By Marc S. Freedman, CFP®
Reviewed by Gary W. Silverman, CFP®
Gary Silverman owns a fee-only financial planning firm in Wichita Falls, Texas. He is the editor of the financial newsletter Personal Money Planning, writes the newspaper columns Your Money and Biz2Biz, and hosts the cable talk show, Money Cent$. You can contact him at www.PersonalMoneyPlanning.com .
Marc Freedman's book, Oversold and Underserved, teaches you how to direct your practice toward serving the "Mass Affluent."
Who are the mass affluent? They are the ones who save, prepare for college and retirement costs, earn $75,000 to $175,000 each year, and will accumulate between $500,000 and $1.5 million in investable assets at retirement.
And when I say he wants you to serve this mass affluent, he means it. In fact, he points out that mixing either extreme into the mix can cause problems. With the middle market you can easily end up either under serving their needs or eliminating your profits. (Freedman found that in his own firm, staff was spending 30 percent of their time serving clientele that produced only 1 percent of the revenue.)
He is also passionate about the financial planning aspect of the business. While his firm also provides investment services, his mantra is that the mass affluent are served only when financial planning is the centerpiece of your work with them.
This doesn't mean that if you don't serve the mass affluent, want to have a wider range of clients, or provide mostly investment management services that you might as well ignore this text. Far from it. I have a wide range of clients and intend to keep it that way. I provide mostly investment management services and am not changing that in the near future. Yet I was scribbling and marking pages in the book to apply immediately to my practice. In fact I dare say that every firm can gain enough applicable ideas from Oversold and Underserved to pay for the book many times over.
However, if you do want to shift to the mass affluent market, this book will (as stated on page 24):
- Identify existing target markets within your practice.
- Transition your business from transactional methods to ones that focus on delivering ongoing value and service for a fee.
- Learn how genuine financial planning can be delivered as the foundational principle of every relationship you maintain with clients.
- Build marketing strategies that accentuate your best skills and make the most of hidden gems that exist in your practice today.
- Better communicate your value proposition to clients and prospects.
- Become immersed in the profession of financial planning so that you can both change the lives of the people you serve and ground your core value and beliefs to make growing your practice easier than ever before.
This is not a preachy book. Rather it is a "this works, we did it, here's how" kind of book. Freedman delivers by writing a book with clear examples of each point. It does not read as a textbook. Rather, it is akin to having a mentor help you develop your professional life. Sections include:
- An Introduction to Serving the Mass Affluent
- Practice Management Tips to Help You More Effectively Serve the Mass Affluent
- Crafting a World Class Financial Plan for the Mass Affluent, and
- Marketing and Practice Management Techniques that Retain the Mass Affluent Client
You'll learn how to set up your office and prepare your staff to make the best first impression. Meetings are described to show how to handle difficult situations. Market segmentation is discussed, and Freedman does not ignore the problem of what to do about clients who are no longer part of your target market. There's an excellent chapter on how to conduct seminar marketing and one on his personal experience with setting up a client advisory council.
As you can see, regardless of of his admonition to serve the mass affluent through financial planning services, you can glean much from reading this book. I highly recommend it.
Oh, and did I mention that Freedman is donating his royalties from this book to the Foundation for Financial Planning?
FPA Press (2008)
$30 FPA members; $35 nonmembers