheduling phone calls and virtual meetings, streamlining the appointment booking process and reducing administrative overhead. This ensured advisors were available when clients needed them, improving client satisfaction. Integration with Google Calendar prevented scheduling conflicts.
• Redtail CRM: Served as the central hub for tracking all client interactions, communications, and tasks. This provided advisors with a comprehensive view of each client's onboarding progress and ensured that no client was overlooked. Workflows were configured to trigger automated tasks and reminders, ensuring adherence to the 90-day engagement plan. Data was segmented to track client progress within the onboarding phase, immediately flagging clients not engaging so advisors could intervene.
• Client Portal: Provided clients with secure access to their account information, financial plans, and investment performance reports. Two-factor authentication was implemented to protect client data.
• Financial Planning Software (e.g., MoneyGuidePro): Used to generate personalized financial plans and investment strategies, providing clients with a clear roadmap to achieving their financial goals. Scenarios were run to illustrate potential impacts of market volatility or life changes.

The firm also implemented a standardized onboarding checklist to ensure that all advisors followed the same procedures and processes, resulting in a consistent and high-quality client experience. This included tasks such as completing KYC (Know Your Customer) requirements, obtaining necessary signatures, and verifying account information.

Results & ROI

The implementation of the 90-day engagement plan yielded remarkable results for Precision Financial:

• Client Retention Rate: Increased from 85% to 98% within the first 90 days of onboarding. This represents a significant reduction in client churn and a substantial increase in AUM retention.
• AUM Retention: Retained an additional $9.75 million in AUM annually, translating to approximately $97,500 in additional revenue. This more than offset the cost of implementing and maintaining the new onboarding process.
• Client Satisfaction: Client satisfaction scores, measured through post-onboarding surveys, increased by 25%. Clients reported feeling more informed, engaged, and confident in the firm's ability to manage their finances.
• Advisor Efficiency: Advisors reported a 15% reduction in time spent on onboarding activities due to the streamlined processes and automated communication. This freed up their time to focus on other revenue-generating activities, such as client acquisition and relationship management.
• Reduced Complaints: The number of client complaints related to onboarding decreased by 70%. This indicates that the new onboarding process effectively addressed client concerns and expectations.
• Net Promoter Score (NPS): Increased by 30 points, indicating a significant improvement in client loyalty and willingness to recommend the firm to others.

The initial cost to develop and implement the 90-day engagement plan was approximately $10,000, including the cost of software licenses, training, and consulting. However, the substantial increase in client retention and AUM retention quickly offset this investment, resulting in a significant return on investment (ROI) within the first year.

By reducing client churn and improving client satisfaction, Precision Financial solidified its position as a trusted and reliable financial advisor in the community.

Key Takeaways

Here are a few key takeaways for other RIAs looking to improve their client onboarding process:

1. Structure Your Onboarding: Create a detailed and structured onboarding plan with pre-scheduled touchpoints to keep clients engaged and informed. Don't leave onboarding to chance; proactively manage the client experience.
2. Educate Proactively: Provide clients with digestible educational content in a phased approach, addressing common concerns and building their financial literacy. Explain complex financial concepts in simple, easy-to-understand language.
3. Personalize the Experience: Tailor the onboarding process to each client's specific needs and preferences, demonstrating that you understand their unique financial situation and goals.
4. Track and Measure Results: Monitor your client retention rate, client satisfaction scores, and other key metrics to assess the effectiveness of your onboarding process and identify areas for improvement. Use a CRM to track engagement and identify clients who might be at risk of churning.
5. Leverage Technology: Utilize technology tools to automate communication, streamline processes, and provide clients with secure access to their account information. Tools like Mailchimp, Calendly, and a robust CRM can significantly improve the efficiency and effectiveness of your onboarding process.

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